One of the most significant upgrades in the history of Bitcoin has been activated on Block 709632. Let's take a closer look at the Taproot Upgrade and its advantages.
What Is Taproot?
The Taproot upgrade proposal was first announced by Bitcoin Core developer Greg Maxwell in Jan. 2018. In Oct. 2020, protocol developer Pieter Wuille submitted a “pull request” for Bitcoin’s next Soft Fork. This request means more developers will review the code and the upgrade is one step closer to being implemented into the protocol. Validators must adopt Taproot’s new consensus for the upgrade to be fully implemented. Depending on how this occurs, activation can take months.
The Taproot upgrade, which will increase Bitcoin’s smart contract flexibility while providing greater privacy, is one of the most anticipated technological upgrades to the Bitcoin protocol since the release of SegWit. The purpose of the upgrade, which offers new, more efficient, flexible, and private ways for Bitcoin transfers, is to change the way Bitcoin scripts work to improve privacy, scalability, and security.
The Advantages of the Taproot Upgrade
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Enhanced Privacy: By making complex transactions that require Multisig indistinguishable from on-chain P2PKH transactions, Taproot aims to minimize on-chain information about the conditions required for a transaction output.
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Reduced Transaction Fees: With Taproot, transaction data sizes required for complex Bitcoin transactions that require Multisig such as SegWit and Lightning Network are significantly reduced.
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Scalability: Since Taproot enables complex transactions using a single signature, bite sizes for combined keys and signatures stay the same regardless of how many signers are involved. In P2SH transactions with Multisig, at least 8.5 bytes are required for each additional Public Key.
Taproot will contribute significantly to the Bitcoin network in terms of privacy and scalability. Its focus on the two biggest problems of the Bitcoin network and the integration of effective solutions such as Schorr Signatures and MAST make Taproot one of the most anticipated technology updates to the Bitcoin protocol. For more information about the Taproot Upgrade, you can read our article here.
