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NEW YORK (InsideBitcoins) — Back in February the world was teased with a cryptic message about a new digital currency project Ripple and Mt. Gox founder Jed McCale was developing with Stripe CEO Patrick Collison. There were few details other than a single post on McCale’s website, secretbitcoinproject.com:
“When I sold Mt. Gox a few years ago, Bitcoin was trading at less than a dollar. Today Bitcoin exists in a new environment. Mt. Gox is struggling to keep up. Now, I am building something that will be better for Bitcoin and better for you. I’m looking for alpha testers. – Jed”
McCale is careful to note, as in his message above and in continuing public disclosures, that his affiliation with Mt. Gox ended long before the defunct exchange became a global icon as a Bitcoin failure.
And now, six months after his mysterious teaser, the founders have finally released details about the new not-for-profit San Francisco startup, named Stellar.
An improvement over Bitcoin
Before founding Stripe, Collison envisioned an innovative system that would be an improvement over Bitcoin. Collison says that he discussed the concept with McCale several months ago.
“We were having these conversations, and it was so clear what Stripe thought should exist, and what he thought should exist, and they almost precisely [matched up],” Collison told Fortune. “So it made sense to decide to do something together.”
Stellar is described on the company’s blog as “A decentralized protocol for sending and receiving money in any pair of currencies. This means users can, for example, send a transaction from their Yen balance and have it arrive in Euros, Yen, or even bitcoin.”
Stellar employees are confident the new exchange – for digital as well as fiat currencies — will be an attractive Bitcoin rival. Joyce Kim, executive director of the Stellar Foundation, told The Wall Street Journal that users can access Stellar to transfer payments with other currencies. “This is probably the best way to bring the best of both worlds together,” Kim said.
She added that Stellar users won’t need to purchase the currency upfront. McCale wants to disassociate himself from Ripple, the currency exchange he founded in 2011. Ripple users were reluctant to trust the network after McCale and other founders retained most of the currency for themselves.
Free cryptocurrency for (practically) everyone
The Stellar Foundation is gifting 95% of its 100 billion coins during the initial launch. Half of these coins will be given to users through Facebook, while the remaining coins will be donated to charity.
Kim added that giving the currency away will build trust and benefit organizations fighting poverty in the world’s poorest regions. The cost-free nature will also help Stellar access people that can’t afford bitcoin transaction fees.
Collison admits Stellar will take time to gain acceptance, if it does at all. The Bitcoin community still only has 1.2 million users, but its growth has forced many people to reevaluate their perception of money. Paypal, Neteller and other leading online payment processors believe Bitcoin can revolutionize online commerce. The growing acceptance of Bitcoin shows there is a demand for cryptocurrrencies, which may bode well for Stellar.