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Stellar is a platform that connects banks, payment systems and people so they can move money easily anywhere in the world. Stellar makes this possible- Stellar has created a cryptocurrency LUMEN. It serves as a universal translator between each fiat currencies. here's how?
Imagine a business in USA that needs to pay supplier in China. They have got a bank account in Kansas city but they need to provide the payment in Chinese Yuan for the suppliers in Guangzhau. What they can do? They can send money traditional way by international wire but international wire takes several days to clear and in many cases, move through many intermediary banks to proceed. each intermediary takes certain cut to deliver and as money moves around the world, business in Kansas city moves more and more of its cash to unnecessary middle men.
Stellar addresses it. Stellar has a decentralized exchange built right in to its protocol. It can route a payment in US dollar in its order book so that it comes on the other end as Chinese Yuan. If there is no good offer to exchange dollar to Yuan, LUMEN acts as intermediary. Stellar converts dollar to Lumen and then Lumen to Yuan all in under 5 secs and through fees of 1/10,000 of a cent. In addition to serving as a universal currency translator, lumen also protects the integrity of the network by preventing spam. Transaction fees are paid in lumens and every Stellar account has a minimum balance too. Transaction fees and minimum balance are low enough that legitimate users don't notice them but high enough to deincentivise spammers. Lumens are critical component for the Stellar protocol - they allow it to efficient, scalable and they serve as a universal translator for assets so you can move funds cheaply but not too cheaply. With transparency and security that only blockchain can provide, that's a big step for financial infra-structure. Thanks to Stellar.
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