Blockstack Opens Testnet for New Bitcoin-Linked Consensus Mechanism

Blockstack is ready to let people try out its new consensus mechanism.

Announced Thursday, 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 key to Blockstack's ability to power a new kind of decentralized internet, one that gives users more control over their data and makes it much harder for content to be censored.

The key innovation to this new consensus mechanism: it uses bitcoin. Besides regularly storing a hash of the Stacks blockchain on Bitcoin's, many of the node participants in the blockchain will receive rewards in BTC, a more reliable source of value than rewards in a Stacks' native token, STX.

Read more: Blockstack's New Consensus Mechanism Creates New Use Case for Bitcoin

"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," Blockstack PBC CEO Muneeb Ali said in a statement. "It would literally create a new use case for BTC."

To recap, PoX uses miners and stackers. Miners log transactions, much as miners on the Bitcoin or Ethereum blockchains do, and stackers keep a copy of the blockchain while signaling which fork to mine on. Miners earn new STX from inflation, and they pay to participate in BTC. That BTC gets distributed to stackers, who have to stake STX.

Bitcoin was originally incorporated as a way to tie the security to the most secure crypto network of them all and to give more users a better incentive to actively participate. As the design has evolved, the team has started to see more possibilities.

In an email to CoinDesk, Ali said:

"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."

We covered a similar project with a bridge between Bitcoin and Ethereum being built by Keep.

The testnet

All the BTC and STX on the testnet will be simulated, but there is a tangible reason for developers to take part. Blockstack has a series of bug bounties planned for everything from security to smart-contract functionality.

By participating in the testnet, developers can help Blockstack identify problems and earn rewards.

A few notes on the design for consensus on Stacks that will be tested here:

• The usual threat of losing staked crypto for negligent behavior is not part of the design for "stacker" nodes on the Stacks blockchain.
• Tezos-style delegation has been implemented, so users won't need to run a node in order to participate.
• The threshold for STX needed to run a node has been lowered and will be dynamic, based on the level of participation. Blockstack did not give a specific number but when we last covered Blockstack 2.0 it was 100,000 STX.

The testnet will provide an opportunity for smart-contract developers to try out Blockstack's new programming language, Clarity, which will also be previewed there.

Testnets can be an important opportunity for new networks to drive developer adoption. A report by Electric Capital last year showed that a well-designed testnet has consistently been one of the best tools for getting more developers interested in a new public blockchain.

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