Stacks (STX) – All you need to know

What is Stacks?

Stacks is a platform for building decentralised applications on top of the Bitcoin blockchain. It works like a translator, allowing those apps to benefit from the security and privacy that the blockchain provides. Anyone who holds STX, the cryptocurrency that powers the platform, can earn interest that’s paid in Bitcoin.

It’s that feature which is most notable and unique about Stacks. Many platforms offer incentives to users who hold a cryptocurrency in the form of interest but usually it’s paid in kind. Stacks, meanwhile, offers up Bitcoin as a reward instead.

The other aspect that makes Stacks stand out is that it combines the features of Ethereum – essentially the ability to build apps on top of it as if it were an alternative internet – with the extreme security and payment mechanism of the Bitcoin blockchain. Most other platforms do the reverse: start with the app platform and try to increase security or add payment features on top.

How does Stacks work?

By using something called ‘proof of transfer’, or PoX, to bind itself to the Bitcoin blockchain. Instead of needing new ‘miners’ who use their computer power to create new blocks, PoX essentially pays existing Bitcoin miners to get the benefits of the work they’re doing already.

This is important because the whole thing is secured by Bitcoin miners sending Bitcoin to Stacks, and being paid in Stacks for the work they do. This exchange in value allows the Stacks platform to reward users with Bitcoin.

Stacks also has its own blockchain, which acts like a layer on top of Bitcoin so that developers can create apps. It’s created its own programming language to make the process as simple as possible.

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