Stellar vs Ripple: Which way should investors lean in 2023?
- Though Stellar and Ripple were designed for cross-border payments and digital asset exchanges, they have several differences.
- Q2 for both tokens has been challenging, thanks to bearish market conditions.
As the world is looking forward to a sustainable future, many in the crypto space are skeptical about mining. Thinking of non-minable cryptos, apart from Ethereum [ETH], which recently adopted PoS, Ripple [XRP] and Stellar [XLM] are two other major players. Therefore, Stellar vs Ripple is an intriguing topic of discussion that can help investors make informed decisions.
Read Ripple’s [XRP] Price Prediction 2023-24
The basic difference between Stellar and Ripple
Though both blockchains share a few similarities, there are several key areas in which they differ. First and foremost, Stellar is an open-source platform, which is not the case with Ripple. It’s interesting that while both blockchains were developed to create an impact on financial services, their ideologies are poles apart.
On one hand, XRP’s focus remains primarily on banks, while Stellar’s purpose is to give consumers a chance to engage with the global market. Another major difference is in the nature of their native tokens, as XRP is a deflationary token and XLM has a fixed annual inflation rate.
A look at XLM and XRP’s tokenomics
Mentioning both the cryptos’ tokenomics, CoinMarketCap’s data revealed that XRP at press time had a circulating supply of 51.8 billion tokens, while Stellar’s native token XLM had 26.7 billion.
XRP and XLM have a maximum supply of 100 billion and 50 billion, respectively. It was interesting to note that at the time of writing, both tokens had a circulating supply of just above 50% of their total supply.
Not to mention, XRP has a higher market capitalization of more than $23.9 billion, earning it the sixth spot on the list of largest cryptos. On the contrary, XLM sits in the 28th spot on the same list with a market cap of over $2.4 billion.
XRP is yet to unleash its full might
A major setback for Ripple has been its lawsuit against the Securities and Exchange Commission (SEC), which has been troubling XRP since 2020. For starters, the SEC accused Ripple and its employees, Christian Larsen and Brad Garlinghouse, of selling unregulated securities worth more than $1.3 billion to the public.
The lawsuit certainly had a negative impact on XRP, as investors might have gotten dubious about the token. However, the good news is that the lawsuit is expected to end soon, as many had anticipated.
Hoping Judge Torres rules any day now or a settlement is announced, but in the meantime i have set myself imagined timelines for the case to end. From my list in March only 2 remain. I have removed May 29th as that is Memorial day. So June 5th and June 21st…… https://t.co/UUrjf3lcKS
— Ashley PROSPER (@AshleyPROSPER1) May 1, 2023
Stellar’s plans for 2023 looks promising
While XRP’s lawsuit closure will be instrumental for the blockchain’s growth, Stellar’s plans for 2023 are also optimistic. The blockchain’s primary focus for 2023 is to increase its utility. As per Stellar’s roadmap, its work this year will be organized around three building blocks that take network utility to the next level.
Choosing which smart contracts platform to build on can be difficult. So let us make it easier for you. Here’s why you should build on Soroban over other popular platforms like Ethereum & Solana 👇https://t.co/A2NVQVtIP5
— Stellar (@StellarOrg) April 25, 2023
One of the major updates was the launch of a new, state-of-the-art smart contract platform that is developer-friendly, scalable, and deeply integrated with Stellar, named Soroban. As of 5 May, Soroban was live on the test network dubbed Futurenet.
XRP and XLM in Q1 2023
In comparison to the previous quarter, Ripple’s total XRP sales, net of purchases, were $361.06 million in Q1, as compared to $226.31 million in the previous quarter. On the price front, things remained dormant for most days in Q1.
It was only in late March that XRP’s price shot up. The price also made XRP more popular, as evident from the rise in its social volume. During the price hike, XRP’s network growth also increased, indicating more new addresses were used to transfer the token.
XLM’s situation was also similar to that of XRP’s in the first quarter of 2023. The token’s one-week price volatility remained low, which later spiked when the token’s price registered gains. Thanks to the price uptick, XLM’s social volume also increased during the last few weeks of the quarter.
Stellar vs Ripple in Q2
The quarter started on a good note for both tokens, as their prices were high. However, it did not take long for things to get darker, thanks to the bearish market condition. Stellar’s development activity has increased over the last few weeks, which is by and large a positive signal. However, its volume and weighted sentiment declined sharply, reflecting less interest from investors in XLM.
On the contrary, XRP’s development activity declined, suggesting fewer efforts by the developers to improve the network. The price drop propelled negative sentiments in the market, as evidenced from the weighted sentiment graph. Investors’ willingness to trade XRP was, however, higher than XLM, as XRP’s trading volume was relatively higher.
At press time, XRP was trading at $0.463, while XLM was valued at $0.09332.
How much are 1,10,100 XLMs worth today?
ChatGPT’s take on Stellar vs. Ripple
Jailbroken ChatGPT had an interesting opinion on both blockchains’ comparisons. The DAN was quick to highlight a few differences between Stellar and Ripple. Then it said that, in terms of investment purposes, investors can put their bets on both of the tokens. Or not, if you want to “wallow.”
Considering the aforementioned points, 2023 will be an instrumental year for both blockchains. One has a robust roadmap, while the other’s fate might change with its possible lawsuit conclusion. Which way Stellar and Ripple head over the coming months will be interesting to monitor.