Bitcoin Stack (STX) Smart Contract Layer Soars 6x Since Early 2023

The price of Stacks (STX) is rising fast and attracting investors’ attention. As of March 18, the cryptocurrency was up 25 percent from the previous day and has increased sixfold in value since the beginning of the year. According to Coingecko, STX has a market cap of over $1.7 billion and shows no signs of slowing down.

the stack

Source: Tradingview

One reason for its growing popularity is that Stacks provides a smart contract layer for Bitcoin, which has long been considered the gold standard in the crypto world.

Stacks is an open source network for decentralized applications and smart contracts using the security of the Bitcoin blockchain. This means it can be used for a variety of purposes beyond Bitcoin payments, including DeFi applications.

As the popularity of DeFi continues to expand, Stacks has attracted the attention of more investors. The network’s DeFi ecosystem reserves increased across the board, with STX liquidity staking protocol “ALEX Lab (ALEX)” up more than 30% from the previous day, and lending service “Arkadiko Finance (DIKO)” up 20%.

One of the main advantages of Stacks is scalability. Stacks provide an additional layer 2 solution when Bitcoin is struggling with scalability issues. This becomes even more important as the NFT Ordinals distribution protocol evolves, which is currently under development and faces scalability challenges. According to Stacks co-founder Muneeb Ali, solutions like Stacks will become increasingly important in the coming years.

As reported by DeFillama, the total value locked (TVL) in the Stacks network is $35.4 million, which is small compared to the Ethereum ecosystem. However, this figure is about 5 times higher than the $7 million or so in early February 2023. Additionally, lending protocols on Stacks and TVL on DEXs saw double-digit growth in the last week.

the stack

Source: DeFillama

To this end, Stacks is constantly improving its technology to better serve its users. In the upcoming 2.1 update, Stacks will introduce Stacking 2.0, allowing the addition of automatic “filling” and mixing stacking. This will increase the profitability of Stacks and have a positive impact on the capital efficiency of the Arkadiko self-pay lending protocol on Stacks.

Additionally, version 2.1 enhances interoperability between Stacks and Bitcoin. It allows sending Bitcoin’s native asset, Ordinals, to STX-based wallets such as Hiro and Xverse. On the other hand, since Stacks assets can be directly added to a Bitcoin address, users and developers will only use one Bitcoin address to use the Stacks application.

Looking ahead, Stacks is planning a larger update called “Nakamoto,” which will roll out in the fourth quarter of 2023. This update will introduce sBTC in Stacks, enabling trustless writes to the Bitcoin network, unlocking Bitcoin liquidity with a market cap of 69 trillion yen ($523 billion), and providing a use case for DeFi operations. It will also greatly increase the transfer speed of the Stacks blockchain.

Overall, Stacks is quickly becoming a major player in the crypto world. Their advanced technology and focus on scalability and interoperability are attracting investors and users. With updates and new features rolling out, the future looks bright for Stacks and its growing community of supporters.

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Ming Ying

according to Kyptos

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