Stellar Co-Founder: Ripple and Visa are Not Our Direct Competitors

Stellar Co-Founder: Ripple and Visa are Not Our Direct Competitors

Speaking with journalists attending the Crypto Finance Conference held at the Ritz-Carlton in Half Moon Bay, California last night, co-founder of Stellar Jed McCaleb outlined his vision for the future direction of Stellar as well as the reasons for which he does not consider Ripple and current, established payments providers as a threat to Stellar’s own future adoption. 

In the context of a discussion on public vs. permissioned blockchains, McCaleb stated, “In the future there won’t be so much of a divide on these two things … it will be similar to LANs which connect to the larger internet … permissioned chains won’t be able to operate fully as blockchains unless they can interact with [permissionless] elements outside of the permissioned group.”

As a public, permission-less blockchain, McCaleb added that “…this is what Stellar will give you – the ability to interact with everyone else” implying that private, permissioned blockchains such as Ripple may end up leveraging technologies such as Stellar for interoperability with other private technologies. 

Space for Many Different Players

On Ripple specifically, he stated that, whilst the technology has some overlap in capability with Stellar, “the world of payments is super large, so I don’t consider ourselves competitors with either of those [Ripple and establishment payment institutions such as Visa] … there is space for many different players.” 

After the announcement of a Stellar / IBM partnership back in May, many analysts now see Stellar as a leading challenger to become a global leader in blockchain-based borderless payments.

However, whilst there is increasingly strong justification for that view, some still question the ability for Stellar’s native XLM cryptocurrency to take on the required fundamentals momentum over the longer term for it to become a store of value.

Fees are so incredibly low and the total supply of coins is so incredibly high, the velocity of the tokens is virtually insignificant, [meaning] there is very little economic case for the tokens to rise in value in the near future,” stated one eToro analyst back in August.