Stacks (STX), the decentralized finance platform built on Bitcoin, is gaining attention for its innovative approach. Co-founder Munib Ali recently shared insights about the platform’s mission and its unique take on Bitcoin-based DeFi in an exclusive interview with BeInCrypto.
Stacks Stays True to Its Goal
Stacks’ journey in the world of decentralized finance has been characterized by a consistent commitment to its original vision. Ali revealed that the upcoming Nakamoto Release, scheduled for the first quarter of the next year, is set to bring that vision to life.
Addressing Bitcoin’s Limitations
Munib Ali discussed how Stacks aims to overcome the limitations of the Bitcoin network. The primary goal is to offer faster transaction speeds and lower fees through Layer 2 solutions while ensuring seamless transferability between Layer 1 and Layer 2.
Clarity Language for Enhanced Security
Ali emphasized that Stacks offers an alternative to Ethereum, allowing developers to build applications using the Clarity programming language. He highlighted the enhanced security offered by Clarity, making it a safer choice for DeFi projects compared to Ethereum’s Solidity language.
Navigating Decentralization Challenges
When questioned about potential delays in Stacks’ upgrades, Ali explained that Stacks operates within a decentralized ecosystem, which differs significantly from centralized entities like Solana Labs. Due to regulatory considerations, Stacks decentralized before its mainnet launch. This approach means that upgrades are reliant on individual developers rather than a centralized authority. Ali acknowledged that this unique approach presented its own set of challenges but emphasized the importance of the ecosystem learning to collaborate effectively.
Bitcoin DeFi Necessity
Stacks has a close relationship with Bitcoin users, but Ali addressed the skepticism from some Bitcoin Maximalists about Bitcoin DeFi. Despite resistance from this group, Ali stressed the importance of Bitcoin DeFi, pointing out that it opens up new possibilities and choices within the crypto industry.
Three Key Options for the Future
Ali explained that, at a higher decision-making level, there are three distinct options for the future of DeFi. The first camp supports Layer 2 solutions like Arbitrum or Optimism in Ethereum. The second camp favors alternative Layer 1 networks such as Solana and Avalanche. The third camp chooses Layer 2 solutions built around the Bitcoin ecosystem. The competition between these options will be an intriguing aspect to watch in the evolving DeFi landscape.
Bitcoin Spot ETF and Stacks
Regarding the potential introduction of a Bitcoin spot ETF, Ali noted that Bitcoin lacks a native programming language for developers, making it difficult to create certain financial products. ETFs are expected to generate significant interest in Bitcoin, but Stacks intends to complement rather than compete with such products by focusing on its unique capabilities.
The Impact of KYC in DeFi
Addressing the issue of customer identity verification (KYC) and anti-money laundering (AML) requirements in DeFi, Ali pointed out that Bitcoin’s regulatory status is clear, making it less attractive to scammers. However, the broader crypto community has varying opinions on KYC, and these concerns may extend to Layer 2 solutions in the future.
Bitcoin Maximalists and Their Role
Ali shared his thoughts on Bitcoin Maximalists, noting that while Bitcoin offers stability as Layer 1, it can sometimes resist change and upgrades. He highlighted the importance of a thriving developer community and ample resources to support innovation, an area where Ethereum has excelled.
The Korean Market’s Significance
Ali expressed intrigue about the Korean market, emphasizing that a substantial percentage of STX trading volume originates from Korea. He acknowledged the strong organic interest from Korean traders and expressed a desire to further engage with the local community. Additionally, Ali mentioned the recent launch of Trust Machine’s Bitcoin wallet service, leather.io, and its potential to resonate with the Korean audience.
In conclusion, Stacks’ commitment to bringing DeFi to the Bitcoin ecosystem presents exciting opportunities and challenges. As the crypto industry continues to evolve, Stacks aims to play a pivotal role in expanding the possibilities for developers and users, particularly within the Korean market.