muneeb.btc Profile picture
19 Aug, 10 tweets, 2 min read
The opportunity window for starting new layer-1 blockchains was in 2017-2018.

Some thoughts on the L1 landscape👇
1/ First, let’s separate Bitcoin (sound money) from smart contract platforms.

New money layers (e.g., Bitcoin forks) have failed miserably.

Bitcoin is the clear winner for sovereign money (with recent attempts from Ethereum to compete there.)
2/ Smart contract platforms, however, remain a rapidly growing and competitive market.

The opportunity window for starting new L1 blockchains for smart contracts was in 2017-2018. These platforms typically require 2-3 years of development before mainnet launch.
3/ If you want to start a new L1 in 2021, you’ll likely find it hard to raise capital. A new smart contract L1 coming online in 2024 will likely be too late to the game.

The one exception here is privacy-focused chains, which are still new and can attract capital.
4/ Putting aside any shortcomings of Ethereum’s design, it deserves credit for pioneering smart contracts and is the clear leader in developer adoption.

Ethereum will likely remain a big player for years. However, theories around “ETH killers” are broken in several ways.
5/ The “ETH killers won’t get traction” theory is already dead. Developers are actively building, and L1s are growing.

The “one network to rule them all” theory needs 10+ years to play out. Currently, signs point to a multi-chain world with some consolidation 5-10 years out.
6/ There is some competition between newer L1s like Solana, Algorand, Avalanche, Stacks, etc., but they’re primarily focusing on a rapidly growing market instead of trying to “kill Ethereum.”

There are only 6-7 high-quality L1s. New ones are not entering this market.
7/ L1s can find their specialized markets and grow there. 

Stacks, for example, exclusively focuses on Bitcoin and to make BTC programmable and productive. Solana’s architecture might be well-suited for NYSE-type trading.

Consolidation is likely years out and may never happen.
8/ In summary, if you had the foresight to start an L1 smart contract platform in 2017-2018, congratulations! You picked a great market.

The tribal nature of crypto means that a lot of loud voices will doubt your work. You can safely ignore them and focus on building the future.
P.S: These views are from someone who raised capital in 2017 and 2019 to build an L1 for smart contracts, so take them with a grain of salt 🙂

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More from @muneeb

24 Aug
Decentralized lottery game on Bitcoin.

How can this work? Tweet thread👇
1/ Satoshi Dice showed in 2012 how popular Bitcoin-based betting games could get.

Now with smart contracts for Bitcoin, developers can build much more sophisticated games. Let’s walk through a Powerball-like game.
2/ First, I’m not a lawyer, and any developer building such lottery games should consider appropriate laws in local jurisdictions. 

I’m interested in the technical design and possibilities.

Putting the legal disclaimer aside, let’s dive in!
Read 8 tweets
2 Aug
City governments can embrace Bitcoin and crypto faster than nations.

Miami Mayor @FrancisSuarez is experimenting with crypto to give Miami a Bitcoin-yielding treasury.

A thread on cities and crypto👇
1/ There are at least two ways city governments can embrace crypto: 

(a) cities can put Bitcoin on their balance sheet, and

(b) they can issue a "governance token" to engage their citizens.
2/ Cities like NYC run on billions of dollars. Like public companies, city governments can also diversify their cash balances into Bitcoin.

@michael_saylor wrote the book for Bitcoin corporate treasuries; forward-looking mayors like Suarez might write a similar book for cities.
Read 9 tweets
30 Jul
“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.
Read 8 tweets
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 already do this.

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

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