“When everyone zigs, Stacks zags.”
— Nick Grossman, USV

The popular opinion in crypto is that proof-of-stake is the future. Stacks recycles Bitcoin’s PoW and avoids PoS.

Why do we prefer PoW? Tweet thread👇
1/ First of all, intelligent people I respect, e.g., Silvio Micali (Algorand), are working on proof-of-stake, so clearly, I think it’s a design space worth exploring.

Given that enough smart people are already exploring PoS, I’m more interested in researching other designs.
2/ I don’t like slashing conditions in PoS. An event like a network partition (however rare that might be) can slash funds of honest nodes.

That’s why in Stacks, we had a design requirement not to have any slashing conditions.
3/ In PoW, it’s hard for an attacker to produce many different blockchain histories (every history has energy cost).

I don’t like the attack surface where PoS chain histories are cheap to produce.
4/ Probabilistic finality typically used with PoW means that a blockchain can route around failures. Instant finality has benefits but also opens up potential halting scenarios.

Stacks follows probabilistic finality similar to Nakamoto consensus, i.e., deep reorgs are allowed.
5/ Independent verification is critical for blockchains. With PoW, anyone can run a node and independently decide on the correct fork, i.e., the fork with the most amount of energy spent. 

Trusted channels are needed for new PoS nodes to agree on the correct fork.
6/ PoS systems are actively researched and already scaling in production.

Alternatives to PoS are, however, under-explored; added reason for our recycling Bitcoin’s PoW work.

Avoiding herd mentality is beneficial for our industry. We’re not building yet another PoS system.
P.S: For energy consumption, this is green like PoS, but it’s not PoS.

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More from @muneeb

26 Jul
Native Bitcoin swaps are now live!

Why is this a big deal? Tweet thread👇
1/ What is this?

Users can do trustless BTC swaps to stablecoins, derivatives, perpetuals, and other crypto assets.

All by pure Bitcoin transactions on the main BTC chain.

Users can purchase any digital assets (like NFTs and decentralized domains).
2/ This is a big f—king deal. Why?

Bitcoin has established itself as digital gold, but you can’t use BTC to trade without going through:

(a) centralized exchanges, or
(b) alt blockchains w/ wrapped BTC

Not anymore!
Read 8 tweets
30 Jun
Coindesk reported that USDC is planning to expand to Stacks.

This is a narrative violation that DeFi is not possible in the Bitcoin ecosystem.

So what are the benefits of USDC on Stacks? Thread👇
1/ USDC transactions would benefit from the security of Bitcoin.

USDC transactions on Stacks automatically settle on Bitcoin. To rewrite the history of these transactions, you’d need to rewrite the history of Bitcoin.
2/ Availability of USDC would open doors for USDC/BTC atomic swaps, i.e., with BTC on the main Bitcoin chain.

(@fmdroid already has a prototype of STX/BTC atomic swaps.)
Read 7 tweets
28 Jun
Back on Twitter after a week of disconnecting from it 👋

It looks like @AriDavidPaul is giving $1M in cash to someone who can implement CryptoKitties on Bitcoin.

Here is how to build that👇
1/ The straightforward way to do this would be to use SIP-009 that defines NFTs on Stacks. However, you’d be paying gas fees in Stacks (not Bitcoin).

Apps like boom.money already do this.

Link: github.com/stacksgov/sips…
2/ One can argue that these NFTs “settle on Bitcoin” but are not “on” BTC.

Fair enough.

Stacks recognizes pure Bitcoin transactions for transfers/ownership, i.e., pay a gas fee in BTC.

How to use that in CryptoKitties?
Read 6 tweets
25 May
On the origin of NFTs.

How and when did NFTs start? How are they evolving? Tweet thread👇
1/ Non-Fungible Tokens (NFTs) are crypto assets that are one of a kind.

The value of one unit of cash or Bitcoin is the same as another. NFTs are the opposite of that and are unique.

It might seem like NFTs are a recent thing--they're not. NFTs have been around for a decade.
2/ Decentralized domains were the original crypto NFTs.

A decentralized domain is unique, i.e., non-fungible. Namecoin pioneered decentralized domains in 2011, launching at Bitcoin block 19,200 with merged mining.

(I registered u/muneeb there in Feb 2014.)
Read 8 tweets
18 May
Bitcoin is often misunderstood within the crypto industry. Here is how:

Tweet thread👇
1/ People don’t think beyond the Bitcoin base layer.

L2s in Ethereum or subnets in Avalanche bring additional features to base layers. 

Similarly, Bitcoin layers, like Lightning for payments or RSK/Stacks for smart contracts, bring additional functionality to Bitcoin.
2/ Bitcoin is for settlements, not payments.

The additional layers, like Lightning or Stacks, is where payments happen. On Lightning, people use sats, and on Stacks, people can use stablecoins like xUSD or Bitcoin-based assets like xBTC.
Read 7 tweets
6 May
How does the recent interest in Ethereum impact the crypto industry?

Tweet thread👇
1/ Bitcoin found product-market fit as digital gold (store of value) with no real competition in that category for years.

Ethereum's upcoming change in token economics with reduced supply has increased interest in the asset.
2/ Ethereum aims to be both (a) gas for smart contracts and (b) "ultra sound" money, i.e., compete with Bitcoin as a store of value.

Challenging Bitcoin's position as a store of value and the #1 crypto asset will undoubtedly result in tribal arguments.
Read 12 tweets

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