- Stellar’s latest project, Soroban, aims to integrate smart contracts into its mature blockchain platform, marking a significant milestone in its journey.
- Challenges lie ahead for Stellar as it seeks to challenge Ethereum’s dominance in the smart contract domain, including Ethereum’s larger market capitalization and developer community.
- Stellar’s resilience, ample resources, and strategic partnerships position it well for its transformation into a smart contracts platform, with Soroban serving as the linchpin of this transition.
Stellar, a mature blockchain project with nine years under its belt, has garnered attention for its latest project – Soroban. With a dedicated community of developers, substantial backing, and a strategic partnership with the global money transfer behemoth, MoneyGram, Stellar is setting its sights on a major transformation. However, it’s crucial to understand that Stellar was conceived in an era when blockchains primarily served the purpose of facilitating straightforward value transfers, far from the complexity of smart contracts.
The Unveiling of Smart Contracts
At the core of this transition lies the concept of smart contracts. These are self-executing contracts with their terms directly embedded in code. In simpler terms, they empower developers to create applications for decentralized finance (DeFi) and a multitude of other use cases on the blockchain.
Ethereum, born a year after Stellar, stands as the undisputed powerhouse in the smart contract domain. With a burgeoning ecosystem of layer-2 networks like Arbitrum, Polygon, and Optimism, Ethereum’s influence remains unrivaled. However, the field is not confined to a single player; competing smart contract platforms such as Solana, Aptos, Sui, Algorand, and numerous projects within the Cosmos ecosystem provide alternative pathways.
Now, Stellar introduces “Soroban,” its initiative to integrate smart contracts into its blockchain. The expected arrival of Soroban later this year is poised to represent a significant milestone in Stellar’s journey, which was initiated in 2014 by key figures, including Jed McCaleb. McCaleb, renowned for his role at Ripple, joined Stellar after internal conflicts led to his departure from Ripple.
The Vision of Stellar
Tomer Weller, Vice President of Product at Stellar Development Foundation, who oversees Soroban, expressed, “We envision decentralized finance as a significant part of the future, and we aspire to empower Stellar users to be a part of it.” If the Soroban upgrade enjoys substantial adoption, potentially catalyzing increased activity on the Stellar network, this could result in a fresh demand for its native token, XLM.
In 2023, XLM has gained 46% in value, trailing behind Bitcoin’s surge of 66% but surpassing Ethereum’s Ether, which recorded a 32% increase. Notably, the Stellar Development Foundation (SDF), which supports network growth through grants and funding awards, recently unveiled a partnership with Certora, a security platform. Certora equips developers with tools to ensure the security and reliability of their applications before release.
Challenges and Fierce Competition
While Stellar’s ambition is commendable, the path to challenging Ethereum’s dominance is laden with challenges. Ethereum’s market capitalization, nearly $190 billion, is approximately 65 times greater than Stellar’s. Stellar’s 30 full-time developers are dwarfed by Ethereum’s staggering count of 1,901. Ethereum’s decentralized finance protocols boast combined deposits of $20 billion, while Stellar’s total value locked is $18.5 million.
According to Doo Wan Nam, co-founder of StableLab, attracting quality projects to existing smart contract platforms has proven to be a challenging endeavor, making it even more formidable for newcomers. Different platforms cater to different priorities, with Ethereum being the go-to choice for those who prioritize security, and Solana for those in search of speed.
Stellar’s Resilience and Ample Resources
The Stellar Development Foundation is armed with substantial resources to drive Stellar’s transformation into a smart contracts platform. With more than 100 dedicated team members, the foundation’s objective is to establish Stellar as the global payment network standard. Its treasury holds approximately 22 billion XLM tokens, valued at around $2.3 billion. Stellar’s recent conference in Madrid was marked by numerous sessions dedicated to Soroban, underlining its significance.
Soroban – The Game Changer
Soroban stands as the linchpin of Stellar’s transition into a smart contracts platform. The name, derived from the Japanese word for abacus, reflects its compact and minimalist design. Stellar’s decision to use Rust as the primary programming language, alongside WebAssembly (WASM), represents a distinctive approach compared to Ethereum’s Solidity. This strategic move places Stellar in direct competition with Solana for developer adoption.
Combatting “State Bloat”
Another significant challenge that Stellar is addressing is the issue of “state bloat” or “ledger bloat.” It is the dilemma of blockchains continuously expanding without the removal of obsolete data. Stellar’s solution involves the expiration of obsolete data to prevent blockchains from growing indefinitely. This proactive approach sets Stellar apart from Ethereum and other platforms.
Conclusion
The path to challenging Ethereum’s dominance is no easy feat, and Stellar’s journey is no exception. However, armed with visionary leadership, strategic partnerships, and a commitment to innovation, Stellar is poised to carve its niche in the smart contracts realm. The success of Soroban and its integration into the Stellar network could represent a pivotal moment. As the landscape of smart contracts continues to evolve, the question remains whether Stellar can emerge as a formidable contender in the blockchain arena. The journey is long, but the stakes are high, and the blockchain world eagerly watches Stellar’s bold venture unfold.
Disclaimer
The information provided in this article is for informational purposes only and should not be considered financial advice. The article does not offer sufficient information to make investment decisions, nor does it constitute an offer, recommendation, or solicitation to buy or sell any financial instrument. The content is opinion of the author and does not reflect any view or suggestion or any kind of advise from CryptoNewsBytes.com. The author declares he does not hold any of the above mentioned tokens or received any incentive from any company.
