- One of the greatest improvements is Bitcoin privacy.
- Core developer Greg Maxwell suggested Taproot.
The Bitcoin network’s largest update in four years has finally arrived. The Taproot update will improve Bitcoin privacy by changing the network’s signature method and reducing transaction fees. Ether, the king of altcoins and the ultimate Dapp and DeFi network, may also be jeopardy.
Core developer Greg Maxwell suggested Taproot in January 2018. In June, BTC miners overwhelmingly supported it. The developers have since tested and reviewed the update. It became live on the BTC blockchain yesterday, November 14.
The goal is to make Bitcoin more private, safe, and scalable for its users. All of this adds to Bitcoin’s usefulness. Taproot’s activation has developers and users ecstatic, and rightly so. It might rekindle Bitcoin’s flame and make it the ideal cryptocurrency.
Signature Algorithm
One of the greatest improvements is Bitcoin privacy. The taproot will eventually modify Bitcoin’s signature algorithm. Signatures on Bitcoin are like a fingerprint that the user leaves on every transaction done through the wallet.
For years, it depended on the Elliptic Curve Digital Signature Algorithm to produce signatures from the wallet’s private key. It will now use Schnorr Signatures to protect Bitcoin transactions. Multi-signature transactions will be essentially unintelligible. The change is due to the activation of BIP 340.
However, Schnorr Signatures will not make Bitcoin a privacy currency like Monero or make transactions untraceable. The taproot will also help spread smart contracts on Bitcoin. Smart contracts are now accessible on Bitcoin’s core layer and the Lightning Network. But few see Bitcoin as a smart contract platform. Ethereum dominates this market.
Indeed, smart contracts are the main reason Ethereum has risen. So they’re behind Dapps and DeFi, which have made Ethereum the dominating force it is today. They enabled NFTs. The taproot will make Bitcoin smart contracts simpler to execute, cheaper, and take up less space on the BTC blockchain.
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