Bitcoin (BTC) News: Impacts of Stacks’ Nakamoto Upgrade Amidst STX Decline
Bitcoin Layer-2 Stacks Initiates Nakamoto Upgrade
The Nakamoto Upgrade marks a new era of scalability for decentralized finance (DeFi) within the Bitcoin ecosystem and is one of the most significant changes to the Stacks network. Activated on Wednesday, this upgrade enhances transaction speeds and reduces settlement times.
Significant Improvements
- Standard Bitcoin settlement times previously ranged from 10 to 30 minutes or more.
- The Nakamoto Upgrade has slashed this to around five seconds—an impressive 10X improvement.
- This enhancement significantly boosts the usability of the Stacks network.
The upgrade received strong community support earlier this year and sets the stage for several key developments in the Stacks ecosystem. One major upcoming event is the introduction of sBTC, a decentralized asset backed 1:1 by Bitcoin.
Impact on Stacks Network
Stacks is specifically designed to enable smart contracts and dApps to use Bitcoin as a secure base layer. By extending Bitcoin's capabilities without altering it, Stacks unlocks billions in latent capital, allowing for a more dynamic and functional ecosystem.
Despite positive changes from the Nakamoto Upgrade, the total value locked (TVL) on the Stacks network has decreased by over $7 million, dropping from $98.10 million to $90.62 million. This decline in TVL indicates that the upgrade’s immediate impact on market confidence was mixed, even as the network sees notable improvements.
BeInCrypto data shows STX, the native token of the Stacks network, is trading for $1.59 at press time, down 8.5% since Thursday session opened.
Bitcoin L2s Gaining Momentum
Bitcoin Layer-2 solutions are progressively gaining popularity and have attracted significant investment. As BeInCrypto previously reported, VC funding towards Bitcoin L2s continues to grow, collectively raising an impressive $94.6 million in the second quarter of 2024. This represents a substantial 174% increase quarter-over-quarter.
Experts revealed that at least 65 projects have identified themselves as Bitcoin Layer-2.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.