In a note to investors, Franklin Templeton highlighted the potential of the Stacks protocol to drive new use cases on the Bitcoin network.
According to the asset management company, which operates one of the US-listed Bitcoin spot ETFs, the Layer2 Stacks protocol could help Bitcoin unleash its full potential.
In the note, Franklin Templeton focused on the next update that will come to this L2 protocol, called “Nakamoto”, which will be implemented in mid-April.
Nakamoto, the next Stacks update
The Nakamoto update aims to improve the overall performance and capabilities of the Stacks network as a layer of the Bitcoin ecosystem, allowing transactions on the L2 to be as secure as on the main network. In addition to this, the investment asset manager highlighted that the next Stacks update will introduce improvements focused on increasing the scalability of the network and the capabilities of using Bitcoin in decentralized protocols (DeFi) through the sBTC token.
In the note, Franklin Templeton indicated that Stacks is one of the most important developments in the Bitcoin ecosystem, as it unlocks the ability of this blockchain network to implement smart contracts and decentralized applications (DApps). Therefore, it is a layer 2 solution that has helped Bitcoin overcome one of its biggest limitations, the company indicated.
Stacks takes advantage of Bitcoin's robust security to implement different decentralized applications where BTC, the network's native cryptocurrency, is used as currency. This, according to Franklin Templeton, has increased the potential for Bitcoin to be used as a productive and more scalable asset within other digital ecosystems, while ensuring security.
TVL Increases on Bitcoin Stacks Network
The total value locked in the Stacks network has been increasing as the deployment of the Nakamoto update approaches. According to data published by Franklin Templeton in the investor note, the L2 network maintains nearly $120 million in TVL, a value that marks an important milestone in its growth.
Since the middle of last year, the TVL deposited in Stacks has multiplied exponentially, growing by around 600%.
Source: Franklin Templeton
According to the firm, this growth has occurred amid the expectations that the Nakamoto update is generating to improve the performance and scalability of Stacks and to enhance the use of BTC. “Users expect and anticipate that the network will have high performance and allow for greater activity after the implementation of Nakamoto,” the note noted.
La Nakamoto update is set to fulfill Stacks' original vision of creating a fully expressive Bitcoin layer that can unlock hundreds of billions in Bitcoin capital, according to Stack Core developers.
In the middle of the month, Franklin Templeton also published an investor note talking about memecoins, which have become a viral phenomenon within the crypto industry, capturing the interest of thousands of investors. The company indicated that this type of digital assets have no intrinsic value but that, even so, they could help investors generate quick profits.
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