Stacks is a Layer 1 blockchain that brings smart contracts and decentralized applications to Bitcoin. Unlike sidechains, Stacks settles all transactions on Bitcoin through its unique Proof of Transfer (PoX) consensus mechanism, where miners spend BTC to mine STX blocks, and STX stackers earn BTC rewards. This creates a direct economic link between Stacks and Bitcoin without modifying Bitcoin's protocol. Stacks uses the Clarity smart contract language, which is decidable and allows developers to see the exact cost and behavior of their code before execution. The Nakamoto upgrade (released in 2024) brought fast blocks, 100% Bitcoin finality, and sBTC, a decentralized, programmable Bitcoin peg that enables Bitcoin DeFi. The ecosystem includes DEXes, lending protocols, NFT marketplaces, and BRC-20 related projects, all anchored to Bitcoin's security.
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