2024-04-16 07:19:22

Stacks Defi Ecosystem – Best STX DeFi Apps & Tools (With Commentory)

App/Protocol	Utility	Notes
Xverse wallet	Best Wallet for STX	Easy to use & offers native staking with yield in BTC
KuCoin, Bybit	Crypto exchange to buy STX token	Option to withdraw natively on Stacks blockchain
StackingDao	STX Liquid Staking	First Liquid Staking platform for STX
Lisalab	STX Liquid Staking	Offers LST token & is offered by an established brand of STX ecosystem
Alexlab	DEX, Launchpad, and more	–
Arkadiko	Mint stablecoin with Liquid Staked token	I don’t like this idea as this will eventually create a bubble.
Stackspulse	Real-time on-chain Stats for Stacks DeFi.	Useful to discover growing DAPPS on Stacks
STXTools	Birdeye of Stacks Ecosystem	For Traders and Investors
Stacks Ecosystem Twitter list	Twitter list to follow Stacks-related updates	A list managed by Your’s truly, Mr. Creatonics

Extending my series on Bitcoin Layer 2 solutions, today we are going to be looking at Stacks blockchain DeFi apps. Stacks is a leading Layer 2 blockchain solution for Bitcoin, and a ton of new DeFi apps are being launched on this blockchain. Stacks has a token called STX, and currently, it is trading at a rate of $2.51 on multiple major exchanges.

As these DeFi apps on Stacks (STX) grow in popularity, STX should see significant demand. Other Bitcoin Layer 2 solutions are being worked upon, but nothing has come up as close to what Stacks has achieved. It is good to be early in any industry, but at the same time, it is more important to be cautious and open-minded about new innovation and product-market fit.

These Layer 2 solutions will help in Bitcoin adoption; otherwise, Bitcoin might majorly become a store of value. For the medium of exchange, stablecoins are more popular, and all the DeFi action is happening on Ethereum and ETH Layer 2 solutions, or in the Solana ecosystem.

So, in a nutshell, Stacks and other Layer 2 solutions for Bitcoin will pave the way for more usage of the Bitcoin blockchain.

Here is an excerpt from Aaron.D article about Stacks:

There are a few well-known scaling projects dedicated to helping Bitcoin scale. Lightning, RSK, Liquid BTC, and Stacks stand out among these projects. Lightning is in its own league as engineers designed it to bring much cheaper transactions to Bitcoin. Meanwhile, RSK, Stacks, and Liquid BTC bring additional functionality to Bitcoin, like smart contracts, tokens, and asset issuance.

Anyways, think of this guide as your beginner guide to make most out of Stacks ecosystem. Use this as a basis of research, and If the response is good, I will do a deep dive on STX and Stacks in the future articles.

Best STX Wallet: (Stacks Wallet)

Xverse Wallet – Leading wallet for Bitcoin Web3

This is by far one of the best wallets that you can use to interact with Stacks DeFi apps. Xverse is the leading wallet for Bitcoin Web3, enabling users to connect to apps, safely store and send Ordinals and BRC20 tokens, earn BTC rewards with Stacks, and soon enjoy instant payments with the Lightning network.

One least talked-about but most important feature of the Xverse wallet is that you can stake STX from the wallet and earn rewards in BTC. This is what makes STX very interesting, and if Bitcoin truly becomes a distant dream for many to acquire, STX might be used as a way for a lot of users to accumulate BTC.

Xverse is available on all major platform such as iOS, Android and also as a chrome app.

>>>> Download STX Wallet <<<<

Xverse also works with Ledger on desktop, and here is a guide for the same. I have not tested it, and rather created a new wallet to use the STX ecosystem.

If you are looking for other wallets, here are three other wallets that are supported by majority of Stacks DeFi apps. I personally like Xverse because they have been the north star in the growth of Stacks ecosystem.

Leather wallet: https://leather.io
Asian wallet: Multisig wallet for Stacks and Bitcoin. https://asigna.io
OKX Wallet

The list of new wallet is continue to grow, and I would suggest to stick with established wallet like Xverse or Leather or even OKX wallet. As per the official site, these are some more wallets.

How to get STX (Buy STX) –

Before you start using any of the Stacks DeFi apps below, you need to buy STX and withdraw it to your Stacks wallet. The block time for Stacks is 5 seconds after Nakamoto upgrade.

STX is available on all major crypto exchanges, and you can buy STX from any of these exchanges.

Where to buy STX token:

KuCoin
Binance
Phemex
Bybit

After that, withdraw STX to your wallet so that you can start the DeFi action on Stacks ecosystem.

Alright, so I assume you already have STX on your wallet, and now you are ready to do a lot of things from here.

Note: None of these is an investment advice, and should be use as an educational content. Feel free to use this as a basis of your research and build your knowledge.

Now, there are going to be primarily three types of users:

Traders – You are better off keeping your STX on your crypto exchange and trading when and as you like.
Long-term investors – You can withdraw STX to your Xverse wallet and stake it on a liquid staking platform or even directly stake using the Xverse wallet (More on this later).
Crypto OG’s – If you have done your research and believe in the narrative of Bitcoin layer 2, you can join and participate in the growth of Stacks and other layer 2 solutions. You can become an LP (Liquidity Provider), early adopter, and so on. This part is often the riskiest and most rewarding.

Based on your knowledge, time available for research and monitoring, and risk appetite, you could pick one or more of the above options.

So far, here’s what we have done:

Set up a wallet to store STX.
Bought STX tokens on a crypto exchange.
Withdrawn STX to the wallet.

Now, let’s explore options for various things we could do with STX.

Note: This article is initially written in April 2024, and things could change really fast in this industry. If you feel this is outdated and need an update, just ping me on Twitter @Creatonicss.

Stacking STX – Stack Token Staking

There are 3 popular ways of Staking STX token:

1. Crypto exchanges (Beginner friendly) –

A few exchanges like Binance offer flexible and locked staking. The rewards are distributed in the form of BTC, which IMO is very good. The max timeframe for which you can lock STX on Binance is 120 days.

2. StackingDao – STX liquid Staking Platform

https://stackingdao.com

StackingDao is the first liquid staking platform on STX. The benefit of liquid staking is that your tokens are liquid; when you stake STX, this platform will give you a token called “stSTX” which can be further utilized on other DeFi apps for generating extra returns.

One important thing to note here is that StackingDao pays rewards in STX tokens instead of BTC.

3. Xverse Wallet STX Staking

Xverse wallet
Xverse Pool website

Xverse wallet has an in-built Staking option, and here you will earn your rewards in BTC. Personally, Even though I like STX, I prefer earning rewards in BTC.

A good idea is to split your staking into StakingDao (Liquid staking platforms) and Locked Staking on Xverse to earn BTC.

Again, there is no right and wrong here, it all depends upon your personal preference and risk-appetite. Liquid staking is preferred by many as it keep their investment liquid, and this is very helpful when things goes south.

4. Lisalab – STX Liquid Staking platform

https://lisalab.io

Lisalab is a newer liquid staking platform by Alexlab (discussed further in this article). Since it’s a project by Alexlab, it instills great confidence, and it would be interesting to see how this one grows and how having competition in the liquid staking space on Stacks will bring healthy innovation.

You can use my referral code “AE3CE” is you decide to join Lisalab.

Decentralised Exchange and More on Stacks (STX)

As we discuss the growth of an ecosystem, it is logical to expect tools like DEXes, lending and borrowing platforms, and crypto bridges, to name a few. In this section, we will explore all of these products that exist and are growing in the Stacks ecosystem.

Alexlab – Launchpad, DEX and more

Alexlab is one of the first DAPPS you will come across when you are interacting with Stacks ecosystem. Here are some of the features of Alexlab:

AMM DEX – Buy/sell your tokens, or provide liquidity to AMM pools.
EVM bridge – Transfer your tokens between EVM and Stacks.
BTC bridge – Transfer your tokens between Bitcoin and Stacks.
BRC20 Inscription – Deploy, Mint, and Transfer BRC20 tokens securely without hassle and unpredictable user experience.
Launchpad – Launch your project token using our lottery-based hybrid Launchpad.

Alexlab also have a token called “$ALEX”, and you can read about it here. If this ecosystem grows and Alexlab becomes the #1 solution, we are looking at next Uniwap or Jupiter in making. Again, nothing Is certain and it all depends on factors like growth and adoption, and competition.

Alex is available on following exchanges:

KuCoin
MEXC
Gate.io

Arkadiko – Mint Stable Coin from the Air

Arkadiko is a decentralized, non-custodial liquidity protocol where users can collateralize their assets and mint a stablecoin called USDA.

To be honest, platform like Arkadiko where you can mint stable coin using liquid token makes me worry.

Imagine this:

You liquid stake STX for stSTX
You mint a stable coin using this liquid staked token (stSTX)
Buy more STX using minted stable coin
Now, rinse and repeat.

This process couldn’t continue indefinitely and could end up creating a bubble, something we have seen happen every now and then in traditional finance. If I see such protocols becoming too large, I will be extremely cautious.

Another platform called Bitflow allows you to convert these minted USDA tokens for USDC. However, when we look at the pool, we can clearly see how unhealthy this situation is.

Again, keeping an open mind and hoping this all will work out, and ecosystem participant will do their best to stop a scenario like above happening (Bubble).

Stackspulse –

Real-time on-chain Stats for Stacks DeFi.

STXTools: Trade analytics and charting tool

Many new projects, both meme and utility, are being launched on the Stacks ecosystem, offering great opportunities for traders and investors to get in early.

Meme projects such as:

$WELSH
$LEO
$NOT

are something to pay attention to. This is not investment advice, but rather something you should not ignore.

STXTools will help you see the charts, recent trades, and also aid in whale watching.

Bitcoin Layer 2 List on Twitter:

I have made a list of notable companies, builders and thought leaders on Twitter (X). If you like you can join it here. This list helps me to stay updated with latest in Stacks and Bitcoin layer 2 updates. Always, happy to share notes and learn from others.

If you want to suggest any new addition here, send me a DM on Twitter @creatonicss