John Isige
The leading Bitcoin layer 2 blockchain protocol, Stacks, is on its third consecutive green candlestick over a 30-day period in addition to a 230% rally. Stacks price continues with its uptrend undeterred by many uncertainties ailing the crypto market both from within and from the outside.
STX price has returned double-digit gains of 14.50% in the last 24 hours to exchange hands at $0.98 at the time of writing. CoinMarketCap shows a 5.54% increase in daily traded volume to $473 million, suggesting investors are still keen on accumulating more STX tokens.
Note that consistent spikes in trading volume often point toward a continued uptrend or if you’d like – investors are speculating on the upswing continuing without major glitches. Stacks market share has been growing in tandem with the Stacks price to $1.33 million and currently ranks as the 41st largest crypto.
What’s Driving the Stacks Price Rally?
Stacks is one of the few coins that kept the aggressive push from early January alive throughout February as the rest of the market struggled to hold onto the gains made. Investors’ concerns have recently revolved around the rising inflation and increased regulatory oversight of the industry by agencies from in the United States.
Despite the Federal Reserve hiking interest rates by 0.25% in early February, the Consumer Price Index (CPI), jobs data, and PCE Price Index for January is suggesting inflation is still a stumbling block to the growth expected for risky asset classes in 2023.
For instance, the PCE Price Index for January jumped 5.4% in reference to a year ago and compared to 5.3% recorded for December. Investors are concerned because market watchers expected the PCE Price Index at 5.0% for January. Furthermore, the core rate – the index excluding the prices of food and energy ticked up by 4.7% in reference to December’s 4.6%, and significantly higher than the economists’ expected growth of 4.3%.
On a month-over-month basis, the PCE Price Index climbed 0.6% in January, beating December’s 0.2%, while surpassing expectations of a 0.5% increase. Similarly, the core rate jumped 0.6%, above December’s 0.4%, and the market watcher’s expectation of a 0.4% increase.
On the other hand, Stacks price shows no signs of slowing down the uptrend amid growing interest in non-fungible tokens (NFT) hosted on the Bitcoin network. For a long time, smart contracts, DeFi applications, and NFTs were a preserve of other networks like Ethereum, Solana, and Cardano but not Bitcoin.
However, the team behind Bitcoin’s layer 2 blockchain, Stacks is slowly rewriting the narrative, by enabling the minting of Ordinal NFTs. Developers have always considered enhancing the Bitcoin network’s scalability. Arca from Talati told CoinDesk developers initially lacked either consensus or information to make it happen.
“A lot of people have been saying, ‘Well, if Ordinals do really well, this gives a reason for people to use the Bitcoin network, and therefore they’ll have the need to use Stacks,’” Arca said.
Despite Stacks price exploding in the last few weeks, the technology supporting NFTs on Bitcoin is yet to fully roll out. Interested market participants are currently trading Ordinals via an over-the-counter (OTC) platform supported by bids and asks.
“Ordinals is a recently developed method to identify and trace the individually smallest units of a bitcoin, called satoshis (equivalent to 0.00000001 or 1 x 10^-8 BTC), where each unit is assigned an ordered number,” a CoinShares report reads in part.
For NFTs to succeed on Bitcoin experts say the community must commit to bringing up the infrastructure, including access to marketplaces like on Ethereum. However, not everyone is pleased with the introduction of Bitcoin Ordinals, with some saying it might worsen network congestion.
Can Stack Price Surge To $10 as Bitcoin NFT Hype Grows?
Stacks price remarkable performance over the last few weeks is a testament to people expecting the protocol to make Bitcoin Ordinals accessible to users through the facilitation of minting activities as well as hosting of marketplaces.
The development team behind Stacks on February 22, said it will soon release a new upgrade of the protocol, Stacks 2.1. According to the announcement, the new protocol is designed to enhance the blockchain’s capability – adding an EVM compatibility feature and the synthetic Bitcoin (sBTC) via a secure bridge to Bitcoin (BTC).
Additionally, the .BTC naming service is hosted on the Stacks protocol, a feature likely to elevate STK’s status in the market as demand for .BTC addresses grow. At the moment, it is not possible to send and receive Bitcoin with .BTC addresses compared to .ETH addresses, which are fully functional.
However, users should not worry because the upcoming Stacks’ software upgrade will support the direct sending and receiving of Stacks assets to BTC addresses. In other words, users will gain access to the Bitcoin blockchain through a proxy while eliminating the need to have a different Stacks address.
Assessing Stacks Price Short-Term Profitability
Stacks price long-term bullish outlook of $10.00 would depend largely on how users embrace the new features on Bitcoin. However, some analysts fear that STX has exhausted the uptrend and a trend correction is due.
Meanwhile, the weekly time frame chart shows STX is yet to make a 61.8% Fibonacci retracement to $2.16, which means there is still room for recovery. Stacks immediate support has been provided by the 23.6% Fibo but bulls must resolve to push above the acute seller congestion at $1.00 to keep the rally intact.
In case of a trend reversal due to a possible rejection from $1.00, investors may want to lock in the gains made and prepare to enter new buy orders around $0.6630 – support cemented by the 100-day Exponential Moving Average (EMA) (line in blue). The 50-day EMA (line in red) strengthens STX’s major support at $0.50.
Still, the Moving Average Convergence Divergence (MACD) indicator on the weekly chart affirms the optimistic outlook for Stacks price. This buy signal on the weekly chart first appeared in late July but could hold the uptrend intact as investors look forward to gains aiming for $1.50 and an all-time high of $3.37 in November 2021.
Stacks Alternatives To Buy Today
Before you start accumulating Bitcoin, do you know about these new cryptos whose presales are selling out quickly in 2023? Investors are diversifying their portfolios with the best crypto presales, promising a better risk-reward ratio.
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This article was written for Business 2 Community by John Isige.
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