Taproot upgrade comes in Bitcoin. What it is? Explained.

Introduction

The Bitcoin network recently underwent a major technical update called Taproot on Sunday, November 14, 2021, which was pending for a long time. Let us tell you that this is the biggest update of the bitcoin network since 2017. This will give developers the ability to integrate new features on bitcoin to improve privacy, scalability, and security. In this article, you will also know what is taproot activation.

Expectations were being raised about this update since June, and 90 percent of the miners gave their support to it. Thereafter, a waiting period was introduced between the lock-in and the activation date. This waiting period has given node operators and miners time to fully upgrade to the latest version of Bitcoin Core, 21.1, which includes the merged code for Taproot. Only after doing so will they be able to enforce the new rules that will make it possible to use the new type of transaction.

Let us now talk that what will be the benefits of Taproot Upgrade. Before that, let us know what is Taproot?

What is taproot?

Simply put, Taproot is an enormous package or bundle of technical updates in the history of bitcoin, which came as a major update. This concept was first proposed by Greg Maxwell in 2018. Since then, the three Bitcoin Improvement Proposals (BIPs) that codified Taproot were Peter Wuille, Tim Ruffing, A.J. Towns, and Jonas were written by Nick and merged into Bitcoin Core in October 2020.

This Taproot update contains the main Schnorr signatures. Right now, bitcoin is using ECDSA, a cryptographic algorithm for its "digital signature", where a user signs a transaction with his private key to allow the transaction to be sent elsewhere. Whereas the Taproot upgrades to a unique plan called Schnorr. Every transaction using Taproot will now use this new digital signature scheme, adding capabilities designed to promote the privacy, security, and scale of bitcoin transactions.

Besides being smaller and faster than ECDSA, Schnorr signatures have the added benefit of being "linear", a combination that would boost the transaction confidentiality of bitcoin, and more lightweight and complex "smart contracts" (an encoded contract with self-executing rules) will allow.

Taproot will have many positive results for various projects throughout the ecosystem. For example, multi-signature transactions (in which over one group of signatories is required to sign the transaction) will be cheaper and useless data.

After Taproot, these things will increase -

Privacy

The taproot is part of a larger effort by developers around the world on a mission to improve bitcoin's privacy because its transaction history is so public. An inquisitive user can view any transaction sent on Bitcoin using a public block explored, such as Mempool space. This is still the case with Taproot, but the details of some more complex transactions (often called "smart contracts") will be hidden. For example, while Lightning Network transactions currently stand on the blockchain, Taproot offers them the possibility of looking like any other transaction, which further enhances transaction privacy.

Scalability

With the new upgrade, transactions with multi-signature wallets will look like any other transaction. This will increase the privacy and security of the transaction. This will eventually make way for smart contracts, eliminating the need for middlemen. This will bring Bitcoin's network to the level of Ethereum's speed. Ethereum naturally enables smart contracts.

Summary

Hope you have liked the information about what is Taproot and you must have got important information. You can also visit Taproot's official website, taproot.watch for more information. If you liked this article, then share it with your friends too, thanks!