Beyond the Hype: Analyzing XLM’s Response to Stellar’s Protocol 20

Estimated read time 4 min read
  • On September 20, Stellar (XLM) completed its protocol 20 upgrade, geared at introducing support for businesses and developers building on the Stellar network
  • Stellar in its blog post on September 18, revealed that developers may now access support for Soroban smart contracts on the network.

On September 20, Stellar, a blockchain platform renowned for its ability to facilitate rapid and cost-effective cross-border transactions using its native currency, XLM, is set to unveil the testnet upgrade for Protocol 20. This development marks a significant step in preparing for the eventual activation of the Soroban smart contracts platform on the mainnet.

The Role of Stellar Core

As outlined in a document dated September 18, the primary objective of this testnet upgrade is to introduce candidate versions of both Stellar Core and Horizon. Stellar operates as a blockchain network that relies on a distributed network of nodes for validating transactions and maintaining the network’s security. The synchronization of validators is achieved through the Stellar Core, which serves as the foundational backbone of the entire network, ensuring the blockchain’s integrity.

Stellar Horizon plays a pivotal role as an interface that streamlines the interaction between applications and developers with the mainnet through APIs. By simplifying the complexities associated with blockchain interaction, Horizon empowers users to deploy applications with greater ease, promoting accessibility and user-friendliness.

Once the stable version becomes available, Validators will play a crucial role in determining the timing of incorporating the tested upgrades into the mainnet. The blockchain developer acknowledges that the Protocol 20 upgrade will introduce new configurations, necessitating thorough discussions and adjustments through a voting process. The Stellar Network will provide a clear timeline for implementing these modifications before deploying them to the mainnet.

Soroban Smart Contracts and Incentives

Stellar introduces Soroban as a smart contracts platform designed for scalability and practicality, seamlessly integrating with the existing Stellar blockchain infrastructure. This innovative portal is presently undergoing testing in Stellar’s testnet, known as Futurenet.

Stellar highlights several core features of its smart contracts, including multi-core scaling and an optimized fee model, which enhance their performance by eliminating intricacies like “serialization loops.” Unlike Ethereum’s layer-2 platforms like Arbitrum or Polygon, which operate independently, Soroban is set to achieve full integration with Stellar while remaining an open-source solution.

To drive Soroban adoption, the Stellar Development Foundation has introduced a remarkable $100 million Adoption Fund. This initiative encompasses a wide array of programs aimed at supporting various aspects of Soroban adoption. Some of these programs are already underway, while others are still in the pipeline. This substantial fund serves as a comprehensive approach to incentivizing and promoting the widespread use of Soroban within the Stellar ecosystem.

 Stellar Joins Forces with WEF

The Stellar Development Foundation (SDF) has embarked on a global mission by becoming a part of the World Economic Forum’s (WEF) Humanitarian and Resilience Investing Initiative.

In this collaboration, SDF holds the unique position of being the exclusive blockchain representative within a consortium of global innovators. Together, they are dedicated to addressing the urgent needs of the world’s most vulnerable populations.

Confronting Systemic Challenges

The primary focus of this initiative is to confront the deep-seated challenges faced by approximately two billion individuals worldwide who grapple with poverty and insecurity. The foundation’s blog post emphasizes that SDF’s commitment to this endeavor is founded on a shared aspiration to harness the transformative potential of blockchain technology. Their goal is to address real-world problems and establish inclusive financial infrastructures.

The World Economic Forum is renowned for its role in advancing international collaboration. It operates at the crossroads of public and private sectors to tackle pressing global issues. The organization has a track record of developing and implementing sustainable solutions to assist communities facing adversity. Importantly, its approach focuses on effecting systemic change rather than providing temporary relief.

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