Bitcoin, with smart contract capability–that’s what Stacks are trying to do. Our Bitcoin maxis will like this one.
Now, before going further, I’ll state that I believe every blockchain and project has its own purpose. The genesis of Bitcoin was to be a peer-to-peer monetary transaction platform. Over time, its use case has changed, leading it to become one of the world’s most thorough stores of values.
Now, Bitcoin has many limitations: with speed, affordability, and environmental impact being some of them. This has led to more projects emerging in the crypto space- some made to be more environmentally friendly, some to be faster, and some to develop the product further by making it smarter.
An example is Ethereum. It is to BTC what the iPhone is to the house phone. Its technology is different but retains some of the same features.
Now, many hardcore Bitcoin fanatics believe that the purity of Bitcoin makes it the best candidate for everything. Stacks believes the same thing, so they are set on bringing smart contracts and decentralized applications to Bitcoin.
Other people and platforms have attempted this before, which is why we have many forks and iterations of Bitcoin, but Stacks is attempting to do this without changing any of the features that make Bitcoin, Bitcoin. Notably its security and stability.
The STX Token
The platform is powered by the Stacks token (STX), which is used for fueling the execution of smart contracts, processing transactions, and registering assets on the Stacks 2.0 blockchain. Think of it like Ether for Ethereum. Investing in STX is like investing in the power source of the Stacks ecosystem.
What are the Tokenomics of Stacks?
It is expected that there will be 1.82 billion STX in circulation by 2050, compared to around 900 million today. This makes it an inflationary asset.
1,000 STX per block will be released in the first four years, decreasing to 500 STX/block in the following four years, 250 STX/block in the four years after that, and then 125 STX/block after that in perpetuity. This information from the whitepaper echoes the halving of Bitcoin every four years.
Allocations
6.6% to the founder
7.9% to the Stacks team
Proof of Transfer (PoX)
Stacks are taking what makes Bitcoin so powerful and elevating it by adding more functionality without needing to fork or change the original Bitcoin blockchain.
It connects directly with the Bitcoin blockchain through its proof-of-transfer (PoX) consensus mechanism.
In PoX miners pay BTC to mint new Stacks (STX) tokens. Then STX token holders stack (not stake) their tokens to earn Bitcoin as a reward.
Clarity
A smart contract programming language designed to be both secure and easy to build with. This programming language is also used by the well-known project Algorand.
Regulation
We’ve all seen how bs the SEC can be. However, we cannot rule out the impact regulation could have on crypto. Positively, Stacks was the first cryptocurrency to receive SEC qualification for a sale in the United States!
How Is the Stacks Network Secured?
Stacks uses the Bitcoin blockchain as its base layer. Therefore it uses the Bitcoins proof of work consensus mechanism as its foundation, plus the aforementioned proof of transfer mechanism (PoX)
