Original author: Nancy Lubale
Stacks (STX) makes 30% gain as mainnet upgrade and stablecoin launch approach
Original source: Cointelegraph
Compiled by: Koala, Mars Finance
The planned launch of a Bitcoin-pegged stablecoin, upcoming network upgrades, and BTC’s recent recovery could have something to do with STX’s 30% rally.
STX, the native token of the Bitcoin-centric Stacks Layer 2 smart contract platform, has ridden Bitcoin’s recovery, gaining around 30% over the past seven days.
STX/USD daily chart. Source: TradingView
The STX token price is $2.01, and trading volume has doubled over the same period, reaching $148.2 million on September 26. Let’s look at the factors behind STX’s upward momentum.
STX price rises as Satoshi upgrade approaches
The STX price increase comes as the community prepares for the upcoming Nakamoto update, which is less than 15 days away.
The Stacks Foundation has officially announced that the much-anticipated Nakamoto upgrade will be launched on October 9. The core developers have chosen Bitcoin block number 864864 as the hard fork block.
The upgrade is expected to improve decentralized finance (DeFi) on Bitcoin by speeding up transactions, introducing a new Bitcoin-pegged token called sBTC, and other improvements. SBTC will be used by Bitcoin holders who want to participate in smart contracts and developers who want to build applications on Bitcoin.
To celebrate this important milestone, the Stacks community will host more than 20 developer workshops around the world, including talks, live demos, and technical challenges, where participants can earn STX tokens.
To this end, Solana and Aptos announced the integration of the Bitcoin-backed asset sBTC, enabling developers to integrate sBTC into decentralized applications (DApps) on these platforms.
These integrations provide Bitcoin holders with more opportunities to leverage their assets beyond just holding or trading, such as participating in decentralized finance or participating in the NFT marketplace.
Network growth drives STX price higher
All of these developments have increased user interest in Stacks, with the blockchain seeing record-breaking smart contract deployments. In a September 7 X post, the Stacks Foundation announced that the number of smart contracts deployed on Stacks hit a record high of 1,400 in August, a 30% month-over-month increase.
Number of smart contracts deployed on Stacks per month. Source: Stacks Foundation
Additional data collected by DeFi analytics firm DefiLlama shows that DEX trading volume on the Stacks network has risen sharply, from $100 on September 17 to $31,480 on September 25, an increase of more than 31,300%.
DEX transaction volume. Source: DefiLlama
Another measure of user interest and trust in a blockchain network is the total value locked (TVL) on the platform. According to DefiLlama, Stacks’ TVL has grown 70% from $91.1 million on September 18 to $112.5 million at the time of writing.
Total value locked in Stacks. Source: DefiLlama
The increase in total value locked on Stacks indicates a massive influx of capital into the network’s DeFi ecosystem, highlighting investor confidence and active participation in DApps.
Bitcoin price rally drives STX higher
The approval of the U.S. spot Bitcoin ETF and the expectation of Bitcoin halving in the first quarter of 2024 pushed the price of BTC to an all-time high of $73,835 on March 14. Similarly, STX rose to an all-time high of $3.84 on April 1.
Recently, the Federal Reserve's 50 basis point rate cut and increased inflows into Bitcoin ETFs have driven BTC prices up strongly, reaching as high as $65,800 on September 26. STX once again followed in Bitcoin's footsteps, rising to an 8-week high of $2.07 on September 26.
STX/USD and BTC/USD daily chart. Source: TradingView
As market participants expect Bitcoin prices to continue to rise in the fourth quarter of 2024 and layer 2 Bitcoin development gains traction, Stacks is likely to further establish its dominance in the layer 2 Bitcoin space.
