In an era when Bitcoin has redefined the way we think about finance, Muneeb, the co-creator of Stacks, a Bitcoin Layer 2 (L2) protocol, and CEO of Trust Machines, lays down an argument that challenges us to reimagine Bitcoin’s potential. According to Muneeb, ‘The single most important thing needed for the growth of Bitcoin is the emergence of high-quality Bitcoin L2s.’ But what does this actually mean for Bitcoin and its burgeoning user base?
Muneeb advocates for L2s that can execute fast, cheap BTC transfers at high volumes, asserting, ‘I should be able to send $100M in BTC over an L2 without thinking about the infrastructure.’ And he doesn’t stop there. These L2s, according to him, should have ‘full execution environments,’ similar to the Ethereum Virtual Machine (EVM) or Solana VM. By doing so, he believes, we can attract more developers to the Bitcoin ecosystem, which in turn will enrich the types of applications that can be built on top of Bitcoin.
Yet, Muneeb’s argument doesn’t merely hinge on the technical capabilities of L2s. He strongly believes that Bitcoin L2s will be the primary way people interact with BTC in the future. ‘There is no way we can support a billion people using BTC at the Layer 1 (L1),’ he argues. His solution? Embrace every Layer 2 experiment, from federated ones to peer-to-peer solutions and even bridges to other sovereign Layer 1 protocols. ‘Let the devs build and let the markets decide what solutions end up getting used,’ says Muneeb.
Measuring the success of these Layer 2 experiments isn’t just pie-in-the-sky thinking for Muneeb. He sets forth concrete metrics: ‘In the end the winning Bitcoin L2 will be the one that moves the most amount of BTC from L1 to L2.’ The secondary metric? The number of active users engaging with BTC on the L2.
Muneeb acknowledges the current state of Bitcoin L2s is nascent, with none holding more than 10,000 BTC or having millions of active addresses. In contrast, Coinbase, a centralized company, controls approximately 5% of BTC’s supply, valued at over $25 billion. Muneeb’s vision for the future is nothing short of ambitious: ‘I cannot wait for the first Bitcoin L2 to reach $10B in BTC circulation and eventually flip Coinbase in usage.’
So, how does Stacks fit into this picture? According to Muneeb, the upcoming Nakamoto release of Stacks will bolster its status as a Bitcoin L2. ‘Stacks will have 100% Bitcoin finality or reorg resistance… BTC deposit/withdrawals become a core part of consensus, and fast L2 blocks that auto-settle when Bitcoin blocks come,’ he explains.
In a nutshell, Muneeb believes we are on the cusp of a paradigm shift that could make Bitcoin not just a digital gold but also the ‘dominant internet money.’ And the key to this revolution? High-quality Bitcoin Layer 2s. It’s a call not just for innovation, but a demand for a new kind of freedom in the digital realm. ‘Time to build,’ as Muneeb succinctly puts it, indeed.”
