Stacks: sBTC is about to be launched. Early users will receive sBTC incentives. How to participate?

Written by: 0xjs@黄金财经

After Bitcoin L2 Stacks completed the Nakamoto upgrade on October 29, 2024, the next major event that the community is paying attention to is the official launch of sBTC.

Bitcoin L2 Labs, an entity under Stacks, recently announced that sBTC is expected to be launched on the mainnet on December 16, 2024.

The launch of sBTC is a key milestone for DeFi and Web3 users to move towards decentralized, 1:1 Bitcoin-backed assets. It unlocks a programmable Bitcoin layer that allows users to bridge BTC to productive applications to generate income, obtain on-chain loans, and trade on decentralized exchanges.

Andre Serrano, head of product at Bitcoin L2 Labs, recently published an article introducing the release plan of sBTC.

Below is the sBTC mainnet launch plan, timeline, and incentives

A quick look at the launch phases

Phase 0: Testnet

The testnet phase focuses on rigorous testing of sBTC's core functionality, including deposits and signer operations. This phase ensures that the protocol reaches security and performance benchmarks before the mainnet launch. Currently, the sBTC working group is actively recruiting signers and developers to strengthen testing efforts and prepare for a seamless transition to the mainnet.

Status: Completed (November 22, 2024)

Phase 1: Mainnet - Bitcoin Deposits

Phase 1 introduces the ability for users to deposit BTC and mint sBTC, connecting Bitcoin to DeFi. This mainnet launch will focus on onboarding users and providing early access to builders. By starting with deposits only, the protocol limits its operational complexity and allows rigorous real-world testing of basic components under controlled conditions.

Early depositors will be eligible to participate in the sBTC rewards program, providing incentives for sBTC adoption.

Expected launch date: December 16, 2024

Phase 2: Mainnet - Bitcoin withdrawals

Phase 2 unlocks sBTC withdrawals, allowing users to seamlessly redeem sBTC for BTC. During this phase, the initial deposit cap will gradually increase to attract more users.

Expected timeline: 6-8 weeks after Phase 1

Phase 3: Open Signer Set + Optimization

During this phase, the sBTC signer set will be decentralized beyond the initial 15 community-elected signers. Expanding the signer set will be a gradual process, with the ultimate goal of becoming a fully decentralized, open, permissionless signer set over time.

Expected Timeline: After Phase 2

Diving Deeper into Phase 1

Phase 1 focuses on the deposit functionality of sBTC. This is the mainnet version with a deposit cap that will provide an important onboarding period for partners. Users will be able to deposit their BTC into sBTC and will be eligible to receive rewards through the sBTC rewards program.

Bitcoin Deposit Cap

A 1,000 BTC deposit cap will be implemented during this phase to allow for controlled testing while ongoing security work is ramped up as the protocol scales. This cap will increase as Phase 1 progresses and transitions to Phase 2.

The deposit cap will be on a first-come, first-served basis, meaning deposits will be accepted based on their order on the Bitcoin blockchain until the cap is reached. Deposits received after the cap is reached will be withdrawn by the user.

Rewards: Bitcoin In, Bitcoin Out

Unlike other incentive programs that rely on opaque point systems and offer alternative tokens as rewards, sBTC gives people what they really want: Bitcoin. Eligible deposits are rewarded with sBTC and can be used in DeFi without the need for staking, locking, or other token derivatives. The program is designed to keep the user experience simple.

Signers: The Backbone of sBTC

The security and reliability of the sBTC protocol depends on its set of signers, which are responsible for managing Bitcoin custody and facilitating deposit and access operations.

The Stacks community recently approved SIP-028, which defines the criteria for selecting signers based on factors such as technical expertise, reliability, performance, and decentralization. An initial set of 15 institutional signers have been selected for Phase 1 to maintain simplicity and reduce operational risk. This group will expand over time as the protocol matures.

As sBTC grows, the set of signers will transition to a fully decentralized model, further enhancing the resiliency of the protocol.

sBTC Early Incentives How Users Can Participate

1. Visit the sBTC dashboard (https://bitcoinismore.org/): This user-friendly interface will guide users through the deposit process and explore applications that support sBTC. The dashboard is currently in private testing and will be available to the public soon.

2. Connect a non-custodial wallet. Use Leather or Xverse wallets, both designed for seamless integration for Bitcoin and Stacks users.

3. Deposit BTC. Follow the instructions to deposit Bitcoin and receive sBTC in return.

4. Earn rewards. Once your deposit is processed, go to the rewards website (https://bitcoinismore.org/) to start earning BTC rewards immediately.

5. Deploy sBTC in DeFi. Visit one of the featured sBTC applications to exchange, lend or borrow on-chain sBTC as collateral.