Stacks’ Muneeb Ali: Let the Bitcoin L2s Bloom

On January 2nd, Muneeb Ali, the CEO of a prominent Bitcoin Layer 2 Stack, altered his Twitter bio from “founder @Stacks” to “wartime founder @Stacks.” This modification suggests that Ali views 2025 as a critical period for Stacks, requiring a shift in focus towards market penetration and expanding their user base. The previous year, 2024, had seen significant technical advancements, including the implementation of the long-awaited Nakamoto update, which significantly boosted the project’s speed and ensured finality for all transactions on Bitcoin.

Based on Ali’s assertion, it seems that the revised direction for Stacks could be particularly apt, considering the current surge in the cryptocurrency market, driven largely by the election of Donald Trump and anticipation of a friendlier climate for crypto innovation.

In a conversation with CoinDesk, Ali stated, ‘The shift in our approach is indicating to the community that these times call for swift and bold actions.’ While there may still be improvements to our products in 2025, I would emphasize that our primary focus will no longer be on product development.

As an analyst, I’d like to share my personal insights regarding the Nakamoto upgrade, Lightning Network’s progress, bitcoin’s price forecast for 2025, and my ambitious vision of onboarding one billion people onto the blockchain through Stacks.

Firstly, if given a chance, I would have approached the Nakamoto upgrade differently to ensure a smoother transition and maintain the original spirit of decentralization.

Secondly, I find it intriguing that despite its potential, the Lightning Network’s adoption for Bitcoin payments seems to be advancing at a slower pace than anticipated. I eagerly await further developments in this area.

Thirdly, regarding bitcoin’s price, I foresee a significant increase by 2025, driven by increasing institutional interest, improved regulatory clarity, and broader mainstream adoption.

Lastly, my ultimate goal is to leverage Stacks to bring one billion people onto the blockchain, making it an integral part of everyday life for the global community.

In February, I am honored to be a speaker at Consensus Hong Kong, where I look forward to discussing these topics and more with fellow enthusiasts and experts in the field.

Join us for a special series hosted by Consensus Hong Kong! Don’t miss out on the most impactful Web3 and Digital Assets event happening Feb. 18-20. Register now to get a 15% discount using the code CoinDesk15.

This interview has been condensed and lightly edited for clarity.

So where does the Nakamoto upgrade stand now?

I’m convinced that Bitcoin could greatly benefit from an advanced Layer 2 (L2) solution. The main reason is that the user experience (UX) at the L1 level won’t significantly improve; you can’t expect fast, affordable transactions at this layer. This has been a significant draw for many towards Lightning Network, which has been in existence for some time, seen some adoption, but not on a massive scale. Let’s be honest about its current status.

It appears there’s still a demand for Bitcoin transactions that are both extremely swift and user-friendly. In my opinion, Solana outperforms Lightning Network or any other solution in this regard significantly. One of our objectives is to develop a Bitcoin Layer 2 system akin to Solana, allowing instant transfer of any amount of funds with an excellent user experience. I believe this is one target we’re aiming for with Nakamoto.

Is there anything you would have done differently with respect to Nakamoto’s rollout if you could?

Reflecting on the rollout of Nakamoto, as a researcher involved in its development, I can say it unfolded progressively. In April, we initiated the movement of the core consensus capital. Subsequently, we introduced fast blocks, although they didn’t fully cater to more intricate transactions. A subsequent release followed, enabling complex transactions as well. However, upon reflection, it felt like a staged rollout rather than a full launch. This led to heightened expectations at each stage, only to be met with the realization that ‘it’s not here yet, it’s not here yet.’ Consequently, by the time the complete launch occurred, I believe some of the initial excitement had waned.

Will there be a trend towards focusing more on developing and coding on Bitcoin rather than Ethereum and other blockchains by the year 2025, according to your opinion?

I believe my perspective aligns with yours. Bitcoin, in many aspects, stands alone, persistently remaining relevant even amidst the dynamic landscape of public markets. Many companies are now incorporating Bitcoin into their treasuries, which underscores its widespread adoption. Last year, there was a significant buzz surrounding Bitcoin L2s, but it appears to have waned slightly. However, I am convinced that due to its fundamental nature, Bitcoin will continue to captivate interest.

How do you think Donald Trump will affect the course of Bitcoin?

A substantial number of individuals he’s choosing, such as David Sachs in the roles of crypto and AI leader, hold significant influence at Multicoin Capital and have extensive knowledge about cryptocurrencies and Solana. I believe this will bring about a considerable change. Similarly, some of the other advisors Trump is appointing are beneficial in this regard. For the past four years, the U.S. government and regulatory bodies have been primarily antagonistic towards us. However, I anticipate they’ll now actively assist and foster growth instead, which represents a significant shift in perspective. This change is highly advantageous.

Should the Bitcoin Reserve plans materialize anywhere, it would send a massive, worldwide ripple effect. Regardless of whether it’s implemented at the state level, such as in Texas or Wyoming, it would undeniably make a significant impact globally.

What’s your guess on where bitcoin’s price might be at the end of year?

I continue to support the idea that we’re on a four-year cycle, with this particular cycle wrapping up in Q4 2025. While there are arguments suggesting that future cycles might not be as intense, I remain optimistic. Frankly, I wouldn’t be shocked if we hit $150,000 before the end of the year, and I believe it’s possible for us to reach $200,000 – that would be my upper limit.

When are we going to see fast and efficient payments via bitcoin?

We’re attempting to bring it into fruition independently. I believe Lightning Network should receive considerable recognition due to its dedicated fanbase. However, the technology was intricate and not straightforward to incorporate, and the Bitcoin community primarily backed one project. I think the solution is to allow numerous trials and observe what captures interest. What excites me about Bitcoin L2s with various projects emerging is that now we’re witnessing multiple experiments taking place. If Lightning Network proved challenging to integrate, let other projects take a crack at it.

Attending a Bitcoin conference or listening to influential figures such as [MicroStrategy Founder] Michael Saylor might give you an impression that the prevailing view is that Lightning Network is not just a viable solution, but the sole one. They rarely discuss other Layer-2 (L2) solutions, and this could be due to the fact that some of these alternatives have their own tokens which the Bitcoin community tends to disfavor. However, it seems they are gradually becoming more open to considering other options.

What are you excited about discussing at Consensus Hong Kong?

How can we make Bitcoin accessible to a billion individuals? This question sparks our interest and influences many of our technological choices. When aiming for such a large user base, one of the first solutions that come to mind are L2 (Layer 2) platforms, as on the original blockchain, it’s practically impossible for a billion people to own individual Unspent Transaction Outputs (UTXOs). It’s not widely recognized by the Bitcoin community that a billion users cannot hold UTXOs directly within the Bitcoin network.

In our field, the topic of true self-custody and direct control over Bitcoin isn’t often discussed, but it’s a crucial aspect. While platforms like Coinbase, Binance, and even ETFs are commonly used for onboarding people to Bitcoin, they don’t fully embody the essence of Bitcoin. Bitcoin is about decentralization, empowering individuals to have direct control over their own assets, rather than relying on intermediaries. Let’s remember our original mission.