Read Stacks in One Article: Bitcoin's Enhancement System

We first learned of the name Stacks in books—specifically, Muneeb Ali, its founder, in George Gilder's book Life After Google. We then participated in the token offering of STX in 2019 - notably the first fully regulated and registered token offering, but we did not move our allocation for many years. As it turns out, the STX team has been working on building a very good new protocol.

You can ask your financial advisor what to invest in and get a big return. Finally, full disclosure - we also maintain a position in STX.

Having said that, we can now talk about the exciting stuff. The basic promise of Stacks is simple: to build a programmable, composable, secure and decentralized ecosystem that inherits Bitcoin.

To be fair, this concept is not too far from the idea of sidechains and Rollups popular in the Ethereum world. While Ethereum itself is programmable by design, its raw form has always had issues with speed and cost. Everyone knows about these problems and complains about them. In contrast to competing "layer 1s" such as Solana and Avalanche, which exist as inherently independent blockchains of Ethereum, Rollup's idea is to have a large portion of the computation done off-chain, while keeping the results in the Ethereum master. On-chain "settlement", thus avoiding the cost of on-chain processing.

So people can’t help but say that the relationship between Stacks and Bitcoin is similar to the relationship between sidechains/Rollups and Ethereum, but to say that is outrageous.

Stacks has its own chain, compiler and programming language called Clarity. It runs in sync with Bitcoin and is marked on Bitcoin’s block asset (which remains the number one market cap around) to ensure its transactions and integrity.

As usual, this incident has us revisiting old knowledge and writing about Stacks. Why write an article now? The reason is that the CityCoins use case has the potential to push Stacks into the mainstream.

In this article, we will clarify a lot of things.

Bitcoin, Stack and PoX

We've written a lot about Ethereum composability on this blog because it's a lot.

On the other hand, Bitcoin has always been mentioned in our macroeconomic articles so far: it's an alternative to gold, a store of value, and some celebrities buy it as an inflation hedge, but otherwise , it's not as exciting as what's happening in the Ethereum ecosystem.

This is to be expected, Bitcoin hasn't really changed much since its first version - while there have been forks that have tried to increase transaction speed or reduce transaction costs, they have mostly disappeared, with only some having Forks for speculative purposes survived. Bitcoin remains a "peer-to-peer electronic cash system," as written in the original white paper. Although its use has gone beyond this definition, it has become a store of value. But its essence (the code it runs) is still simple, it has no smart contracts, no specialized calculations, no bells and whistles.

If we can accept the fact that Bitcoin is arguably the most secure and immutable chain in existence, although it is bulky, then the question is whether there is a better new blockchain - one with pleasant synergies It can provide all the expected benefits of decentralized computing (low cost, reasonable throughput, etc.) without increasing the risk of centralization, avoiding the basic landslide of history being rewritten by a small number of validators.

And that's exactly what Stacks promises - programmable, decentralized computing (similar to Ethereum), but potentially cheaper and faster (similar to more centralized tokens), but with features like The censorship resistance of a truly decentralized, immutable protocol like Bitcoin. Is it perhaps the best coin in the world?