Stacks, formerly Blockstack — an open-source network for building decentralized applications — has an ambitious vision to bring smart contracts and decentralized finance to the Bitcoin (BTC) network.
On Thursday, the developer community celebrated the launch of Stacks 2.0, a bridging toolkit that allows developers to build on Bitcoin.
Stacks 2.0 is described as a layer-one blockchain with a native bridge to Bitcoin. The toolkit is underpinned by the Clarity smart contract language, a joint open-source protocol supported by Blockstack and Algorand.
From an industry perspective, the launch of Stacks 2.0 is significant for several reasons. On one hand, it expands Bitcoin’s scripting language, allowing developers to build smart contracts and other innovative tools on top of the blockchain. By bringing more use cases to Bitcoin, Stacks 2.0 could potentially dilute the value proposition of competing chains. This could secure Bitcoin’s already dominant position as the world’s largest blockchain and cryptocurrency.
Muneeb Ali, Stacks' co-founder and Hiro PBC CEO, told Cointelegraph that optimizing the Bitcoin network doesn't necessarily spell the end of other smart contract platforms but rather "provides more optionality."
"Like anything, different tools for different goals," he said. "Those with certain goals likely will choose Bitcoin, those with different goals or who operate in a different fashion or in a different environment may choose others."
Blockstack told Cointelegraph that it’s celebrating the launch with a one-day virtual event headlined by several industry partners, including Foundry, OKCoin, Staked, Blockchain.com, Blockfolio, Floating Point Group and Blockdaemon.
“The launch of Stacks 2.0 marks a future that many didn’t think was possible, a future where people can build on Bitcoin and bring their innovative ideas to the Bitcoin network, unlocking its full potential.”
The Stacks 2.0 unveil follows many months of testing and audits centered around proof-of-transfer, or PoX, the protocol’s new consensus mechanism. As a novel mining system, PoX utilizes the proof-of-work consensus to create new blockchains that are rooted in Bitcoin's security.
Ali said PoX “has the potential to enable an economy around Bitcoin and actually secure the future of the internet on Bitcoin’s blockchain.”
Stacks 2.0 attempts to bring Bitcoin full circle. As the flagship cryptocurrency, Bitcoin has secured a market cap of $700 billion based almost entirely on its store-of-value characteristics. Along the way, countless projects have launched to fill the perceived void left by Bitcoin — namely, smart contracts, DApps and, more recently, DeFi.
Blockstack believes its innovation can help activate the hundreds of billions locked up in passive Bitcoin capital:
“Moving forward, this massive amount of liquidity can be used to build native Bitcoin DeFi applications rooted in the security of Bitcoin and in a language (Clarity) designed to be predictable and secure, both advantages over current DeFi tooling.”
Ali elaborated that most capital on the Bitcoin network is "simply sitting in wallets or cold storage." On networks like Ethereum, capital is being put to work, particularly in DeFi. He added:
"We believe the tools available in Stacks 2.0 will give developers the ability to build more things people can use with the capital they have stored on BTC and do not wish to move it in order to do so."
Although Bitcoin has carved out a strong narrative as digital gold, the Stacks 2.0 vision attempts to bring more utility to the original cryptocurrency, which could broaden its use case beyond just a store of value.
"I do think that it can enhance the Bitcoin narrative," Ali said. In addition to making Bitcoin more valuable, Stacks 2.0 helps Bitcoin "move beyond simply being thought of as digital gold or a reserve currency and instead as something that can be the foundation for a better internet."