Coinbase Earn: How Banks, Businesses, & People Use Stellar (Lesson 4 of 5)

Stellar is a platform that
aims to connect banks, businesses, and people,
far more efficiently than today’s financial infrastructure. Let’s take a bank,
a business, and a person — and show you how this works. First up, the bank. This is Main Street Bank.
To use the Stellar network, Main Street bank sets up
a Stellar account. Then using Stellar’s
built in tools, the bank hooks its
existing infrastructure into the Stellar network. Now the bank can take
its real world assets — like dollars, euros, or pounds —
and turn them into Stellar tokens. And their customers can deposit
a US dollar in Main Street Bank, and get a US dollar
token on Stellar in return. All Stellar tokens are exchangeable. And since exchanges happen
on the Stellar network. They only take a few seconds,
and cost a fraction of a penny. Anyone can transfer, store,
and trade Stellar tokens — just like Lumens, anywhere
on the Stellar network. So now the bank can take a dollar,
turn it into a token, transfer it around the world in
two to five seconds — and convert it back to a dollar again. For banks, Stellar
makes money transfers fast, simple, and inexpensive. Next up, the business. Let’s call it ABC technologies. ABC makes an app. They want to
make it possible for the app’s users to buy and sell
in-game items with each other using a single currency. To do that, they use Stellar
to create a new token called the ABC token. The ABC token is,
in effect, a new cryptocurrency running on Stellar. It isn’t backed by a real world
dollar like Main Street banks, but other than that, it acts
entirely the same. With Stellar, any business can
create new tokens to reward customers and create
new economies and markets, related to their brands. Finally, we have people. This is Li. She’s a big fan of ABC’S app and
she wants to buy a new avatar. Unfortunately, she doesn’t
have any ABC tokens left. So what does she do? She uses Stellar’s built-in
marketplace to buy some. Li has US dollar tokens
that she previously bought from Main Street Bank. She transfers those
into the ABC app, and instantly converts
them into ABC tokens to buy her favorite avatar. And if she has some
US dollar tokens leftover she can return
them to Main Street Bank and get her dollars back,
right in her bank account. Or she can hang onto them.
Or trade them for another token. Any asset can be turned
into a token on Stellar. Traditional currencies. Cryptocurrencies.
Real estate investments. So whether you’re a bank, a
business, or a person, Stellar makes it possible to quickly
and efficiently issue, exchange, and transfer tokens
in an entirely new way.

2 thoughts on “Coinbase Earn: How Banks, Businesses, & People Use Stellar (Lesson 4 of 5)”

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