We are approaching 1 year after the most cryptic encryption market the world has ever seen, and a debate that has been the maximum of the mind on which it is still based: Stellar or Ripple?
When the blockchain entered the mainstream, we were told that technology has the potential to revolutionize almost every industry. And if a company could find a way to turn into everyday use, it would have had the potential to be worth billions. The legacy market of finance and financial infrastructure is strong, but many of us intuitively know that there are huge inefficiencies. These two companies have tried to address the basic (but currently complicated) use of money transfer between individuals within a country or even across a border.
The basic differences
What turns this subtle match-up into more than one caged match is the fact that Stellar was generated by Jed McCaleb leaving Ripple (after being an integral part of the start) to create Stellar.
Both cryptocurrencies are seen more as companies that use a cryptocurrency to create utilities rather than simple non-profit platforms. To put it another way, they are trying to carve out a piece of the bank cake and have already tasted blood.
Currencies technically meet two different needs, even if they are in the same space. Ripple wants their token, XRP, to become a base currency for Binance, but also a banking solution for money transfer as efficiently as possible. Stellar, on the other hand, is building a platform that allows consumers to carry money cross-border, with over 70 countries already part of their network.
Comparison between the two protocols
One of the main indicators of the success of a currency is if it is listed on Coinbase. They are the blue chip leaders of space, and it's a strong signal for any cryptocurrency that can get that kind of approval. The rumor has spread that XLM has been taken into consideration for the listing in July and in the last month XRP has received a more positive interest, but neither has yet reached this important milestone.
It is difficult to resolve the propaganda from the facts in this debate. You will constantly hear opponents who call XRP a security and will discuss the unethical distribution of coins, but you will also hear that XRP is twice as good as Bitcoin and has solved all the scalability problems inherent in the original protocol.
Evaluating the two protocols at the present time, both are very successful and have been almost inversely exchanged with the rest of the encrypted market. Between them two, Stellar seems to show the most positive potential at the moment. With Ripple ranked No. 2 in terms of market capitalization and Stellar as number 5, there is still a significant gap.
The graph of Stellar's performance in the last year show below is relatively similar to that of Ripple.
However, Stellar is reaching lows higher and shows the potential to break through resistance in the near future. In addition, they have a recently announced partnership with IBM that adds a ton to their fundamentals.
If you were choosing between them, Stellar is probably the best short-term bet. In the long run, both have plenty of room to grow in their respective niches, but they will end up facing market share. At that point, it could become messy.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. It holds investment positions in the currencies, but does not carry out trading activities in the short term or daily.
Featured image courtesy of Shutterstock.