Hello Stellar Lumens tribe!! 😀
This is the question I asked Lisa Nestor from Stellar Lumens (Lady in Orange; Director of Partnerships at Stellar.org) at the Blockchain Economic Forum 2018 on Monday. I’ve loosely transcribed Lisa’s answer to get the gist of it, and it should be more or less accurate.
I have a question–In order to use stellar lumens for day to day living, it seems to be essential to increase the velocity of circulation of lumens. I recognise that Stellar is doing an awesome job in partnerships, especially with the upcoming FairX which uses Lumens as a base currency. Can you give us more examples of what Stellar is doing for the rest of 2018 to make Lumens more popular amongst the masses?”
“Thank you for the question! Let me touch a little bit on how Lumens matter and the Stellar Ecosystem.
Lumens (XLM) are the what is used to pay the base fees for any transactions that are used in the Stellar network. And our mission is to be a very low-cost platform and for transactions to be as low-cost as possible. So that you can do a hundred thousand transactions on Stellar for one US cent, and maintaining the account is very low-cost, etc. So that’s one way lumens are used.
The second way that Lumens are used is as a transfer of value between any kind of digital assets that has been issued inside of Stellar. So the way that this works in my everyday life is as follows. For instance, if someone wants to send a payment from Dubai to Mumbai.
What this looks like is that in institutions, you start with a gateway between Ethereum, in the UAE, and the Stellar World issues a digital credit. So that’s an digital Ethereum backed by the institution. So inside of the digital distributed exchange, party A will say that “Hey, I have a digital ethereum which I want to sell, and for that I want to buy a digital rupee.” So that conversion can happen.
The way that you actually move between these two digital credits is by using something like Lumens as a transfer of value. So lumens can enable on-chain instantaneous settlement.
Some financial institutions are slower to adopt lumens as a form of instantaneous settlement. They are more interested in using Stellar as a platform for clearing transactions, and then using more traditional pre-funding or post-funding models to do the settlement. I would say most of the major banks are in this camp.
What is really exciting is that a large portion of our portfolio is moving towards tax-forward money services, that includes somebody here in Singapore, across Asia, across Europe, across Africa, who are getting increasingly open to immediately using lumens for instantaneous settlement between transactions.
I was just in The Philippines last week, working with some of our longest standing partners there. They are really interested in making use of lumens for instantaneously settlement, and I think we are going to see a lot of growth as we work towards making the model more flexible. ”
P/S. is it just me or does Lisa look like Taylor Swift?!