Key Points
- Stacks [STX] is undergoing the Nakamoto upgrade, potentially driving higher Bitcoin transaction fees.
- Despite competition, Stacks is among the top three based on Total Value Locked (TVL).
Stacks, a significant player in the Bitcoin L2 space, is activating the Nakamoto upgrade.
This two-step overhaul, which began on 22 April, could potentially drive higher Bitcoin transaction fees.
Bitcoin L2 Space and Nakamoto Upgrade
The Bitcoin L2 space has been gaining attention.
Analysts from Bernstein noted that Bitcoin is experiencing a ‘Defi summer’ moment, similar to Ethereum in 2020.
Despite being over three years old, Stacks has had issues with speed.
The Nakamoto upgrade aims to improve this speed and facilitate the movement of BTC from L1 to L2.
Impact on Stacks [STX]
Stacks [STX] saw a rise of over 36% on the weekly charts and rallied 8% on Monday, just before the first phase of the Nakamoto upgrade went live.
The second and final phase of the Nakamoto upgrade is set to occur in late May, potentially bringing new capabilities to programmable Bitcoin.
Some market watchers believe that the upgrade has not been fully priced into STX and BTC.
However, Stacks faces competition from new L2, Merlin Chain, and Rootstock, which are currently leading in terms of Total Value Locked (TVL).
Despite this, Stacks remains among the top three based on TVL.
As the BTC L2 space heats up, it remains to be seen whether the Nakamoto upgrade will give Stacks an advantage over its competitors.
