Stellar Network is an open-sourced and decentralized protocol of digital currency. Stellar Network, the non-profit had its initial release in 2014 and has been distributing Lumens (its digital currency unit) since then. It was originally written by Jed McCaleb, the same who was the founder of Mt. Gox and co-founder of Ripple. Recently, there have been questions raised on the degree of decentralization of Stellar.
The Shutdown Incident
Stellar Network, whose price is the US $0.13 and an impressive market cap of $2.5 billion went down for 67 minutes on 15th May. This was because of the failure of the consensus system of the website. When it was down, people immediately pointed out that there wasn’t sufficient information provided by the website and the number of nodes was less. This shutdown raised many eyebrows as it was unusual for a decentralized network to go down.
Stellar Network, in a blogpost, released a statement saying that it was because of failure of some nodes taking up too much responsibility. The statement given by the Network is as follows :
“The halt didn’t occur because Stellar’s Consensus Algorithm failed . In fact, the consensus worked as originally intended. For Stellar’s system, a temporary halt is often preferable to the confusion of a fork. However, the incident from yesterday shows that Stellar must look for better tooling around uptime. The network needs better status monitoring for its validators. Stellar has to ensure that it is easier to re-initiate a validator after it going down.”
The reality of the Situation – As Claimed By The Network
Stellar Network, in their Developer Blogspot, went into detail about the incident and told that being centralized is the last thing that they want their network to be. Also, they pointed out that the incident took place due to the opposite being true, as there is the presence of many nodes and some nodes took too much responsibility. Their consensus was upgraded back in April 2015 and it went live in November of the same year. This is the first case of the consensus system not working since then.
While Stellar themselves claim this not being a case of centralization of the network, it is still unclear about what really happened and opinions are still divided on the matter. Also, this is not the first time Stellar has been criticized for being centralized. Earlier, XLM and Stellar both were criticized for being too centralized by a group of researchers.
The price prediction due to this incident will be based on the XLM situation when it faced criticism as mentioned above. Well, clearly XLM wasn’t affected by it and Stellar won’t mind going down a little bit due to the incident as the market has slowed down as a whole.