As a decentralized cryptocurrency, Bitcoin is constantly being developed by a crypto community. Today, we’ll talk about a so-called Taproot upgrade of BTC. We explain what this upgrade is all about and how it will help Bitcoin in the medium and long term. Let’s get started!
Bitcoin Continues to Evolve
The Taproot upgrade is the most important Bitcoin upgrade in recent years, which was praised by the Bitcoin community just over a week ago. This means that enough miners support the upgrade. In order for an upgrade to be supported, at least 90% of all blocks must give their signal to support the upgrade.
In this case, that was 1,815 out of 2,016 blocks. Although this update is only a small adjustment, it will play a significant role in BTC scalability and data protection aspects.
Now it’s time for a waiting period of approx. 5 months, during which miners and nodes have to update a Bitcoin Core software in order to implement the upgrade. If a block height of 709,632 is reached in November, the taproot upgrade is activated automatically. Then all Bitcoin developers will have an opportunity to actively use new tools such as Schnorr signatures.
What Is Bitcoin Taproot All About?
As you probably know, complex transactions can also be made in the Bitcoin network, e.g. so-called multi-signature transactions. These have to be signed by different participants in order to be valid.
The Taproot upgrade makes it possible to make multi-signature transactions look like ordinary transactions. Network participants have to ‘combine’ their public keys in order to derive a new public key. This process is made possible by Schnorr signatures. Another advantage besides the increased level of privacy is the lower costs for multisig transactions.
The Bitcoin Taproot upgrade was originally proposed in 2018 by Gregory Maxwell, one of the core developers of Bitcoin and former CTO of Blockstream. Schnorr signatures were developed by a German mathematics professor Claus Peter Schnorr as a cryptographic scheme for digital signatures.
Conclusion: Bitcoin Price Isn’t Everything
Anyone who invests in Bitcoin shouldn’t only care about its price, but also about constant further developments of its protocol. Because these are necessary to create or optimize future possible BTC applications. The Taproot upgrade is just a small code change, but it will still have a big impact.
Many investors will particularly like the increased level of privacy associated with multi-signature transactions. It also shows that the decentralized Bitcoin network, consisting of all the nodes, is working fine. We’re curious to see how the upgrade will go in November and what further developments are coming up next.
What other interesting facts about the upgrade do you know? Feel free to share your knowledge in the comments!