On Bitcoin rollups and the Stacks layer: Rollups are an exciting development for scaling decentralized apps. On chains with full execution like Ethereum, the validity of rollups can be determined by the underlying L1.

Recent ‘sovereign rollups' only rely on underlying L1 for data availability (DA) and not consensus.

A mega thread on Stacks, a Bitcoin L2. 

What is Stacks L2? Details and links👇 1/ Stacks is an open-source project started by a bunch of Bitcoin builders. The devs behind it have extensive experience in building apps & protocols on Bitcoin L1.

In 2017, after the block size wars, it was abundantly clear that the only way to scale transactions or new use… twitter.com/i/web/status/1…

NEW: we’re releasing two papers that enable trustless movement of BTC in/out of Bitcoin layers; unlocking the full potential of Bitcoin in DeFi & web apps.

A trustless two-way Bitcoin peg has been a holy grail problem for a decade.

More details👇 The papers are by 3 working groups (with some anonymous contributors!) and have no listed authors.

First paper proposes sBTC a trustless two-way Bitcoin peg. Think WBTC (Ethereum) or L-BTC (Liquid) but no custodian or federation!

Read the sBTC paper: stacks.co/sbtc.pdf

There are discussions in the Bitcoin community that “Ethereum is a security.” This theory is flawed; I say this as a Bitcoiner who holds no ETH.

People who believe this have likely not studied the state of the Ethereum network from a Howey Test lens. 1/ Ethereum may not be as decentralized as Bitcoin, but on the spectrum it is on the decentralized side vs. being run by a company.

You can shut down entities like the Ethereum Foundation or ConsenSys and the Ethereum network will continue to operate and function.

Early thoughts on the web5 initiative by @jack and the TBD team.

You might think that it's “Ethereum on Bitcoin,” it’s not. In fact, there are no smart contracts at all and no new blockchains/sidechains. So what is it? The web5 initiative has roots in the decentralized identifiers (DID) ideas that date back to the mid 2010s or earlier. I worked on similar ideas in 2015-2016 and learned several lessons.

(Anyone interested should search IIW archives for community discussions.)

Major news: we’ve raised $150M for a new entity to build the largest ecosystem of Bitcoin applications.

Bitcoin can be a productive asset and final settlement layer for web3 apps.

Say hello to Trust Machines: trustmachines.co/blog/hello-tru… 1/ I’m doubling down on Bitcoin and Stacks.

Recent success of Stacks has shown how powerful smart contracts for Bitcoin can be. There is a tremendous opportunity to use BTC as a trillion dollar productive asset and grow the Bitcoin economy. We’ve barely scratched the surface.

Bitcoin folks can have two reactions to BTC vs. ETH gas fees comparison:

a) Keep denying that ETH is gaining more users and developers, OR

b) Grow the Bitcoin apps economy.

I’m in camp (b) with @Stacks. Gas fee is a measure of how valuable block space is. I believe that Bitcoin is the best settlement layer and, therefore, will be the most valuable block space.

However, currently, the economy of apps using Bitcoin for final settlement is relatively small right now.

Stacks turns one year old today!

With my party hat on, let’s reflect on the year. Tweet thread👇 1/ The Stacks whitepaper came out in 2017 outlining design for Bitcoin apps.

It typically takes 2-3 years to build new blockchains. Projects that raised in the 2017 era (Filecoin, Dfinity, Stacks, etc.) went heads down and launched their mainnets in 2020-2021.

I'm a Bitcoin Centrist.

Bitcoiners don't like labels, but we need a term differentiating from Bitcoin maximalists. Call it progressives, centrists, moderates, or simply Bitcoiners, but we need to distinguish ourselves from the loud maximalists. 🧵 1/ Bitcoin will attract people with different beliefs and views, and we shouldn't expect all Bitcoiners to think alike. It is, however, essential to realize that maximalists are a loud minority.

Let's look at some ways maximalists differ from centrists like me.

Bitcoin maxi paradoxes:

- Love decentralization yet use centralized exchanges (no DEX for BTC).

- Love free markets yet hate venture capitalists (free market actors).

- Love open-source yet hate an entire revolution of new open-source apps. - Love freedom to do what you want but don’t work on non-Bitcoin things please.

- Love freedom of speech but will censor devs from Bitcoin podcasts.

- Love Bitcoin as best money but only hold as passive asset please.

- Love truth-seeking but create thought bubbles to live in.

The people will own web3.

VCs have reduced power and ownership in crypto protocols. Tweet thread👇 1/ Founders, VCs, and employees primarily owned web2 companies. The general public couldn’t participate in any economic upside for the first 10+ years.

Bitcoin maximalism is limiting the growth of Bitcoin.

Retweet for visibility if you agree.

Tweet thread👇 1/ Bitcoin maximalism as a strategy for growing Bitcoin is failing.

The maximalist narrative has lost touch with reality. I say this as a Bitcoiner who started in 2013. I’ve held BTC through multiple bear markets & spent years building apps & protocols on Bitcoin.

The bullish case for Bitcoin: beyond sound money.

Tweet thread👇 1/ Bitcoin found product-market fit as decentralized sound money.

People are already using it as an inflation hedge.

Estimates for future Bitcoin value range from $10 trillion (gold market cap) to $100+ trillion (subset of global wealth).

Bitcoin NFTs represent Bitcoin culture.

This is a powerful emerging trend.

Tweet thread👇 1/ Humans are social animals. We thrive in communities.

Every community has its own culture represented in stories, art, symbols, and values.

I've been politely responding to criticism from @adam3us @notgrubles for weeks.

It's time to set the record straight RE Liquid vs. Stacks.

Please retweet to help educate people.

Tweet thread👇 1/ First of all, I highly respect the contributions of Adam Back and Grubles. We can disagree on some topics, but that does not take away my respect for them.

Let's dive into their criticism of Stacks and how it compares to the work they prefer: Liquid.

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.

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.)

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.

“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.

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).

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.