What Is the Stacks Token?
The Stacks Token (STX) is the native token of the Stacks network (previously known as Blockstack). In an essence, Stacks is a scaling solution for Bitcoin. It revolves around bringing decentralized applications (dApps) and smart contracts to Bitcoin.
STX token powers the Stacks network and acts as a utility token. It’s used to execute various Stacks network operations including rewarding miners, executing smart contracts, stacking, and so on.
The Stacks price changes based on various market factors, thus, in order to make an informed purchase decision, make sure to check out the STX price history on the graph above.
Who Developed Stacks?
Stacks network was created by Hiro Systems PBC (formerly known as Blockstack PBC). Muneeb Ali and Ryan Shea are the founders of the project. Besides, the Stacks network was funded by such VC funds as Winklevoss Capital, Digital Currency Group, Y Combinator, and others.
The Main Features of Stacks Tokens
Overall, STX is a token that has more than one utility. The following are some of the main ones:
- Stacks tokens are like fuel for the Stacks platform. Thus, each time a user wants to use one of the Stacks’ apps, he/she has to pay a modest STX fee. The fees are then distributed as mining rewards.
- Stacks tokens can be used to earn Bitcoin. Essentially, STX holders have to stack the tokens to generate BTC. Just note that the process is called stacking rather than staking. Stacking is a part of the Stacks’ Proof-of-Transfer consensus mechanism. Basically, STX holders lock their tokens to generate rewards in Bitcoin. The platform offers up to 10% APY.
- Stacks tokens can be used in a huge variety of dApps created on the Stacks network. This includes buying NFTs in NFT markets, investing in DeFi applications, and so on.
Besides, Stacks coins can be minted by employing the Proof-of-Transfer mechanism. By 2050, over 1.82 billion STX tokens are estimated to be in circulation.
Also, always keep in mind that most crypto assets experience high volatility. The Stacks price is no different. It can be affected by many factors that influence the crypto market.
Lastly, note that Stacks was the first crypto asset to be approved by the Securities and Exchange Commission (SEC) for sale in the United States. This allowed the project to hold a Reg A+ sale cash offering, which was worth $28 million.
Is Stacks Token Secure?
Bitcoin is the base layer of the STX token. Thus, it means that the project is secured by a Proof-of-Work consensus mechanism. Besides that, the Stacks network has its own consensus mechanism called Proof-of-Transfer. In an essence, it’s a mining model that allows users to transfer BTC to other miners, this way getting access to mining STX. Overall, the STX token is secured using the Bitcoin network.
