Stacks

2024

Bitcoin

DeFi

Nash

<h2 id="key-points">Key Points</h2>
<ul>
 <li>The Stacks network, a Bitcoin layer-2 (L2) network, has achieved a record number of active users due to increased interest in Bitcoin-native decentralized finance (DeFi).</li>
 <li>High transaction fees on the Bitcoin network are pushing more activity towards L2 networks like Stacks.</li>
</ul>
<p>The Stacks network, a second layer solution for Bitcoin, has reached a record high of 122,497 active accounts in April. Active accounts refer to addresses that have executed at least one transaction. This new record indicates a growing interest in Bitcoin DeFi, also known as BTCFi.</p>
<h2 id="increased-activity-on-bitcoin-l2-networks">Increased Activity on Bitcoin L2 Networks</h2>
<p>This surge in activity comes after the 2024 Bitcoin halving and the introduction of Runes, a new protocol for issuing fungible tokens on the Bitcoin network. Bitcoin Runes and Ordinals are expected to drive more activity to Bitcoin L2 networks because high network fees on the Bitcoin network will make smaller transactions too expensive. Andre Serrano, product and partnership manager at Stacks, has shared this prediction.</p>
<p>“There will be a lot of asset issuance on Bitcoin L1, which will increase the transaction fees. This will make a lot of users and activity too expensive. As a result, shifting more of this activity to L2s will become necessary,” said Serrano.</p>
<h2 id="importance-of-bitcoin-l2s">Importance of Bitcoin L2s</h2>
<p>Bitcoin L2s, such as Stacks, are crucial for the development of BTCFi as they offer lower transaction costs and additional use cases for the Bitcoin network. For instance, Stacks allows for the creation of smart contracts on the Bitcoin network.</p>
<p>Serrano has stated that L2s are more significant for Bitcoin than for Ethereum, which already has inherent smart contract capabilities. He also mentioned that L2s are essential to scale the Bitcoin network beyond its current transaction limitations.</p>
<p>The BTCFi sector has received a lot of attention and enthusiasm across the crypto space. According to Nash Lee, co-founder of MerlinSwap, the development of BTCFi could match the innovation seen in Ethereum-native DeFi.</p>

Bitcoin DeFi Sparks Surge in Active Stacks Accounts: a Record Breaker!

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