• Stacks is a Bitcoin layer-2 blockchain protocol that is improving the functionality of Bitcoin without the need for a fork.
• It uses the Proof-of-Transfer (PoX) consensus mechanism and its native digital token is called STX, which powers the Stacks ecosystem.
• STX has a total market capitalization of over $1.5 billion and it enables its holders to earn BTC via a process known as stacking.
What is Stacks?
Stacks is a Bitcoin layer-2 blockchain protocol designed to improve the functionality of Bitcoin without needing to fork the network. It uses the Proof-of-Transfer (PoX) consensus mechanism and its native digital token, STX, powers its ecosystem.
What is STX?
STX is the native digital token on Stacks and it has a total market capitalization of over $1.5 billion at present time. Its primary purpose is to enable holders to earn BTC via stacking, while also being used to execute smart contracts written in Clarity programming language on the Stacks blockchain, process transactions, and reward miners on the network.
Proof-of-Transfer Explained
Crypto networks use consensus mechanisms to secure blockchains and two of these are Proof-of-Work (PoW) and Proof-of-Stake (PoS). PoW requires miners to solve math puzzles in order to validate transactions while PoS relies on stakers for verification instead. Stacks uses what’s called “Proof-of Transfer” which combines aspects from both PoW and PoS in order to provide an energy efficient consensus mechanism with high security guarantee features like replay protection or chain locks enabled by strong economic incentives for miners/stakers who participate in validating transactions on the network.
Advantages of Using Stacks
The major advantage of using Stacks rather than other Layer 2 protocols such as Lightning Network or Liquid Network is that it does not require users to be online all times in order for them to receive payments: thanks to its “chainlocks” feature which provides increased security against double spends attacks, payments can still be received even if one user goes offline as long as another party holds their funds securely until they come back online again. Additionally, because most operations are executed off chain this allows for faster transaction speeds compared with other Layer 2 protocols while still retaining high levels of security due to their reliance on Bitcoin’s mainchain infrastructure as well as their own unique consensus algorithm based around “proof of transfer” concept which requires users who want transact tokens have enough coins in their wallet before doing so thus providing additional protection against fraud/theft attempts made during transfers between wallets or exchanges etc…
Types of DApps Found In The Ecosystem
There are various types decentralized applications available within the Stacks ecosystem such as games like Crypto Kitties where players can buy virtual cats with cryptocurrency; prediction markets like Augur where participants can bet on future outcomes; financial services like MakerDAO which provides loans using cryptocurrencies; storage solutions like Filecoin where users can rent out unused hard drive space; censorship resistant social networks like Mastodon that allow users post messages freely without fear censorship etc… All these projects make use robust tools provided by Blockstack platform such as Clarity smart contract language which helps developers create powerful decentralized apps without having worry about any possible loopholes left open hackers exploit maliciously gain access sensitive data stored within them etc…
