Steller vs Ripple Consensus

Abeeha Saeed
4 min readApr 20, 2021

Investing in cryptocurrency is a new emerging trend and two names that keeping popping up are Ripple and Stellar. Both want to make a place in the global financial payment systems and both aim to make an improvement in the ease that customers will feel will making transactions. However, while their goal is the same and thus are bound to have similarities, they also have their differences.


Ripple was created in 2012 by the American programmers Jed McCaleb and Chris Larsen. Ripple refers to the name of the company which is in charge of developing the software technology which in turn is powered by its native cryptocurrency known as XRP.

The concept behind Ripple is to allow banks to be able to make international transactions in the quickest way possible and at no cost. Ripple does so by using distributed ledger technology which cuts out the need for a third party in across the border transactions and instead allows banks to deal with banks directly. The aim is to reduce inefficiency, high costs (which includes third party commissions) and slowness (especially if less popular currencies are being used).

In terms of market capitalization, Ripple is the third highest-ranking cryptocurrency out there.


Two years after Ripple was created, founder Jeb McCaleb created Stellar in 2014. When we talk about Stellar, we are referring to the technology and Lumens is the cryptocurrency.

Stellar also works on allowing affordable and quick transfer of funds. Similar to Ripple, it uses the distributed ledger technology. Stellar is aimed to be used by the average person and especially those people who live in developing area. Stellar aims to allow people in developing countries speedy and affordable transactions by converting the sender’s money into lumens and then converting the lumens into the receiver’s currency.

Stellar is also doing well in the market since its release and is a strong top ten multibillion-dollar cryptocurrency.


When we think of cryptocurrency, we think of bitcoins. However, both Stellar and Ripple vary a great deal from bitcoins. Bitcoin uses miners and so anyone can be a miner. All they have to do is simply download their client onto their device and they receive coins as a reward or payment.

Now neither Stellar nor Ripple allow the public to be able to run nodes, despite the fact that both are decentralized. Instead, the developers have their own nodes and only the people, banks, or organizations using the technology can run the nodes.

Another similarity is that both systems use a distributed ledger as the way to verify the fund movements. Which is why the transactions are quick and as cost effective as they can be- less than a cent.


While they might have the same creater, Stellar and Ripple have a great deal of differences as well.

When McCaleb left Ripple, he did so because he wanted to help poor people who did not have the luxury of financial services and so that is where the first difference arises: the target. Ripple was made primarily for banks and Stellar was created for people who did not have access to banks which is why is it called a “Not for Profit Organization.”

Another key difference is the way in which the nodes reach a consensus. The consensus model refers to the technology that validates and confirms transactions without the involvement of a third party. Most commonly used are Proof of Work and Proof of Stake. Stellar and Ripple don’t use either of the two consensus algorithms. Ripple employs the use of Proof of Correctness while Stellar uses the Stellar Consensus Protocol.

Another difference is that Lumens are inflationary and so they resemble real life money, while the XRP are deflationary which means they increase or decrease circulation. Similarly, Ripple is the more centralized of the two.

Ripple targets larger organizations and so there is an obvious difference in matters such as the transaction throughput. Ripple’s clients require more speed than those of Stellar and so it is arguably faster. On the other hand, since Stellar aims to help poorer people, it is arguable a more simple and user-friendly technology.


In terms of the Stellar vs Ripple debate, Stellar seems to have the upper hand. While Ripple is great, it is on a bigger level. Stellar is more accessible and is aimed to be used by the average person instead of huge corporations. It meets our individual needs and is easier to manage and understand.