podcasts

Bitcoin Smart Contracts, with Muneeb Ali of Stacks

podcasts

Bitcoin Smart Contracts, with Muneeb Ali of Stacks

Muneeb Ali, the Co-Founder of Stacks, returns to the Metaverse Podcast for a second time. Stacks is an open-source network of decentralized apps and smart contracts built on Bitcoin. In this episode, he shares with host Jamie Burke the updates that the protocol has undergone and their plans for the future.

Posted by Bitcoin Smart Contracts, with Muneeb Ali of Stacks - May 2022

Background

Bitcoin Smart Contracts, with Muneeb Ali of Stacks Outlier Ventures

  • Muneeb is the founder of Stacks (formerly Blockstack)
  • Stacks enables smart contracts on Bitcoin
  • This is Muneeb’s second time on the Metaverse Podcast

Differences Between Stacks And Hiro System

Bitcoin Smart Contracts, with Muneeb Ali of Stacks Outlier Ventures

  • Stacks is a decentralized open source project
  • Have ~50 independent entities working in the system
  • Hiro System is a dev tooling system

Why Does He Want To Bring Smart Contracts To Bitcoin?

  • Bitcoin is winning the sound money, inflation hedge category
  • Currently, Bitcoin’s market cap is around a trillion
  • In the future, it will be worth multiple trillions
  • People would want to deploy that capital instead of letting it sit passively

It’s [Bitcoin] not going to remain a passive store of value, which right now, it is largely a passive store of value. Even if you’re a public company, you might have Bitcoin on your balance sheet, but you aren’t really doing anything about that Bitcoin. It’s just kind of like sitting there.

– Muneeb Ali

  • Ethereum and other smart contract platforms are enabling productive capital
  • The Ethereum community realized that to be successful over decades, blockchains have to eventually become money
  • Vitalik recently wrote a blog post detailing the last 5 years of Ethereum. In it, Vitalik ponders whether Ethereum should be more simple or more complex and experimental
  • Their approach is to let Bitcoin remain simple and as money while they bring smart contract functionality to it
  • Wrapping Bitcoin and issuing it on Ethereum introduces a central point of failure

What happens when 10% of Bitcoin needs to be wrapped? At some point like there’s just too much capital that is sitting at a single custodial entity for it to be practical in DeFi right?

– Muneeb Ali

Response From The Bitcoin Community

  • Have been part of the Bitcoin community since 2013
  • Between 2013 and 2016, the Bitcoin community was a lot more open to new things being built on Bitcoin
  • Examples of things built on Bitcoin pre-2017:
    • Omni Protocol — stablecoin/Tether issuance
    • Counterparty — NFTs on Bitcoin (e.g. Rare Pepe)
  • In 2017, the Bitcoin community split over various Bitcoin forks and the threat of Ethereum that has just emerged

The reaction it was almost like a defense mechanism that the Bitcoin community had was a little bit like look, don’t change Bitcoin, we don’t want any changes to the base layer because just being money is enough. And at the same time, all these other use cases they’re kind of stupid, right?

– Muneeb Ali

  • Bitcoin is an open network. Anyone can come in to develop on top of it
  • A lot of the Bitcoin OGs are open to building on Bitcoin and enhancing the network in layers
  • He has to educate both the Bitcoin community and those that are outside it

How Does He Cut Through All The Noise?

  • The average Bitcoin owner owns Bitcoin and other assets
  • As the Bitcoin community grows, the voice of the maxi population gets diluted down
  • Some Bitcoin maxis hold other assets but they do not admit it publicly since they have already painted themselves in a corner

Lightning Network And Stacks

  • Lightning is a complementary technology
  • Lightning enables off-chain payment that settles on Bitcoin
  • Stacks is a separate programming layer with its own ledger. A separate ledger is required to build smart contracts
  • Each transaction on Stacks automatically settles on Bitcoin
  • Users can do a normal Bitcoin transaction that interacts with the smart contracts running on Stacks
  • Zest, a Bitcoin lending application, is coming online soon. This provides an alternative to centralized parties like BlockFi
  • Lightning swaps to Stacks are already live
  • Because of their work, users can just open up their Cash App or Robinhood app and purchase an NFT using a stablecoin

How Is Stacks Perceived By High Profile Individuals Such As Jack Dorsey?

  • Doesn’t know about Dorsey’s personal views
  • Thinks that it lies on a spectrum
  • There are some Bitcoiners who do not know that Stacks exists

Their Reach

  • Their team have a heavy engineering focus
  • He’s trying to have a public profile and to get better at simplifying concepts
  • Historically, their team did not do as good a job on the marketing and project awareness front
  • Got Aubrey Strobel to join them recently
  • Need to level up on their comms and marketing

Things Being Built At Stacks Conferences

  • The growth is organic. They did not hand out money to incentivize people to build
  • The programming language they invented is called Clarity
  • Clarity has attracted engineers to take a deep dive into the language

Roadmap For The Next 12-18 Months

  • Various entities with fresh capital have entered the ecosystem
  • These entities have raised between $500k to $10 million organically without any incentivization
  • Excited about Hyperchains — Solana-like speed in the Bitcoin ecosystem

Bitcoin Smart Contracts, with Muneeb Ali of Stacks Outlier Ventures

This podcast summary was prepared by The Reading Ape in collaboration with Outlier Ventures. The Reading Ape is a humble servant of the written word.

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