Drawing inspiration from the BRC-20 token standard, STX-20 is a new token protocol on Stacks. The protocol offers a way to create and share digital artifacts on Stacks through inscriptions. The token’s developers created it to be a gas-saving alternative to conventional smart contracts for specific use cases.
Let’s dive in and discuss STX-20 tokens and the best compatible wallets.
What is Stacks?
Before we dive into STX-20 tokens, let’s take a quick look at what Stacks is, the protocol these tokens operate on.
Stacks is a Bitcoin layer that links to Bitcoin through its consensus mechanism, Proof of Transfer. The link between the two networks allows Stacks to utilize Bitcoin’s security.
On the Stacks network, dApp developers can create apps that apply trustless and permissionless Bitcoin principles. The apps on Stacks use the Clarity smart contract language, prioritizing safety and security.
Clarity smart contracts can read the state of the Bitcoin base chain, allowing developers to use Bitcoin transactions as triggers in their transactions. The language allows developers to confirm the capabilities of a smart contract even before execution.
What Are STX-20 Tokens?
STX-20 tokens are a fungible token protocol on Stacks that leverage the transaction memo field to inscribe information. Minters embed protocol information with the metadata of STX token transfers. Indexers use the data to establish the state using deterministic protocol rules.
Every inscription has a permanent record on Stacks, ensuring immutability with the protocol rules available for scrutiny. Transaction memos on Stacks have a 34-symbol limit, and the developers behind STX-20 tokens tailored them to fit within the memo limit. Here are some additional STX-20 token protocol specifications.
STX-20 tokens adhere to the principles of decentralization in three key ways:
- Community-driven development: Protocol development relies on the community’s views with decisions made through a democratic process.
- Limited indexer authority: Indexers can only provide a view of the blockchain data. They cannot manipulate or alter the data.
- Decentralized control: The protocol does not rely on centralized control like some conventional smart contracts rely on DAOs.
Top STX-20 Wallets
Let’s take a look at Bitcoin wallets that already provide STX-20 token support.
Xverse
The Xverse STX-20 wallet is the market-leading Bitcoin Web3 wallet that supports Stacks (STX) and Stacks-based assets. Available on mobile (iOS, Android) and as a browser extension, Xverse is a non-custodial wallet that allows you to store, send, and receive STX-20 tokens without relinquishing any control of your private keys.
Chrome users can download the Xverse extension to manage their tokens, while mobile users can download the app on their Android or iOS devices. Once you’ve fully set up the wallet, you can connect it to the STX-20 marketplace to trade the tokens. You can also mint STX-20 tokens on the Xverse STX-20 Token Mint App.
Let’s look at some of Xverse’s merits and demerits.
Pros
- Security: Accessing the Xverse wallet requires a 6-digit PIN and biometric authentication. In case you are unable to access your wallet, simply use the 12-seed recovery phrase to regain access.
- Privacy: Given the wallet’s self-custody nature, Xverse collects limited personal information. The information is then stored on the platform’s server with strong security measures to limit unauthorized access.
- Convenience: You can access the Xverse STX-20 wallet as a mobile phone app or install it as a Chrome browser extension. Xverse offers options to suit the varying needs of its users.
Cons
- No charting tools: While beginners will appreciate the app’s simple and user-friendly interface, advanced traders looking for advanced in-app charting tools to help them with their trading decisions will be unsatisfied.
Leather
Leather is available as a browser extension (Edge, Brave, Firefox, and Chrome) and a desktop application (Windows, macOS, and Linux). The mobile app version is still in development as of February 2024.
Formerly known as Hiro wallet, Leather is Stacks-compatible and allows users to hold STX-20 tokens. Once you’ve installed the wallet and finished setting it up, you can use it to manage your STX-20 tokens.
Let’s look at some of Leather’s merits and demerits.
Pros
- Self-custody: Just like Xverse, Leather Wallet enables users to remain in control of their private keys.
- Robust security: Leather offers assurances to users that it employs security measures to ensure their holdings are safe.
- Minimalist approach: Leather Wallet’s features are easy to use due to their simplicity.
Cons
- No charting tools: While beginners will appreciate the browser extension’s simple design, traders looking for advanced in-app technical analysis tools will be disappointed.
- No mobile version: Leather is only available as a browser extension and a desktop app.
Bottom Line
STX-20 tokens are relatively new, as they only were launched in December 2023. Therefore, they are currently only listed on the project’s internal marketplace.
The project’s team has communicated that plans are underway to introduce decentralized trading features once ready. Until then, you can mint and then store STX-20 tokens using Xverse and Leather.
