The Crypto world continues to remain cryptic, even as we scribble these words. And one of the biggest reasons for this obscurity is that platforms and cryptocurrencies are not compared regularly. Take the example of Ethereum & Stellar, two platforms that share the purpose of development solutions, but that is pretty much all that an average crypto geek knows about them. It is important to understand how these platforms are similar to each other, what features distinguish them and which one is better for your use, and why. And that is what we are going to do in this discussion as well! So, if you were looking for a comprehensive guide that talks about the key features of both platforms, well, you are just on the right page!
Ethereum & how does it work?
Let us get things going by recapping Ethereum features. As most of you might already know, it is a blockchain development platform that has the capability of issuing customized tokens for new projects. One of the key reasons for Ethereum’s popularity is its decentralized nature, anyone can join the blockchain and contribute to the network’s operations. The most amazing thing about Ethereum is that while it does allows the creation of custom tokens, these tokens are not essentially limited to play the role of cryptocurrency that is limited to the blockchain under discussion itself. So, if you are someone who wants to launch your decentralized application or blockchain, Ethereum is your ultimate stop. The tokens issued can be used for crowdfunding through their utilization in ICOs as well. Another fascinating thing about Ethereum is that it is built on its own codebase.
Stellar & how does it work?
The Stellar platform has been off the radar for some time. But now, the world is awakening to the brilliance of features it offers. If you are not familiar with Stellar already, then these lines will serve as a guide for you. Well, describing things in the simplest possible manner, Stellar is a payment transfer protocol. This protocol makes cross-border payments possible, featuring multiple currencies in this execution. One of the cryptocurrencies supported is, of course, Lumens, the Stellar network’s token. Founded by Jed McCaleb, the co-founder of Ripple, Stellar features its own algorithm, known as Stellar Consensus Protocol. It is Stellar’s reliance on the DLT which makes it faster than other crypto networks. Stellar facilitates transaction execution via facilitators popularly known as Anchors.
Stellar vs. Ethereum: The ultimate comparison
We wish we could talk a bit more about the technologies on which these platforms work. However, that is not the point of this discussion. So, with the basics revised, let us now move towards the comparison section of this discussion.
Ethereum is prone to anonymous hack attacks, and the reason for this weakness stems from the very feature that makes Ethereum a popular choice in the first place. Flexibility. You see, since Ethereum became a widely used portal in the early days, its code became vulnerable, thereby opening a window of exploitability. On the other end of the spectrum, there is Stellar, which features simple but less flexible contracts. This less flexibility works in the favor of Stellar greatly, since it narrows down the possibility of hacker attacks. Hence, the Stellar operation is more safe and secure as compared to Ethereum.
We are mainly talking about KYC/AML compliance here. KYC stands for Know Your Customer while AML refers to the Anti-money laundering umbrella. Stellar features KYC/AML compliance but Ethereum doesn’t. Start-ups are more likely to use a blockchain that caters KYC/AML feature. Hence, Stellar again trumps Ethereum. Ask yourself, which platform are you more likely to trust? One that features provisions for anti-terrorist activities or one that comes without these regulations?
Spoiler alert, there is no comparison whatsoever! Why? Well, on average, a Stellar transaction takes about five seconds. Compare that to Ethereum, which takes as much as 3½ minutes. The difference is too big to be ignored, don’t you agree? Also, Stellar is a preferred choice for many, when we compare the transaction fee as well. What users have to pay in the name of transaction fees on the Stellar platform is only a fraction of what they might have had to pay on the Ethereum network.
For someone who is willing to develop a complex application, opting for Ethereum is a good decision. You see, this platform opens a wide network of possibilities for developers and programmers without featuring any limitations whatsoever. This is made possible through Ethereum’s Turing complete smart contracts. On the other hand, Stellar provides smart contracts that are simple and non-Turing complete. Hence, only the simple functionalities for basic applications are offered by Stellar. So, if we had to pick a winner purely based on which one is a better development platform, we would definitely vote for the Ethereum blockchain.
So who wins?
It is not exactly a UFC championship! Both platforms come with plenty of amazing features. To recap them, Stellar is an option for those who are after simplicity & speed at a reasonable rate. On the other hand, if someone is after a platform that allows them to develop Turing complete, complex applications, then going for the Ethereum network is a better option. There is no way we are going to be disrespectful to both platforms, these are the models that have revolutionized the crypto world, and that is putting things mildly!
We are fully cognizant of the wrinkles that still need to be ironed out if Stellar and Ethereum are to become the near-perfect exemplary models. For example. And this is just an example, Stellar needs to attract more audience for using its DEX and developmental solutions that it offers. If it can achieve this goal in the coming years or so, it has all the potential to take over the market share that other crypto platforms are currently in possession of. Nothing more would thrill the Stellar community, that’s for sure!