Today in Markets

The Ordinals Renaissance

Stacks (STX) is on the rise as Bitcoin's Ordinals Renaissance fuels demand

Dec 18, 2023 • 1 min read

STX's time to shine? Amid an Ordinals Renaissance on Bitcoin, transaction fees have surged to cycle highs and the mempool has gotten heavily congested. Users are getting pushed out towards Bitcoin’s L2s, and the Stacks network is a clear beneficiary of this trend, with STX up 14% on the day.

Much like an Ethereum L2, Stacks users enjoy lower transaction fees and higher throughput than users on the Bitcoin L1. Additionally, Stacks provides smart contract programmability not native to Bitcoin.

While Stacks is certainly not immune to transaction spam spawned by the Ordinals Renaissance, the chain has been able to handle the load resulting from STX20 inscription minting and remains uncongested at most times, in stark contrast to the Bitcoin L1 scene.

.@Stacks humming along as the definitive smart contract platform for #Bitcoin

Stacks contained 10,371 transactions in block 132,377, the most transactions ever in a block on Stacks, driven by STX20 inscription minting.$STX https://t.co/G35brnbMmx
— ◢ J◎e McCann 🧊 (@joemccann) December 18, 2023

Stacks will never replace Bitcoin, but the close technical proximity between the two networks could make STX a potential high-beta play on BTC as the deadline for spot ETF approval looms ever closer, another potential catalyzing factor that could be driving demand for the STX token.

Increasing adoption of Bitcoin, both the network and the asset, bodes well for STX holders, as the former will naturally drive users to Stacks and the latter will concentrate narrative fervor on the network.

Not financial or tax advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This newsletter is not tax advice. Talk to your accountant. Do your own research.

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