Coin columns · Mainnet Province
Stacks: Smart Contracts for Bitcoin via Proof of Transfer
Miners bid BTC for blocks; STX stackers earn that BTC
Stacks is a blockchain that uses Bitcoin as its final record so that smart contracts and apps can run on top of it, and STX is its own coin. Its current mainnet, Stacks 2.0, opened in January 2021.
1. Who built it
Stacks grew out of Blockstack, a decentralised-internet project started in 2013 by Princeton graduates Muneeb Ali and Ryan Shea. In 2019 Blockstack became known as the first project to sell tokens under an offering framework qualified by the US Securities and Exchange Commission (Reg A+). It renamed itself Stacks in 2020 and opened the current mainnet in January 2021.
Today the Stacks Foundation, the developer Hiro and many Bitcoin app builders lead the ecosystem. STX pays fees and is used for stacking, and new STX issued as block rewards is set to stop at about 1.8 billion around 2050. On the Crypto Nation map, STX stands in the Mainnet Province as the city-hall tower of its own Stacks neighbourhood.
2. Proof of Transfer
Stacks uses a consensus method called Proof of Transfer. Miners compete for each Stacks block by bidding bitcoin, and that BTC is not burned but passed to holders who lock up STX. Instead of a new mining race, Stacks borrows the work Bitcoin already does.
Locking STX this way is called stacking, and participants are rewarded in BTC. Smart contracts are written in Clarity, a language designed so that outcomes are easy to analyse before code runs. Stacks records its blocks on Bitcoin, so its settled history is hard to change unless Bitcoin’s is.
3. The Nakamoto upgrade and sBTC
The Nakamoto upgrade in October 2024 let Stacks blocks arrive every few seconds instead of waiting for Bitcoin’s roughly ten-minute blocks, and gave transactions Bitcoin-level finality. In December 2024 sBTC, BTC deposited one-for-one for use on Stacks, opened for deposits, and withdrawals back to BTC followed in April 2025.
Stacks hosts lending and trading apps using sBTC and STX, NFTs and the Bitcoin Name System (BNS), with sBTC meant as core collateral. It targets people who want to use bitcoin in DeFi without selling it, and it is one of the oldest projects in the so-called Bitcoin L2 race.
4. Things to know
Whether Stacks counts as a true Bitcoin L2 is debated, because it has its own coin and its own validation, and Bitcoin itself does not verify Stacks transactions. The BTC that miners bid varies with STX’s price and rewards, so stacking returns are not fixed.
sBTC relies on a group of signers who hold the BTC, so how spread out that group is, and how it changes, matters. The legal status of STX, first sold under securities rules in 2019, and shifts in mining economics as Bitcoin fees change are also worth knowing.
Written from information public up to October 2026. It does not recommend or rate any coin and is not investment advice. If something is wrong, please tell us through the contact page.