What Is Blockstack and How Does It Work?

Business, cryptocurrency
Blockstack is a blockchain project founded by Princeton-trained computer scientists. Learn more about what they’re doing to prepare for the future.

Blockchain technology is a monumental force that influences many aspects of modern life and likely has applications in areas where it’s not currently being applied. 

Peer-to-peer networks, smart contracts and financial systems are just a few of the obvious realms where we can see blockchain making a change. 

However, there is an area that’s not talked about as much despite blockchain’s growing effect on it: the internet. Combining the two is an ambitious project that a group of Princeton University-trained computer scientists is currently undertaking.

The project is known as Blockstack and its goal is to make an internet for the future based on blockchain.

What Is Blockstack?

Blockstack is a decentralized computing network where users are allowed to both own and control their data. Essentially, Blockstack is an entire ecosystem for decentralized applications that’s aimed at bringing the concept of blockchain to all aspects of the internet. Rather than relying on third-party servers to access data, Blockstack aims to replace these trust points and give users a direct connection to the data through blockchains. 

With this project, the Blockstack team hopes to put a stop to some of the internet’s most prevalent problems such as insecure connections and data breaches. Some experts describe Blockstack’s design as the marriage of the Utility Token model and the Venture Capital model. 

Despite being founded in 2013, Blockstack was relatively unknown until recently. The project made headlines in July 2019 when the U.S. Securities and Exchange Commission (SEC) approved their $28 million regulated token offering. This approval was the first of its kind.

How Does It Work?

The underlying goal of the comprehensive ecosystem of Blockstack is to give every user control over their identity and data. Thanks to the numerous protocols and components, users are able to go from Zero-to-DApp within an hour. 

Here are the necessary parts of Blockstack, i.e. what enables the network to function the way it does.

The Stacks Blockchain

Block chain concept - digital code chain. 3d rendering
The Stacks blockchain is the foundation upon which Blockstack is built.

The Stacks blockchain is the foundation upon which Blockstack is built. 

Not only does the Stacks blockchain provide a coordination layer and global consensus, but it also puts into action Blockstack’s native token known as the Stacks token. To maintain consensus using the Tunable Proofs mechanism, the Stacks blockchain implements a leader election. 

In case you’re not familiar with this mechanism, Tunable Proofs is a leader election system that can take inputs from several different mechanisms and adapt the relative weight of each input. Through the implementation of this system, Blockstack is able to combine the hash power of an established blockchain with the native proof-of-work consensus.

The Stacks blockchain currently incorporates a mixture of Bitcoin’s proof-of-burn consensus and its own proof-of-work consensus. By burning the underlying digital currency, Bitcoin in this case, and completing a set of transactions, you can become a leader or miner. If there’s a match between the ‘winning’ chain and your transactions, you’ll receive a mining reward.

The Stacks Token (STX)

Developed by Blockstack Token LLC in 2017, Stacks is the name of the native token of the ecosystem. Among many other possible activities, users can spend their Stacks Tokens to perform transactions, register their digital assets, anchor app chains and execute smart contracts.

The sale of Stacks tokens started on July 11 with a goal to raise $28 million. Under Regulation A+ the sale is controlled by the SEC, which means purchasers will be required to provide personal information to comply with Anti-Money Laundering (AML) laws as well as Know-Your-Customer (KYC) laws. To participate in the sale by purchasing Stacks tokens, you should visit and register on the registration page of the Stacks token.

If you’re wondering where you should store the STX you have purchased, there’s an official Stacks wallet you can use. The wallet is currently available on Windows and macOS. For increased safety, you should consider using a hardware wallet or paper wallet as well.

Gaia: User-Controlled Storage

As a feature of the Blockstack platform, the Gaia Storage System enables an interaction between the applications and the private data lockers. Rather than using the Stacks blockchain, the Gaia Storage System allows individuals to host these data lockers. The Stacks blockchain only makes a record of the Gaia location of the piece of data. 

According to the Blockstack whitepaper, the design philosophy of such controlled storage is to reuse the existing infrastructure and cloud providers in a manner in which the end-users don’t feel the need to trust the cloud providers. In simpler words, Gaia eliminates the trust put in third-party storage providers like Google and Amazon and grants control to Blockstack’s users.  

Blockstack Authentication

Among the first features of the project is Blockstack Authentication. Thanks to this feature, users are able to connect their identities to all of the Blockstack ecosystem’s dApps. 

The authentication process is done through the utilization of singular sign-on with universal usernames. Instead of passwords, public-key cryptography is put in place that operates on the software of your device. Blockstack Authentication is completely on-chain, and the Blockstack Naming System and the Blockstack blockchain maintain it. The Blockstack Naming System is a registry for user identities and apps and it distributes decentralized public keys.

The Clarity Smart Contracting Language

Analogous to Ethereum’s Solidity, Clarity is the smart contract programming language of Blockstack. As a new smart contracting language, Clarity is optimized for predictability and security, which informs several key design goals that make it different from existing smart contracting systems.

First, the language must authorize quick and accurate static analysis for space requirements and runtime. In order to support this, Clarity is non-Turing complete over a single transaction’s execution. However, the language is Turing complete when examined over the entirety of the transaction history. 

Second, smart contracts will not be compiled but will instead be interpreted by the virtual machine of Blockstack. As written by the developers, the code must be directly distributed on the blockchain. 

To achieve both of these properties, the Blockstack team has created a brand new variant of LISP, specially invented for writing smart contracts.

Blockstack Libraries and SDKs

Open-source contributors and the Blockstack Public Benefit Corp  manage the developer libraries and the core protocols for Blockstack. These developer libraries allow programmers to easily understand how to build new applications on the Blockstack network and allow users to communicate with various applications and components of the network.

To help developers, Blockstack’s developer community has a rapidly growing yet substantial list of tools including libraries for iOS, Android, React Native and JavaScript. 

If you’re interested in designing a dApp with Blockstack, the Blockstack team has provided a tutorial on their website.

App Mining

Due to Blockstack being modular, different components can make different applications independently. 

In their whitepaper, the Blockstack team has stated there were more than 100 applications built on the network in early 2019. The flourishing number of Blockstack applications is showcased at App.co, where every Blockstack-based app can be found. 

Digital composite of Computer servers and bitcoin technology information interface
The concept of mining, when it comes to Blockstack’s blockchain, is broadened as app developers have the ability to “mine” Stacks tokens by publishing quality apps on the blockchain.

The concept of mining, when it comes to Blockstack’s blockchain, is broadened as app developers have the ability to “mine” Stacks tokens by publishing quality apps on the blockchain. Such a method, referred to as App Mining, increases the number of high-quality applications designed on the network, which draws more attention to the network and proves its viability. 

This incentive mechanism has already been put into use because Blockstack rewards the best apps in the network with a $100,000 prize pool every month. The top application collects 20% of the pool, which is $20,000. The next-best app receives 20% of the remaining pool, which is $16,000. This practice is repeated until the pool is completely drained.

To rate applications in the ecosystem, Blockstack has partnered with four major independent companies: Internet Labs, Product Hunt, TryMyUI and Awario. The rankings of each app are fully dependent on the Blockstack features that are integrated, how the app has improved over time and many other aspects. 

Final Words

There’s no doubt that Blockstack has the potential to change the internet and the way it works forever. This ecosystem is ambitious but promising.  So far, the Blockstack team has guaranteed improvement through the continual achievement of set milestones. Even though currently the sale of Stacks Token requires a KYC input, the platform is definitely worth considering.

Comments (No)

Leave a Reply