In 2017, SegWit a Bitcoin network upgrade that led to Bitcoin cash was implemented. Over the years, there have been talks of launching a bigger and more efficient network upgrade and it’s finally here.
The Bitcoin Taproot, the much anticipated upgrade has gone live today and is said to be the biggest bitcoin network upgrade after the Segregated Witness(SegWit).
Taproot is a Bitcoin update that guarantees transaction security by keeping details buried. Unlike SegWit, which splits one blockchain account into two (hard fork of the network), Taproot is less controversial.
The Bitcoin Taproot combines complex transactions involving multiple people, making it look like a person-to-person transaction. It was proposed in 2018 by Gregory Maxwell.
To carry out a transaction on the Bitcoin blockchain, you’ll need to input a set of commands. These commands, which require a private key, tell the blockchain what to do.
Usually, the chain handles simple transactions, but complex transactions require multiple signatures before the coins can be spent, mandating a waiting period known as “timelock”.
Sometimes, these coins are spent untimely, leaving data containing details of the people involved in a transaction on an already saturated blockchain, potentially exposing them to easy tracking, and this is where Taproot comes in.
Transaction parties can use Blockchain Taproot to make complex transactions look standard. It uses a device known as Schnorr signatures to combine public keys to one public key and also combine public signatures to one public signature thereby making transactions look person-to-person.
Bitcoin Taproot promises to lower transaction costs by enhancing privacy while reducing the amount of data needed to make them.
Other applications such as CoinSwap that uses time-locked contracts, and Lightning Network which bundles off chain transactions together, will get to benefit from the privacy benefit that Taproot offers.
Gregory Maxwell, the originator, wrote “I believe this development will allow the biggest anonymity for fixed private smart contracts by making smart contracts look like simple payments.”
The upgrade has been backed and supported by Bitcoin miners, reaching their threshold target of 90% after several months of experiencing difficulty with reaching their block production target and if all target remains unchanged.
Don’t miss important articles during the week. Subscribe to blockbuild weekly digest for updates.