Stacks (STX)

Smart Contracts and dApps

Stacks enables developers to build smart contracts and decentralized applications (dApps) that run on Bitcoin. This allows Bitcoin to be used for more than just digital gold by adding programmable features.

Decentralized Finance (DeFi)

Stacks extends Bitcoin’s use cases into DeFi, allowing users to create and use financial services like lending, borrowing, and trading without intermediaries.

NFTs and Digital Assets

Stacks supports the creation and transfer of NFTs (non-fungible tokens) and other digital assets secured by Bitcoin addresses, making these assets more secure and connected to Bitcoin.

Stacking and Rewards

Holders of STX tokens can lock (or "stack") their tokens to help secure the network and earn Bitcoin rewards in return, providing a way to earn passive income.

Bitcoin Integration

Stacks uses a unique Proof of Transfer (PoX) consensus that links its network to Bitcoin’s security, allowing transactions and smart contracts on Stacks to settle on the Bitcoin blockchain. This expands Bitcoin’s utility while keeping its security intact.

Pros

• Bitcoin Integration: Stacks works on top of Bitcoin, using its strong security and large user base.
• Smart Contracts and dApps: It brings smart contracts and decentralized apps to Bitcoin, allowing more advanced uses.
• Unique Consensus Mechanism: Uses Proof of Transfer (PoX), which is less energy-intensive than traditional mining.
• Earning Rewards: STX holders can earn rewards by staking their tokens on supported exchanges.
• Scalability: Designed to improve Bitcoin’s scalability by handling transactions efficiently with micro blocks.
• Wide Exchange Availability: STX tokens are available on major exchanges like Binance and Bybit.

Cons

• Network Congestion: Can experience slow transaction times and higher fees during busy periods.
• No Native Crypto Exchange Yet: There is no official crypto exchange built directly on the Stacks blockchain.
• Competition: Faces competition from other smart contract platforms with more established ecosystems.
• Regulatory Environment: Subject to changing global crypto regulations, which can affect its use and adoption.

Founders of Stacks

• Muneeb Ali: A computer scientist and entrepreneur who co-founded Stacks. He played a key role in creating the platform and its technology.
• Ryan Shea: An engineer and co-founder who helped start Stacks alongside Muneeb Ali.
• Peter Czaban: Also recognized as a co-founder involved in the early development of Stacks.

The project began in 2013, originally named Blockstack, and was founded by these individuals with roots at Princeton University.

Investors in Stacks

• Venture Capital Firms: Some of the key investors include Union Square Ventures (USV), Lux Capital, Zhen Fund, Foundation Capital, and Winklevoss Capital. These firms have provided significant funding to support the development of Stacks.

• Crypto Investment Groups: Digital Currency Group, HashKey, and SNZ are notable crypto-focused investors backing Stacks.

• Accelerators and Incubators: Y Combinator, a well-known startup accelerator, has also invested in Stacks.

• Other Investors: Recruit Holding and over 4,500 other individual and institutional investors have contributed to Stacks through token offerings and equity investments.

• Fundraising History: Hiro PBC (the company behind Stacks) raised over $75 million through multiple token sales and equity rounds, including a $15.5 million Reg A token offering.

• Investment Trusts: Grayscale has launched an investment trust for Stacks, allowing accredited investors to gain exposure through their platform.

These investors have helped Stacks grow as a Bitcoin layer-2 solution enabling smart contracts and decentralized applications.

Halal Status of Stacks

• Yes, Stacks is considered halal.
• It is an open-source platform that supports blockchain, DeFi, NFTs, and apps for Bitcoin.
• Its reward mechanism does not involve interest (riba), gambling (maisir), or excessive uncertainty (gharar).
• Staking Stacks tokens is also regarded as halal because it supports the network without violating Shariah principles.

Sources: Crypto Ummah