Stripe supports the nonprofit decentralized payments network Stellar, from the original creator of Mt. Gox – TechCrunch
There is bitcoin, the asset and protection against fiat currencies and the policies of their central banks.
And then there is Bitcoin, a fundamental innovation in a distributed public transaction book. Many cryptocurrencies try to split or play with the distinction between the two.
An early attempt was the Ripple from OpenCoin. But the team behind this startup has split. Co-founder and Mt. Gox inventor Jed McCaleb went to work on other stealth projects.
Now he’s reappearing with a new nonprofit called Stellar, backed by Stripe. Joyce Kim, who founded a company called SimpleHoney that was acquired by OpenCoin, also runs the nonprofit.
The similarities are obvious. Stellar is a decentralized protocol for sending and receiving money in any currency pair. It’s not exactly a competitor to Bitcoin; It is designed to facilitate transactions in all types of currencies, from major currencies such as yen, dollars and euros to other emerging market fiat currencies.
This protocol is coupled with a cryptocurrency called Stellar. They start with a fixed number of Stellars that they give away to new users for free. This is very different from Bitcoin, which has to be mined by machines that solve complex cryptographic problems in exchange for small amounts of the currency given out at fixed time intervals.
Kim has argued in the past that this is an egalitarian approach. Mining means that only people with high technical skills or the capital to operate expensive mining hardware now will have access to new Bitcoin. But Stellar is distributing half of its original amount to anyone who signs up for it through the program. Stripe will receive 2 percent of the existing Stellars in exchange for $ 3 million.
A quarter of Stellars will go to nonprofits through an “increased access” program, while another 20 percent will go to existing Bitcoin holders, based on a snapshot of the blockchain at some future date. The remaining 5 percent is used for operating costs. As the value of Stellar’s payment network increases, so does the value of the Stellars that the nonprofit holds.
Unlike Bitcoin, the Stellar economy has an indefinite built-in inflation rate of 1 percent.
Stellar’s board of directors has Stripe co-founder Patrick Collison, Khosla VC and former Square COO Keith Rabois along with McCaleb on the board. The non-profit organization is also advised by security experts Dan Kaminsky, Joi Ito, Ronaldo Lemos, Linda Stone, Sam Altman from Y Combinator, Naval Ravikant from AngelList, Jackson Palmer, Greg Stein and Matt Mullenweg from WordPress.
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