Bitcoin layer-2 network Stacks (STX) kicked off its Nakamoto upgrade, which is expected to boost transaction speeds. STX price, however, still appears to be in bearish waters.
Nakamoto Upgrade to Enhance Txn Speed on Stacks Network
The upgrade will decouple the block production of Stack’s network from BTC. This will enhance block production and speed up confirmation times from minutes to just 5 seconds.
The staking cycle lasts 2100 BTC blocks that formulates a rough 14-days time window to implement the Nakamoto upgrade. Thereafter, a final hard fork block will complete the process.
Using a proof-of-transfer (POX) consensus algorithm, the miners of Stacks will burn BTC rather than electricity. This update introduced this new way to mine newer Stack blocks and earn rewards in STX form.
For the curious, miners are rewarded in STX, it’s essentially the fuel for the network. The Stacks network has aimed to introduce greater utility of various defi functions using BTC as its base layer. To this end, fostering sBTC adoption is a priority, which would be a bridging asset that would enable users to bridge their BTC to the Stacks network.
Analyst: STX to go Bullish in the Long Term
Despite the positive upgrade in Stacks, the analyst @DKellerCMT (David Keller, CMT) anticipates lower highs in the short term. However, he didn’t specify the duration of the bearish stint.
Keller noted that STX is strong in the long term. The token is likely to lay low until the upgrade is complete, later, the chart could display a steady uptrend.
EMA Bands Dampen Price Momentum
On April 1st, 2024, STX got a 820% filip, however, the trend was reversed thereon, due to a major sell-off from $3.84. As the price entered a strict correction phase, it followed a downward wedge for nearly 150 days.
This week, STX price failed to make it past the upper border. The bearish momentum dragged STX under the 20, 50, and 200-day EMA bands; a resurgence is unlikely.
The RSI at 50.05 edged above the median line after breaching the 14-SMA. The median line shows that the price could deteriorate more on the break of the median line and could hit the lower border of the wedge if bearishness accelerates.
Likewise, the MACD indicates that the bulls have lost momentum. Both lines are likely to form a bearish cross soon. If the bearish cross materializes, it would confirm that a longer bullish spell lay ahead.
So, as per price action, the movement depends on the investor’s and traders’ biases. STX was trading at $1.612 at press time, with an intraday dip of 0.17%. If the crypto experiences goes bullish, the upper targets would be $2.0 and $2.50. However, if STX fails to sustain above the $1.50 level, it could plummet to the key support at $1.0 or even lower.
