Stacks’ native STX token has soared more than 24% in the last 24 hours after billionaire venture capitalist and crypto advocate Tim Draper praised the layer 2 network’s potential in an online interview. STX rose close to 30% earlier in the day.
“Well, I’m really pretty excited about Stacks,” Draper told Jessica Walker and Raoul Pal, co-hosts of Coin Bureau’s popular YouTube channel.
The significance of Stacks – which enables smart contracts on the Bitcoin network – has risen in recent months amid heightened demand for non-fungible and BRC-20 tokens allowed through the advent of the Bitcoin Ordinals protocol.
Draper has invested heavily in crypto projects and has been known for making grand predictions about the price of BTC, most recently, that BTC would reach $250,000 by 2024. In his interview Tuesday, he noted the shift in crypto development toward Bitcoin.
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“When bitcoin was at $40,000 the last time, Ethereum was at $3,000. Now Bitcoin’s at $40,000 and Ethereum’s at $2,000,” Draper said. “And all the way down, the rest of the tokens are also smaller relative, most of them, to Bitcoin. There is this slow steady movement toward all the important applications going on Bitcoin.”
Draper added, “Most of what I’ve been investing in have been things that start to move the important applications over to Bitcoin. That’s a really interesting trend.”
Draper’s comments about the Bitcoin layer 2 occurred on the same day Messari highlighted Stacks among its top 10 decentralized finance (DeFi) trends. “Bitcoin has seen a vibrant L2 (sidechain) ecosystem emerge this year, led by Stacks, which can read and respond to bitcoin L1 transactions,” crypto research group Messari wrote.
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STX, the Stacks layer’s native token, plays a pivotal role in the protocol’s consensus mechanism. STX incentivizes miners to maintain consensus for the Stacks ledger, according to a whitepaper, “STX was distributed to the public through the first-ever SEC-qualified token offering in US history.”
DeFi is a crypto sub-ecosystem that enables financial transactions designed without the need for centralized intermediaries. Total value locked on Stacks at the start of the year stood at $6.8 million and has since risen about 650% to more than $51 million, data from DefiLlama shows.
The native token of the Stacks network was recently changing hands at $1.46, according to CoinGecko, a more than fivefold increase from the start of the year.
Ordinals enables users to inscribe data onto Bitcoin’s smallest unit known as satoshis or “sats.” Market data provider OrdinalHub indicates that Bitcoin Ordinals has generated more than 922 BTC or about $40 million in total volume over the past 24 hours, according to its website.
