Stacks' Native Token, STX, Outperforms Bitcoin with a 400% Rally, Anticipation Builds for Nakamoto Release
Summary:
The Stacks layer 1 smart contract platform's native token, STX, has seen a 400% increase since October 2023, outperforming Bitcoin with a 2,600% rise in trading volume. This surge is linked with anticipation of the upcoming Nakamoto Release, which is expected to accelerate transactions and introduce a Bitcoin-pegged token, sBTC. Furthermore, enhanced network activity on Bitcoin and a significant rise in the total value locked (TVL) on the Stacks platform demonstrate increased user interest and trust in this blockchain network.
STX, the original cryptocurrency of the Bitcoin-focused Stacks layer 1 smart contract platform, has generated significant buzz in the cryptocurrency marketplace following a phenomenal 400% surge since October 2023. Over this period, STX has experienced an impressive 2,600% increase in trading volume, reaching $437.6 million on Feb. 22. Outshining Bitcoin's (BTC) 90% rise since Oct. 15, 2023, STX's annual growth rate in 2023 stood at a stunning 600%, as reported by Messari.
The boom in Bitcoin layer-2 projects, such as Stacks, has not just been driven by the presence of spot Bitcoin ETFs, now managing over $10 billion in assets, but also by initiatives targeting Bitcoin Ordinals, which carry a $2.5 billion market cap.
Stacks is notable for its focus on Bitcoin layer 2 smart contracts, providing support for key decentralized finance (DeFi) components akin to those found in layer 1 networks like Ethereum and Solana. Stacks facilitates users in creating custom cryptocurrencies mirroring Ethereum’s ERC-20 tokens and stablecoins, wrapped Bitcoin, and nonfungible tokens. Moreover, it features a decentralized exchange (DEX) and a liquid staking protocol (LSP).
The augmented interest in Bitcoin layer 2s is attributed to their unique ability to enhance the network’s value offering by facilitating more transactions. The growing network activity is largely owed to the popularity of the BRC-20 token standard and Ordinals inscriptions.
Ahead of the Nakamoto Release, a crucial update expected to occur before this year's Bitcoin halving in April, STX has experienced a significant price rally. The anticipated upgrade will not only expedite transactions but also introduce a new Bitcoin-pegged token, sBTC. This innovation appeals to Bitcoin owners looking to engage with smart contracts and developers eager to construct applications on Bitcoin.
The slew of advancements introduced by Stacks has seen the platform gain traction among users. Cryptocurrency analytics firm Artemis reports a rise in the number of daily active addresses on Stacks, soaring from 961 to over 4,000 within 90 days. Concurrently, daily transactions have leapt from approximately 8,340 to 33,000 over the same timeframe.
An essential benchmark of user interest and their degree of faith in a blockchain network is the total value locked (TVL) on the given platform. As per data from DefiLlama, Stacks’ TVL has marked an 830% increase, from $12.35 million on Oct. 15, 2023, to $114.87 million on Feb. 22. This remarkable TVL surge denotes a significant cash inflow into the Stacks DeFi ecosystem, highlighting investor optimism and active participation in DApps.
The approval of Bitcoin ETFs in January 2023 and the expansion in Bitcoin ETF inflows have been key catalysts in driving the BTC price to a two-year high of $49,000, subsequently pushing STX to reach the highest price seen in nearly two years at $2.06. More recently, STX followed the remarkable BTC rally, which reached $53,000 on Feb. 20, registering an 85% increase over the past month to reach a new high at $2.90.
As anticipation for a continued surge in Bitcoin price in 2024 and the promising developments in the layer 2 Bitcoin landscape persist, Stacks might further fortify its position as one of the leading projects in the layer 2 Bitcoin domain. Note that this article only provides informational value, and investors should engage in their personal research before making any investment decisions, as it involves potential risks.
Published At
2/22/2024 9:54:43 PM
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