Key Points
- Bitcoin’s layer 2, Stacks [STX], is set to undergo a major upgrade named the Nakamoto upgrade.
- Despite the impending upgrade, the token’s price action remains bearish, sparking questions about its potential to reach $2.
The Nakamoto upgrade, named after Bitcoin’s anonymous developer, is expected to significantly increase transaction speed. However, despite the impending upgrade, the market sentiment for the associated token, Stacks [STX], remains bearish.
The Nakamoto Upgrade
The Nakamoto upgrade is designed to separate Stacks’ block production schedule from Bitcoin. According to the official document, the upgrade will bring several benefits, including increased transaction throughput and 100% Bitcoin finality. Under the new system, the production of Stacks blocks will no longer be dependent on miner elections. Instead, blocks will be generated at a predetermined rate.
Despite the promising upgrade, the STX token has not seen much benefit. Data from CoinMarketCap revealed that STX’s price dropped by more than 5% in the last 24 hours, with the token trading at $1.84 at the time of writing.
Will STX Reach $2?
With the token’s trading volume increasing while its price drops, many are questioning whether it’s viable to expect the token to touch $2 in the near future. Analysis of Santiment’s data shows that STX’s Weighted Sentiment dropped significantly last week, indicating a rise in bearish sentiment and a lack of confidence among investors. Additionally, STX’s Long/Short Ratio saw a dip, suggesting more short positions in the market than long positions, which is typically a bearish sign.
Despite the current bearish trend, analysis of STX’s daily chart suggests that a breakout above the rising triangle could push the token well above $2 in the coming days. However, only time will tell if the Nakamoto upgrade will stir up enough bullish sentiment to drive the token’s price up.