The company, Stripe, is now diving into the realm of online currency by backing the newly launched company Stellar, a new digital currency and payments network. Stripe already uses technology that allows businesses to accept payments online, but there recent backing of Stellar has helped to introduce a new online Bitcoin-like currency. The launch has also opened a new online payment network that allows users to send both traditional and digital currency, also known as “crypto-currency”, across the globe. This includes US dollars, euros, pesos and their competitions Bitcoins. The technology lets users send money almost anywhere and have it automatically converted into another currency. It has been billed as a sort of all-inclusive online money exchanged. Stellar will be given away for free at first to introduce new customers to the ways of online currency. Stellar is also using this move as a type of promotional tool to get their business out to as many people as possible quickly. Bitcoin is a software-based online payment system which briefed by Satoshi Nakamoto in 2008 and introduced as open-source software in 2009. Payments will record in a public ledger using its own unit of account, which is also called bitcoin.
Stellar was created by the Stellar Development Foundation, a non-profit that was created by Stripe CEO Patrick Collison and Ripple co-founder Jed McCaleb. Stripe also contributed $3 million dollars to the company’s initial funding. Collison first considered the idea of creating an agnostic online payment network after he and his brother John began working on the technology for Stripe in 2011. In an interview with Fortune Magazine Collison stated, “Even before Stripe launched, we were thinking about what crypto-currencies mean for Stripe and in particular, how we can take advantage of them in order to accomplish the things we want to do.” Collison wanted to make online payments universal and ubiquitous, and he felt that crypto-currencies aligned with that vision. Bitcoins are created as a reward for payment processing work in which users offer their computing power to verify and record payments into the public ledger which is called mining. Individuals or companies engage in this activity in exchange for transaction fees and newly created bitcoins.
To bring his idea to life, Collison collaborated with Ripple creator Jed McCaleb. Collison and McCaleb both agreed that establishing a non-profit that was separate from Stripe to be in control of the development of Stellar was the best strategy. Collison believed that the basic parts of the company shouldn’t be controlled by a single entity. They also decided to give away the majority of Stellar’s currency for free. Half of the 95 billion Stellar coins used for currency would be given away to people that signed up for Stellar through Facebook
Now many Bitcoin companies would never be able to deal the amounts of Bitcon currency if it wasn’t for locking in great rates with a Bitcoin Merchant Account first.
The question still remains, will the currency achieve any sort of significant value? The currency’s success will depend on how much the currency is used and whether the network it flows through takes off. Collison admits that it will take time for the project to get off the ground, if it does at all.
About the Author:
Blair Thomas is the co-founder of award winning high risk merchant processing company eMerchantbroker.com and a Bitcoin expert. He has 10+ years of experience in the electronic payments industry, managing several successful agent offices and registered ISO’s. He enjoys spending time with his family and lives with his dogs Cooper and Frank in Los Angeles, California. You can connect with Blair on Google +