- Blockstack released their whitepaper on a new consensus mechanism, Proof of Transfer (PoX) on Bitcoin blockchain.
- Muneeb Ali said Blockstack chose Bitcoin, given the potential it holds over other blockchains.
- Will PoX consensus mechanism survive on Proof of Stake (PoS) coins?
Blockstack, a blockchain-based solutions company, released its whitepaper on a new consensus mechanism, the Proof of Transfer (PoX). The consensus mechanism is set to integrate the Blockstack onto blockchain allowing users to gain returns by “stacking” their Bitcoin (BTC) and gaining Stacks (STX) token.
According to Muneeb Ali, the CEO and Founder of the Blockstack, the new consensus mechanism will boost the adoption of the Stacks platform as the system becomes more dependent on Bitcoin’s growth prospects. BTC is the largest and most prosperous cryptocurrency in value and security offering a stable blockchain for dApps and other layered platforms. He said,
“We are saying that Bitcoin is already so dominant and so secure that it's entirely possible that Web 3.0 emerges on top of Bitcoin.”
And how does Blockstack’s PoX consensus mechanism come into play?
Bitcoin uses the proof of work (PoW) consensus mechanism – whereby miners are rewarded with BTC for using their electricity and computing power to secure the blockchain. Blockstack, which is built on Bitcoin, then does not need to use the same energy and scares resources to secure its own platform hence the adoption of a proof-of-transfer (PoX) mechanism.
Miners on the Blockstack platform will be able to commit BTC to verify transactions and in return gain STX tokens. The BTC that is collected is then distributed across the network – “stackers” or the full node runners gaining a portion of the coins and the rest sent to the development fund.
Will PoX move to proof of stake mechanisms?
At the moment, the PoX consensus mechanism is targeting only PoW chains with no plans to move to the ever-growing proof of stake (PoS) consensus mechanism. For miners to gain the best returns, the price of STX should follow the growing price of BTC (according to Ali), and if the price of BTC collapses, Blockstack’s PoX consensus system will move to a different chain.
However, Ali does believe in the future prospects of Bitcoin as every new entrant in crypto (whether a user or project) deals with the coin. He concluded saying,
“Bitcoin is a reserve currency. Everyone has it. Everyone's using it.”
Muneeb Ali said Blockstack chose Bitcoin, given the potential it holds over other […]