Blockstack Launches Testnet for New Bitcoin-Related Consensus Algorithm

Blockstack is ready to let people try out its new Bitcoin-linked consensus algorithm, with the testnet already accessible.

Announced on April 23, the Blockstack testnet is open. Developers can now simulate the Stacks blockchain’s new, hybrid consensus mechanism, which Blockstack calls Proof-of-Transfer (PoX).

A functioning blockchain is crucial for Blockstack’s ability to drive a new kind of decentralized internet, one which gives users more control over their data and makes it much more difficult for content to be censored.

The main innovation to this new consensus algorithm: it utilizes Bitcoin. Besides regularly storing a hash of the Stacks blockchain on Bitcoin’s, many of the node maintainers in the blockchain will be rewarded in BTC, a more reliable source of value than rewards in a Stacks’ native token, STX.

Blockstack PBC CEO Muneeb Ali commented:

“A successful trial of Proof of Transfer would signal a viable third option that relies instead on Bitcoin as a foundation for Web3 going forward. It would literally create a new use case for BTC.”

PoX uses miners and stackers. Miners validate transactions, just like miners on the Bitcoin or Ethereum blockchains do, and stackers maintain a copy of the blockchain while signaling which fork to mine on. Miners get new STX from inflation, and they pay to take part in BTC. That BTC is distributed to stackers, who have to stake STX.

Bitcoin was initially included as a way to link the security to the most secure crypto network of them all and to give users a better incentive to actively participate. As the design has changed, the team has started to realize more possibilities, according to Ali:

“Users can do thousands of transactions on the Stacks chain and the Bitcoin chain only sees a hash of the Stacks block. It starts to become more interesting when you start exploring potential movement of assets or cryptocurrencies between these chains e.g., Bitcoin getting locked on the Bitcoin chain and being used … on Stacks. This area is currently in R&D phase but we’re really excited about the possibilities.”

The testnet

All the BTC and STX on the testnet will be simulated, but there is a good reason for developers to try it. Blockstack has several bug bounties for everything from security to smart contract functionality.

By participating in the testnet, developers can help Blockstack find problems and get rewards.

The consensus which will be tested on Stacks is designed in a following way:

The usual threat of losing staked crypto for negligent behavior is not characteristic of “stacker” nodes on the Stacks blockchain.

Tezos-style delegation has been used, so users will not be required to maintain a node in order to participate.

The threshold for STX needed to maintain a node has been lowered and will be changeable, depending on the level of participation. Blockstack did not give a specific number, but earlier its was 100,000 STX.

The testnet will also allow smart contract developers to try out Blockstack’s new programming language, Clarity.

Testnets can be a major opportunity for new networks to broaden developer adoption. A 2019 report by Electric Capital indicated that a well-designed testnet has consistently been one of the best ways to attract more developers to a new public blockchain.

The Stacks blockchain was launched in late 2018. Blockstack expects a mainnet launch of its new consensus algorithm, Blockstack 2.0, this summer.