Stellar is an open-source blockchain that links individuals and organisations globally. It is more affordable and efficient than other blockchain-based financial systems. Stellar blockchain solutions offer a wide range of use cases that are increasing fast. It provides security, decentralization, efficiency, and more to various blockchain projects. This article takes a look at the use cases of this emerging blockchain.
Understanding Stellar Blockchain
Stellar is an open-source network for issuing assets and making payments. You may generate, transfer, and trade digital representations of all currencies on Stellar.
Through a single network, Stellar enables free communication across all financial systems in the world.
Also, Read: Stellar Blockchain App Development | A Comprehensive Guide
Stellar Use Cases
From multi-currency transactions to FinTech solutions, we have listed the top Stellar use cases below:
The processing of multi-currency transactions using Lumen is one of the top use cases of the Stellar blockchain.
Lumens acts as a bridge between two currencies by allowing exchanges between two currencies if there isn't a direct market for them.
It is essential for facilitating global trade.
Stellar blends the strength of a seamless, blockchain-based payment channel with the ability to live on- and off-ramps to many foreign currencies. It is possible with the help of local collaborators. These collaborators, known as Anchors, receive and disburse local fiat currencies while moving their values over the Stellar network.
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Exchanges can enable compliant on/off ramps, including cash-in and cash-out points, with the help of Stellar. Thus, it gives exchanges access to regional currencies in neglected regions, such as those lacking bank accounts.
Stellar uses Anchors to enable collaboration between conventional and digital financial institutions under one roof. Anchors are natively interoperable on/off-ramps within the Stellar network. They provide standardized services for changing local cash into Stellar-based assets and vice versa.
Middlemen lead to lengthy settlement periods and higher operational expenses. Thus, it is challenging to grow remittance services to those who require them the most.
Stellar tracks the transmission of digital copies of various currencies using two efficient payment methods. Thus, it assists companies in facilitating international trade without middlemen like correspondent banks.
Businesses employing Stellar have direct access to an anchor network of partners to distribute and accept fiat (conventional currency).
Stellar is a tested blockchain network designed for interoperability between different international payment systems. It also sets the bar for compliance. Stellar enables fintech businesses to provide underbanked customers access to more financial products and global accessibility to USDC and other stablecoins.
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Businesses can use Stellar to virtually represent financial items and physical assets, such as stablecoins, Central Bank Digital Currencies (CBDCs), and more. It makes it possible for customers to quickly, economically, and promptly access their assets.
Central Bank Digital Currencies (CBDCs)
Lumens is most appropriate for CBDCs owing to its trust system. There are two assumptions for Stellar's security.
First, each issuer is motivated to protect their asset and can be relied upon to tell the facts about that asset.
Second, while issuers desire to cooperate with other nations, they won't "cheat" or unilaterally violate the regulations if doing so would isolate them from the rest of the world.
Also, Read: Stellar Based Real-World Blockchain Solutions | Scanning the Stellar World
Stellar uses blockchain technology to advance financial inclusion for people all around the world. The network offers services similar to a traditional bank with a few significant variations. Stellar connects individuals worldwide to affordable financial services.
If you require a partner to build solutions on Stellar blockchain, then Oodles Blockchain can help you. Contact our Stellar developers if you want to develop and integrate Stellar applications from scratch. Our blockchain specialists will consult with you to determine your needs and what you'll require for your organization.
Hire blockchain developer, by doing so you can tap into his expertise in building secure and efficient blockchain solutions. They will be responsible for developing and implementing smart contracts, integrating our existing systems with blockchain platforms, and ensuring the security and scalability of our blockchain infrastructure.