Stacks, the largest Bitcoin layer-2 network, is gaining attention this week with the rollout of the Nakamoto upgrade.

The Stacks token (STX) was trading at $1.80 on Monday, Aug. 26, marking a 68% increase from its lowest level in August. This surge coincides with the developers beginning the implementation of the Nakamoto upgrade, a pivotal event in the platform’s history.

According to a recent post by the developers, this upgrade will significantly enhance the network. It aims to reduce the average transaction time from 10 minutes to just seconds. This improvement will enable new use cases such as minting liquid stacking tokens, depositing them into Decentralized Finance (DeFi) applications, and borrowing against liquidity.

The Nakamoto upgrade will facilitate the interaction with DeFi apps in seconds, implement DeFi strategies that require fast blocks, and onboard builders focused on high-throughput use cases on Bitcoin.

The upgrade will also pave the way for the upcoming sBTC, an asset pegged 1:1 to Bitcoin. This will streamline the use of Bitcoin in DeFi, non-fungible tokens (NFTs), and gaming. Unlike wrapped Bitcoin (wBTC), which is managed by a single custodian, sBTC will be decentralized, offering features like censorship resistance, cost efficiency, and high security.

Once the upgrade process is complete, developers anticipate it will attract more creators in sectors like gaming and NFTs.

In recent years, layer-2 networks have seen substantial growth. Arbitrum has emerged as a significant player in the industry, while networks like Base, Optimism, and Blast are gaining momentum.

Currently, the STX token has rebounded from its low of $1.0638 earlier this month to $1.80. In this recovery, the token has moved above the 50-day moving average and flipped the upper side of the descending channel into a new support level. It has also slightly surpassed the 61.8% retracement point. The token may continue to rise as bulls target the 50% retracement point at $2.11, which is 20% above the Aug. 26 level.

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