Last week I found the time to dive into the cryptocurrencies world. After reading a bit, I decided to buy some Ethereum and Stellar Lumens.
Stellar Lumens are still very cheap and the project itself is interesting. So while waiting and hoping that the price will go up, let´s get started with some Stellar development too.
Stellar is a payment network based on the exchange of its currency Lumens.
Many people have heard about Blockchain, which is a specific way of implementing a distributed ledger by using chains of blocks containing transactions data.
But a ledger is something more generic.
Think of a distributed ledger as a spread database, that exists across multiple locations and multiple participants to avoid having a single point of failure and benefit from a “community” to perform transactions or any other data transfer.
Every entity sent through a database ledger has a unique cryptographic signature.
We can think as blockchain technologies as a subset of the distributed ledger ones.
Distributed ledgers are controlled by the participants and therefore allow more transparency.
The stellar network mantains and replicates the distributed ledger on every Stellar server node.
The Stellar ledger can be seen as a distributed exchange order book that allows users to store the transactions.
With a distributed ledger sending money becomes closer to sending an email: fast and very cheap!
STELLAR CONSENSUS PROTOCOL
The Stellar Consensus protocol (SCP) is an implementation of the model proposed in the Federated Byzantine Agreement (FBA). The goal is providing a secure consensus mechanism.
The key properties of SCP are:
- low latency
- digital signatures and hash families
- decentralized control
- flexible trust
A quorum of trusted parties (also called Consortium) is required to validate and secure the transaction over the network.
The consensus for every transaction is achieved by verifications and updates among servers.
Users can configure the set of parties they want to trust.
You can read more about the SCP protocol in the official documentation: https://www.stellar.org/developers/guides/concepts/scp.html
A simplified version is also available here: http://www.scs.stanford.edu/~dm/blog/simplified-scp.html