Stellar (XLM) vs. Ripple (XRP): Which Crypto Is Best?

XLM targets individual and small business financial services with a decentralized approach, whereas XRP focuses on centralized interbank settlements backed by Ripple.

Written by: Mike Martin   |  Updated February 26, 2024 

Reviewed by: Ryan Grace

Fact checked by: Laurence Willows

2 blockchain networks

This article will compare two major altcoins: Stellar’s ‘XLM’ and Ripple’s ‘XRP’.

Though these cryptocurrencies are both classified as ‘payment coins’, there are some major differences between the two.

Stellar (XLM) is a decentralzed payment network that facilitates the peer-to-peer exchange of digital tokens. Ripple (XRP) is a centralized payment network that focuses on transferring digital assets between large financial institutions. XRP has a higher market cap and is favored by institutions while XLM has a lower market cap and is preferred by individuals. 

Which coin is best for your portfolio? Let’s find out!

Table of Contents

🍒 tasty takeaways

  • Stellar (XLM) and Ripple (XRP) are major altcoins with different focuses: Stellar targets individuals and businesses underserved by the financial system, while Ripple caters to large financial institutions.

  • Ripple is centralized, while XRP is decentralized.

  • Ripple is a for-profit company, while Stellar Lumens is a non-profit organization.

  • Stellar distributed a significant amount of XLM for free to promote adoption, while Ripple owns a large portion of XRP.

  • XRP has a market cap of $29 billion, while XLM has a market cap of $3.31 billion.

XLM vs XRP: Overview

The native cryptocurrency to the Stellar blockchain (sometimes referred to as Stellar Lumens) is XLM. Although Stellar is technically a coin, it is often referred to as a ‘token’ because all of its coins were pre-mined. 

The native cryptocurrency of the Ripple blockchain is XRP. Like XLM, XRP is technically a coin but is often referred to as a ‘token’ because of its pre-mined status. 

XLM vs XRP: What’s the difference?

The main difference between Stellar’s XLM and Ripple’s XRP is that Ripple caters to financial institutions while Stellar focuses on individuals (peer-to-peer transfers and remittances). 

Here are a few more differences between our coins. 

Feature Ripple (XRP) Stellar Lumens (XLM)
Focus Primarily for large financial institutions Aimed at individuals and smaller businesses not well-served by traditional finance
Structure Centralized Decentralized
Company Type For-profit company Non-profit organization
Founding Year 2012 2014
Consensus Protocol Ripple Protocol Consensus Algorithm (RPCA) Stellar Consensus Protocol (SCP)
Ownership of Tokens Large portion held by Ripple Significant amount distributed freely to foster adoption
Market Capitalization $29.7 billion $3.31 billion
Token Distribution Pre-created total supply at launch Supply distributed progressively over time

Both XLM and XRP work in a similar fashion.

  1. A financial institution (XRP) or individual (XLM) converts fiat currency to the coin of their choice via the Ripple or Stellar crypto bridge

  2. Using this bridge, a transfer of crypto assets is carried out in seconds.

  3. When the transfer is concluded, the coin is then transferred back to the specified fiat currency. 


What is Ripple (XRP)?

Ripple Labs was created by Jed McCaleb in 2012 after the sale of Ripplepay. Other integral members of the team include Arthur Britto and David Schwartz.

The aim of Ripple Labs was to create a faster and more energy-efficient blockchain than Bitcoin. In 2012, Ripple was formally launched with the creation of 100 billion XRP coins. 

Unlike most blockchains in existence, Ripple bypasses the traditional mining (Bitcoin) or validating (Ethereum) consensus mechanism and validates between network participants. Compared to bitcoin, the energy used to validate Ripple XRP transactions is essentially nil. 

“The Ripple Protocol Consensus Algorithm demonstrates a novel approach to distributed payment systems, achieving low-latency consensus and robustness in the face of Byzantine failures.”

Learn more about Ripple from its whitepaper below!

📖 Read: Ripple Whitepaper

Ripple and the SEC

In 2020, the SEC filed a lawsuit against Ripple Laps, the team behind Ripple and XRP for selling unregistered securities. On July 13th, 2023, a judge concluded that XRP was in fact not a security. There were some contingencies to this ruling, but overall, the ruling was positive news. XPR immediately doubled in value following the news. 

🍒 Compare two other crypto heavyweights here! Cardano vs Solana

What is Stellar (XLM)

Jed McCaleb also launched Stellar Lumens, but he did so in 2014, two years after the launch of XRP. 

According to Stellar’s whitepaper, this protocol:

“... is a new model for consensus called federated Byzantine agreement (FBA). It promotes organic network growth by allowing open membership, in contrast to traditional models that rely on a fixed membership list.”

Unlike Ripple, Stellar is a non-profit organization. McCaleb’s goal with Stellar is to make it easier for people to transfer funds globally. With Stellar, you can send funds to any location in the world in seconds for a few pennies. 

Like Ripple, Stellar isn’t weighted down by computational heavy consensus mechanisms, Using a network of validators, Stellar transactions are validated in seconds with near-zero energy required.


Ripple (XRP) vs Stellar (XLM): Live Charts

XLM Chart

XRP Chart


Ripple and Stellar have very different value propositions. Ripple is a for-profit company with a market cap of $33b while Stellar is a non-profit with a market cap of $3.3b. In terms of revenue and overall structure, Ripple is in a better position to generate returns than Stellar, especially with Ripple’s recent defeat over the SEC in court. 

Judging from various price projections, which puts XLM between $0.70 and $2 by 2030, Stellar may have a future very well. It is positioned in the peer-to-peer payment sector of crypto to outperform.

XRP and XLM serve very different functions, with XRP focused on transferring funds between financial institutions and XLM focused on the peer-to-peer sending of digital assets. However, the market capitalization of XRP is almost 10x higher than XLM’s, which may make this coin a better investment. 

XLM (Stellar Lumens) and XRP (Ripple) are both cryptocurrencies, but XLM aims to enable quick and affordable transactions while promoting financial accessibility, whereas XRP is primarily used for facilitating international payments and settlements in the financial sector.

In 2023, XLM has a circulating supply of 27.24b coins with a max supply of 50b XLM. The more coins a blockchain issues, the less the coins are worth.

Picture of Mike Martin

Mike Martin

Mike Martin serves as the Head of Content for tastycrypto. Before joining tastycrypto, Michael worked in the active trader divisions of thinkorswim, TD Ameritrade, and Charles Schwab. He also served as a writer and editor for projectfinance.

Michael has been active in the crypto community since 2017. He holds certifications from Duke University in decentralized finance (DeFi) and blockchain technology.


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