Build DeFi on Bitcoin with Hiro

All right, we're live. GM everybody. Welcome to what's going to be another great DevNTell, brought to you by our friends at Pokt and Zerion. So if you didn't know, DevNTell is a 30-minute podcast for builders to showcase something they're passionate about or working on in Web3. It can be an awesome project you've been working on, demonstrating unit testing best practices, automation goodies, smart contracts, how to structure a project, etc. Basically, if you've got a passion for something, this is your opportunity to share it with the Web3 community. And today, I am ecstatic to have Max from Hiro Systems, who's going to be giving us an awesome overview of how to build DeFi and Web3 with Bitcoin. Welcome Max, happy to have you on.

Narb, I'm really happy, really looking forward to this. I can't wait to get into it.

Yeah man, it's going to be a good one. Folks, you want to stay around for this. I guess before we get into the meat of the content, did you want to give a brief introduction about yourself, Max?

Yeah, I'd love that. Thank you. So hi everyone, my name is Max, I'm Developer Advocate at Hiro. Hiro is a developer tooling company. We make software tools to help developers build specifically on Bitcoin and Stacks. And it is Stacks and Bitcoin that I'm going to be talking about today. And I understand that this is going to be a little bit of new, relatively, for Developer DAO, given that Developer DAO is a Solidity and EVM kind of first community of developers. So I'm excited to open up the world to you all of what it is that's going on in Bitcoin and what it is that's going on in Stacks, which is what we call one of these Bitcoin layers. These kind of application spaces that make building on Bitcoin a little bit easier, given that Bitcoin, one of the things about it is that it's quite hard to build on. And that's because it is so simple. It does one thing and it does it very, very, very well. It does it so well that we don't think it's ever going to go down. And building on it can be a little bit challenging, but that's what these Bitcoin layers make possible, like Stacks.

So Stacks has been around for I want to say about seven years in some iteration, but the actual blockchain was released in late 2020, early 2021. And through a novel consensus mechanism, it is intimately tied up with Bitcoin and therefore inherits and relies upon Bitcoin security by recycling its proof of work, the Bitcoin proof of work. And so ultimately, reorganizations of the Stacks chain to create fraudulent transactions would require reorging Bitcoin. So basically, about as secure as it gets when it comes to Stacks chain state reorganization. So we have these like nice good qualities of security, but now we're also bringing smart contracts. So I'm excited to set up for you all like why it is that you should care about Stacks and then once you see the opportunity, then how it is that you might build on it, how you might take advantage of it, which is where Hiro comes in. So Hiro the developer tooling company, we create the development environment tools, we have virtual machine runtime environments that you could test, deploy, etc., your smart contracts, and then also we create the like JavaScript and front-end frameworks for building the front ends for your applications.

So think the world of EVM with all these decentralized applications, that is where it is that we're going today, but it's going to be from a different set of tools, a different framework, like a slightly different set of tools. But the main spirit of the thing is very familiar to you all. So it's not going to be a, you know, it's not like it's 2009 and we're explaining blockchains. No, it's 2023, you all know what blockchains are, you all know what decentralized applications are, but the zero to one new innovation is actually bringing it to Bitcoin. A little bit about me by the way, so Max, I'm Developer Advocate at Hiro, I've been there for a year and a half. I like to say that I first came into the space back in like 2011 or 12 when I bought Bitcoin for I think it was like four and a half or five dollars and then sold it when it was ten dollars and thought I was a genius.

And I call that my, I think I did the math, I think it was like a forty million dollar summer. So I did not have any concept of what it is that Bitcoin would amount to. Obviously since then my attitude has changed and me alongside others now actually see it as not just like a triviality, but something revolutionary and worth building on. So I create educational content and head up Developer Relations at Hiro and that's why I'm here. So with that, I can jump into my presentation, which will be basically just a little bit of overview of Stacks and then I'm going to set up what is a real part of the opportunity. So Stacks is not just an L1, like there are so, so many of, like we've seen since 2021 in particular this explosion of L1s and interest. It is an L1, you know, it's a top 50 or so market cap L1. It's actually the only blockchain that has a Reg A filing with the SEC. So there was no initial coin offering, it was an actual like legit SEC offering. And yet the thing that makes it special is particularly something that we're calling sBTC. sBTC is a trust-minimized, decentralized, programmatic Bitcoin asset that exists on the Stacks chain, or that will exist. We have it in testnet and final production is slated for early summer next year. So that is actually also what kind of highlights the sense of opportunity. Like now is the best time to learn these tools and learn how to build and then actually have your application ready such that when sBTC goes live and people can bridge their native Bitcoin into Stacks, then burn it and have native L1 Bitcoin again, that you can be ready for whatever influx of interest and usership that may come. So Stacks, sBTC, and then lastly resources for how to learn how to build and some other stuff. So with that, I am ready to share my screen. Should I hit present and...

Yes, yes sir. Got a lot of good stuff coming here, excited.

Okay. Yeah. And any questions so far, Narb? Should I just jump right into it?

None that I see. But everybody says good morning to you. Good morning y'all. Yeah. But on that note, gang, if you do have questions for Max, please post them in the comment section and we will get to them during the session. But for now, let's get your... there we go. Awesome.

So I'm going to just go over just like you know a few... going to keep this relatively short and sweet and all of these are going to be links that you can visit, I'm going to drop all of them at the end. And this is all this information is there's plenty of it, so I'm going to keep it at like the high level. We're not going to get really into the nitty gritty of how to build because there are plenty of resources. And then also we have a workshop with Developer DAO in January and in February. So when it comes time to actually like hearing again from me how it is to use these tools and to build, we have plenty of resources there. Here I'm just still setting up and introducing what Stacks is and what the opportunity is. And mind you again, I'm at Hiro. Hiro was formerly known as Blockstack and they were the primary developers of Stacks but then rebranded to Hiro and now we do just dev tooling and Stacks is like a public blockchain like any other. Okay, so the Stacks Foundation which is a nonprofit foundation runs stacks.co which has all of the information here about what Bitcoin layers are and opens you up to not only some understanding more about what Stacks is, including its novel consensus mechanism known as Proof of Transfer. This is a way in which Stacks miners actually secure the network, what they do is they spend Bitcoin. That Bitcoin then goes to other participants in the ecosystem, people that stack their STX. Now these are not like it's kind of a play on the term stakers. This is not a proof-of-stake chain but there are people that lock their STX and they earn a Bitcoin yield for doing some of the work in securing the network. This Proof of Transfer recycles Bitcoin's proof of work and it's how it is that Stacks builds upon Bitcoin security. So there's tons of information about that. Clarity smart contracts, Clarity is a smart contract programming language. It is not Solidity. It is a decidable non-Turing complete language, which at first is a slightly different like programming shift. It's not a declarative language like we're used to like in JavaScript say. And because it's decidable, it is a lot more secure than Solidity is. There are just a host of exploits and bugs that are just not even possible in Clarity because of the methodology of its design. And we have found that every single kind of application you could build in DeFi, you can build with Clarity. So it's just more secure and Clarity virtual machine is what the Stacks blockchain kind of maintains and then that's where all of our smart contract applications exist.

And then lastly sBTC. This is that one-to-one programmatic Bitcoin asset that is... we actually just hit code completion on one of the major parts of the blockchain upgrade. So the two blockchain upgrade names to keep in mind, Nakamoto and sBTC. These are what are creating like faster block times, we're shooting for like five-second block times, because Bitcoin's as everyone may know, ten-minute block times. Well we have, we're going to have much faster block times with Stacks on the Nakamoto upgrade and then the other component of that is sBTC, this programmatic Bitcoin asset. This is a way to from a Clarity smart contract write transactions to the L1 Bitcoin state, which is you know in a trust-minimized way is we have not... it's kind of the Holy Grail in Bitcoin. How do you do that from another blockchain in a trust-minimized decentralized way? And then some more information and then lastly or lastly on the stacks.co site, if you want to go to the explore here... there are already a number of applications in Stacks. So these are all decentralized applications that exist. We have ALEX which is our biggest DEX on the chain. Arkadiko is a kind of like a MakerDAO stablecoin lending application. And there are a ton of others. Console is a Discord replacement. Gamma is a was a premier NFT marketplace. LNswap, you can do atomic swaps between Bitcoin and Stacks. There's a number of applications I encourage everyone to look at them. But also there's still a lot of applications to be built. Like if you look at you know DeFi Llama and you sort by TVL, there's still applications like major application primitives that don't yet exist on Stacks. So there's a lot of opportunity to just be the first one to build some of these things.

And you know just to give you like a taste of the user experience, this is ALEX, this is the largest DEX on Stacks powered by Stacks. Also they have pivoted to also include trading BRC-20s through an order book model. Now one of the things that has really brought attention to Bitcoin, building on Bitcoin is Ordinals. So a number of, there are a number of, the way though that Ordinals are primarily traded and and exist, like activity exists kind of on the L1 through they involve these indexers and partially signed Bitcoin transactions and it's a lot, but developers are actually solving a lot of pain points and being able to actually transact with BRC-20s which are the ERC-20 fungible token equivalents. So this is a Bitcoin L1 activity that ALEX, which is powered by Stacks, is facilitating some of the trading of and you know deeper and integration between Stacks and Bitcoin is coming with these Nakamoto and sBTC upgrades. So you know we the the wallet of choice is something known as Leather wallet. Leather wallet formerly used to be known Hiro wallet but it was spun out as a separate entity now. So now the Leather wallet is both a Stacks wallet and also a Bitcoin wallet. So you're able to provide kind of Bitcoin-first experiences for users that have this Leather wallet. It's a really cool new paradigm of... some people, the kind of vision we have is people have native Bitcoin and then use like smart contract decentralized applications and they don't even know that Stacks is underneath. That's how kind of seamless the vision for Stacks integrating with Bitcoin is. And you know just like any other, xBTC is a somewhat trusted... it's a non-custodial but oh it's a trusted Bitcoin synthetic, which is just kind of a random application. Here again very familiar like swapping pop-up if anyone's familiar with you know most or any DeFi application. So ALEX is the biggest here. Arkadiko, here's another application. They have a couple of apps including these self-repaying loans, if anyone just remembers Alchemix I believe was like the innovator there back in 2021. Same thing again just you know kind of motivating some of the user experience for these applications similar to the kind of DeFi applications we're all used to. But again this time on Stacks and with Bitcoin as a kind of primary unit of currency.

Now I've talked a lot about sBTC. sBTC is that again, kind of think of it as like the Stacks Bitcoin, this is the 1:1 programmatic asset that's coming middle of next year. And this sbtc.tech is going to be the one one-stop shop for all information pertaining to it. So you know anything from the overview deck which will allow for just like kind of presentation style pitch about what sBTC is making possible, to you know facts about sBTC, to then also the roadmap and updates about not only when it hits production but also the various testnet public testnet milestones. So we already have a public testnet sBTC, there will be like further and more feature-complete versions of these testnets all the way up to production and mainnet over the year. So you can already build now with an sBTC on testnet so that you can have whatever your vision for an application is, you can already you know kind of get started and interact with a testnet asset.

Okay so that's a lot of there on the Stacks side. I'm going to talk a little bit more about on the Hiro side. hiro.so is the site for the company that I work for. If anyone's interested in like joining our newsletter and hearing more about what it is, we've got an excellent newsletter. You go to hiro.so, you can sign up here in this green box and subscribe. That's like a really fantastic place to just keep abreast of the developer-related information pertaining to Stacks and building on Stacks and Bitcoin. So that's just a shout out there. And you'll see that we have a number of tools to build not only with Stacks but also Bitcoin and more specifically Ordinals. So you know we maintain a public open source explorer, so if you go here this is a explorer for Ordinals. You'll see most inscriptions these days really relate to Ordinals activity. Like the vast majority of Ordinals activity is BRC-20. So Hiro maintains an Ordinals Explorer that's open source, you can fork it and play around with it yourself. And then also you know blockchain data indexers like Chainhook on the Stacks side we have other blockchain data indexers, Chainhook. And then we also have this really cool thing called the Platform. I want to speak about this platform for a moment. So already clicked into it here, the Platform is a one-stop shop for building and deploying Clarity smart contracts. I'm just going to open it up here. Here is... I'm going to go to... this is like the the home page with my projects and you know I can create a new project. And these are going to be like example smart contract applications that I can start with. All of this is in-browser. I can also import from GitHub a so-called Clarinet project. Clarinet is our local development tool and you can import Clarinet projects and turn them into this Platform-based development projects.

And then also by the way there's an opportunity to import your local development environment and so actually you know not even use just your the web-based default settings but you can SSH your local development environment into it and so all of your you know all the things that you're used to when it comes to your your terminal you know like Bash or Zsh profile you can actually import with and then work with the platform. I'm going to just click into this is a project and open up one of the editors and you'll see here like some of the... this is the smart contract. This is a standard non-fungible token collection contract written in Clarity and I can do you know from here I can then go back and actually deploy it if I were to you know then connect my wallet I could then deploy this directly from the browser to our blockchain. This is a we have made Hiro has made a number of I'm going to go back to this overview of all of our Stacks tools. We have a number of like Clarinet is this local development environment tool that simulates local blockchains this and that. We have Stacks.js as like a front-end framework. We have a ton of tools that work for developers' local environment and we are just increasingly putting all of that into Platform. So that's a one-stop web-based shop for deploying developing and deploying a full stack Stacks applications. So definitely check out the Platform, a lot of love went into this. We are super close with developers that use it and get a ton of feedback but you know stuff like this is like really state-of-the-art tooling for creating you know full stack decentralized applications. So really, really excited about that.

And lastly is our documentation. docs.hiro.so, here you'll see all of our Ordinals tooling as well as all of our Stacks-based tooling. And you'll see the Hiro platform as well. One thing I want to highlight is we are right now undergoing something called Hiro Hacks. Hiro Hacks is a challenge competition where we have one, two now three different like you could think of them as like a weekend build. So you can just show up here and then kind of start hacking away. Now these do assume some familiarity with Clarity. So this is like your kind of intermediate stepping stone. The place to start would be to learn Clarity, which in some of the the links I'm about about to drop and provide you all, Clarity Camp is a self-paced course so you can start learning actually the smart contract programming language and then from there you can go back to our docs and visit these Hiro Hacks and you can get started building a friend.tech clone, a decentralized grants program, custom blockchain API. And we're going to continue to expand on what are these hacks. So these are like end-to-end tutorials so where you you could actually get started because there's a core of each of these tutorials where you are copying and pasting. Like you're not really you know creating new code, you're just taking what is. But then there's a number of challenges for each of these hacks that have you stretch into like okay, like write new functionality, like how would you please your user? What would be like a new user experience to deliver or create? So you guys can get started here but also the the Clarity Camp.

Now don't worry, I have a ton of links, we're going to provide them all. But I just want to summarize that what it is that we have here is the a new blockchain, actually not new, a few years old, but new in that some of the features that are coming to it are going to be bringing Bitcoin one-to-one programmatic Bitcoin in a decentralized and trust-minimized way. That's the promise of the sBTC protocol is is that it's not going to be you know a custodian that's approving these transactions. It's going to be an open decentralized set of signers that are going to be managing this 1-to-1 Bitcoin bridge. And that's going to be coming up soon. In the meantime, there are already a number of decentralized applications and now is the perfect time to learn how to build with these tools, build using these like new primitives, and get ready for you know the Bitcoin halving is in April and sBTC comes out, like the Nakamoto upgrade is in April as well, sBTC comes out right on the heels of that. Now's a perfect time to get started using these tools, get a lay of the land and create the next decentralized application that will see you know all this increased interest in the space. So I think that's I think that's it on the presentation side and Narb, I will kind of stop there and then we can transition into any Q&A, any feedback. I'd love to know what you thought of the presentation and what you think of the kind of opportunity to build on Stacks.

Yeah for sure. Yeah, this was an excellent overview. So quite clearly there's a lot of tooling and all the necessary infrastructure in place for people to get started building. I guess with all all these tools in place, how easy is it for a primarily Solidity developer to get started with Clarinet, for example? So if they want to if they want to get started coding with Clarity, what's the learning curve to get going with that? Do you from your past experience, do you think it's harder to learn than Solidity, just as just as hard?

Yes, so it it took to get it it it's to get as proficient it's like it's a new language and so there's like there is a run-up and the the first kind of new thing to learn is the difference like between these like decidable and... so decidable language does not have for loops and does not have conditional jumps, which is like it's like a very common way for developers to solve problems. Now it doesn't mean that you can't iterate or you know or you know or you iterate or something like that, you can. So there's a little bit of learning that the Clarity Camp is the best way to get started learning there where you learn some of the the you know the primitive data structures and then how to create functions. I would say the Clarity Camp is the best way to start learning on the smart contract side. And then another phenomenal resource is the Bitcoin Builder's Primer. This is a way to build a full stack Bitcoin and Stacks application assuming basically next to no knowledge specific to Bitcoin and Stacks. So you can be a developer, not know anything and this is like an end-to-end course that also includes some introduction about Clarity but then also some front-end development and also knowledge of Bitcoin, which for people that are not familiar with it, Bitcoin is different on a number of levels from other blockchains. Primarily for instance on the UTXO model versus the accounts model. Which I'm not going to get into here, I mean I could, but there's a number of things that make Bitcoin different and then this course like really tackles and addresses. So it would be like these two courses would be a fantastic way to get started. And then the workshop that we're hosting in January with Billy Jitsu and Developer DAO, either myself or another Developer Advocate will be there, that'll be a great way. And then we have a ton of educational content if you go to stacks.co and you come to this Learn, there's just a number of ways to stay in the loop and to like read these tons of educational content that the foundation maintains as well as Hiro.

And you know I'll also say, because I will also drop my email address, that's a fantastic way to get in touch so in addition to our newsletter and if you want to get a hold of me personally, oh if you want to drop I'll drop my email, maxim.efremov@hiro.so, that's a phenomenal way to get a hold of me. And I would say that that Clarity Camp and that Bitcoin Builder's Primer gets you started with you know the basics, the tooling, getting your development environment set up, that would be a great place to start.

Excellent. Yes, and we'll be sure to drop all this information in the YouTube description so don't worry if you're scrambling to copy all these links, we got you covered there. So that was a great response. Rapha has a great series of questions, I don't know if we'll get to all of them but first one start here. Can you explain OP_DROP and sBTC? Also which oracle technology if there is any can we use with Stacks?

Yeah, thanks Rapha. So OP_DROP... so OP_DROP is what is known as an op code in the Bitcoin paradigm. It is actually when you construct transactions on the L1 on the Bitcoin L1, you are manipulating data say like you know counting how much Bitcoin you want to send or you know composing address destinations to send it. Those are operations and each operation even like addition subtraction you know doing the verification of a of a signature, all of those are specific unique operations that have their own op code. And OP_DROP is one of them as well as OP_RETURN. OP_RETURN or... yeah so basically in when it comes to sBTC bridging, there's been the sBTC core engineering team had one way that's been the primary way in which these the the bridging from Bitcoin to Stacks would would contain it would include containing information in one of the op codes. And recently in the last few weeks we actually had a breakthrough in just in a more in a clever in a clever way actually using a different op code that makes less less Bitcoin L1 transactions required in order to do the bridging. So that's the specific there. I'm not following the core engineering very closely on the OP_DROP versus OP_RETURN. So that's that's about the limit of what I could say there. And then as far as oracle technology, yeah, so we're pleased to announce that Pyth, the organization that is that makes Wormhole possible, Wormhole is the kind of like Solana-first but multichain bridge bridging consortium. They use a data like a data standard and data availability standard called that Pyth maintains. Pyth just launched, I think I actually were announcing it today, their integration with Stacks. And so you have access to Pyth signed price data for all of the pricing pairs that they have that they maintain which is a number of I mean like kind of yeah a lot. You can go to pyth.network I believe it's called. Pyth network and also you can visit the Stacks-Pyth bridge and see the Hiro Systems Hiro's repo pertaining to how to use the price oracle in a smart contract. Yeah.

Awesome. And we got a little bit of Alpha here on DevNTell today. Great question Rapha. And a follow-up to this, how does a five-second block time on Layer 2 compare to benchmarks for other Layer 2 solutions? I think what Rapha's getting here is how does the performance of Stacks as a Layer 2 compare to the performance of Layer 2s on EVM Layer 2s? Can they expect the same sort of scalability?

Yeah, so yeah Layer 2s are it's an I was just talking to Bob Bodily yesterday. He's a CEO and founder in the Bitcoin layer space. He made an Ordinals marketplace called Bionic. And he and I were having this conversation about how like like sidechain and Layer 2 are just like like unless you take a a really expansive view on it, there are so many different kinds of Layer 2s and sidechains and things like that. So but that's to say yeah there are a number of L2s and Stacks when it was first made and in its current iteration in its current epic we're calling it before before we get to Stacks 3.0, we're in Stacks at 2.0 era, Stacks 3.0 will be Nakamoto and sBTC. Stacks actually anchors onto a ten-minute block time with Bitcoin, which when we when Stacks was first made a few years ago seemed like a a natural way to do it and also I think the engineering for it was like a bit more like straightforward posting you know Stacks block hashes to the Bitcoin chain every transaction every Bitcoin transaction. And then we found yeah that users are now increasingly... I mean this is actually before you know the 2021 L1 explosion, which definitely demonstrated the market's desire and appetite for preference for very fast block times. So that Stacks you know took that cue and then with the Nakamoto upgrade we're going to have faster block times that are just more consistent with what what it is that that most other L2s and even L1s kind of provide which is in the order which is in the range of like seconds instead of minutes. Yeah when when Bitcoin was made I don't I don't think I'd be curious exactly why ten minutes was picked and not a few seconds like Ethereum, but anyway yeah Nakamoto upgrade will bring block times kind of in the in the same ballpark as we see with other L1s and L2s today.

Awesome. Great to hear and great questions Rapha and gang. I guess we're approaching time. Just to cap things off here, how can people get in touch with you and follow the latest and greatest from Hiro and Stacks on social or wherever?

Yeah so definitely follow our Twitter. I could have this already loaded up. So Hiro is the the Twitter to follow. Go to hiro.so for the the newsletter follow. My email is dropped there, maxim.efremov@hiro.so, that's a phenomenal way to get a hold of me. And then also we have when you follow you can tag you can @HiroSystems directly and you will get responses from us or from our social media team. And yeah and then we have another Developer Advocate Ryan Weights as well as another Dev Advocate for the Foundation Kenny Rogers. Super knowledgeable team here and happy to answer any questions. And also we dropped that one-dash-tab link here in the comments. That has a handful of links for how to get started, signing up for the newsletter, getting started coding, and a number of educational resources. That'd be the best bet.

Awesome. Yeah, and gang this is the best time to start learning something new. As many of us probably have some off time, and no better time to get started with developing on Bitcoin than now. And this will get you really prepped up for the workshops to come in the new year. And yeah, really looking forward to seeing what people in the community start to build with Bitcoin. Thank you so much Max. I really appreciate you coming on, you and Hiro taking the time to educate us and really looking forward to like I said how the community are all the cool things the community will start to build.

Yeah me too. I can't wait. It's already blowing me away and I'll see you all at the January workshop. We'll announce the dates, you guys follow Narb and the Developer DAO Twitter and Hiro's Twitter and we'll announce the specific date for that workshop in in like middle January. But there's already a ton of places to get started, so I'll see you all in Discord and on Twitter.

Excellent. And before everybody leaves, I want to share the QR code and for everybody to fill out the form to claim your NFTs for being a attendee here on DevNTell today. So what you want to do is take your regular QR code scanner on your phone, scan this bad boy, fill out the form, and you will be airdropped a attendee NFT for attending DevNTell today. You will have a hour and a half from now to fill out this form to get airdropped your NFT. And with that, just want to wish everybody a very happy Friday, happy weekend, and we'll catch you all back here next week for the final DevNTell of 2023. All right gang, all the best. Bye everybody.