STX, the native token of the Bitcoin-focused Stacks layer 2 smart contract platform, is up about 30% over the past seven days, driven by Bitcoin’s recovery.
STX/USD daily chart. source: TradingView
STX (STX) trading volume doubled over the same period to $148.2 million on September 26, surpassing Bitcoin (BTC)’s 7.5% increase since September 18.
Let’s look at the factors contributing to STX’s upward momentum.
STX price rebounds as Nakamoto upgrade approaches.
The STX price rise comes as the community prepares for the upcoming update, known as the Nakamoto release, which is less than 15 days away.
The Stacks Foundation has officially announced that the highly anticipated Nakamoto upgrade will be activated on October 9th. Core developers chose Bitcoin block number 864864 as the hard fork block.
Stack Nakamoto release countdown hard fork. Source: Stack
The upgrade is expected to improve Bitcoin’s decentralized finance (DeFi) by increasing transaction speeds and introducing a new Bitcoin pegged token, sBTC. SBTC will be used by Bitcoin holders who want to participate in smart contracts and developers who want to build applications on Bitcoin.
To celebrate this important milestone, the Stacks community will host more than 20 developer workshops around the world featuring lectures, live demonstrations, and technical challenges where participants can earn STX tokens.
In preparation for this, Solana and Aptos announced the integration of sBTC, a Bitcoin-based asset. This will allow developers to integrate sBTC into decentralized applications (DApps) on these platforms.
Source: Stax Foundation
This integration provides Bitcoin holders with more opportunities to use their assets beyond simple holding or trading, such as participating in decentralized finance or participating in NFT marketplaces.
STX price rises due to network growth
All of these developments have increased user interest in the stack, with smart contract deployments on blockchains reaching an all-time high. In a September 7
Number of smart contracts deployed to the stack each month. source: Stax Foundation
Additional data compiled by DeFi analytics firm DefiLlama shows that DEX trading volume on the Stacks Network has increased dramatically, increasing by more than 31,300%, from $100 on September 17 to $31,480 on September 25.
DEX trading volume. Source: DefiLlama
Another metric used to measure user interest and trust in a blockchain network is the Total Value Locked on the Platform (TVL). According to data from DefiLlama, Stacks’ TVL has increased 70% from $91.1 million on September 18 to $112.5 at the time of this writing.
Total value locked in the stack. Source: DefiLlama
The increase in total value locked in the stack signals a significant influx of capital into the network’s DeFi ecosystem, highlighting investor confidence and active participation in DApps.
relevant: ‘Continued’ Bitcoin ETF inflows could push price ‘up’ despite slowing spot buying
Bitcoin price upward trend leads STX upward trend
The approval of a US-based spot Bitcoin ETF and the expected Bitcoin halving in the first quarter of 2024 pushed the price of BTC to an all-time high of $73,835 on March 14. Likewise, STX hit an all-time high of $3.84 in April. 1.
Due to the recent 50bp interest rate cut by the U.S. Federal Reserve (Fed) and increased Bitcoin ETF inflows, the price of BTC showed a strong rebound, rising to $65,800 on September 26. STX also followed Bitcoin again. On September 26, it rose to an eight-week high of $2.07.
STX/USD vs BTC/USD daily chart. source: TradingView
With market participants expecting the Bitcoin price to continue to rise in the fourth quarter of 2024 and Layer 2 Bitcoin development gaining attention, Stacks will further establish itself as a dominant player in the Layer 2 Bitcoin sector. You can.
This article does not contain investment advice or recommendations. All investment and trading activities involve risk and readers should conduct their own research when making any decisions.