The world’s oldest and most popular cryptocurrency has received its first update in several years and with its new Taproot code upgrade, Bitcoin will now offer improved security and privacy.
Bitcoin’s Taproot went into effect over the weekend when the cryptocurrency reached block 709,632 and this is its first major upgrade since 2017.
By introducing a new type of signature called Schnorr signatures, Taproot will help Bitcoin transactions become more private, efficient and cost less. At the same time though, this new upgrade will make it easier for smart contracts to be executed on the blockchain using Bitcoin.
Rival cryptocurrency Ethereum has gained notoriety in recent years in part due to the fact that it is easier to create smart contracts using its blockchain. While Ethereum will likely still be the go to cryptocurrency for smart contracts, Bitcoin’s Taproot upgrade will help narrow the gap between the two when it comes to creating smart contracts.
Taproot upgrade
According to a new report from CNBC, the Taproot upgrade is a collection of three separate upgrade proposals for Bitcoin.
In addition to helping facilitate smart contracts over Bitcoin’s blockchain, the new upgrade will increase privacy for certain transactions because Schnorr signatures will allow for multi-signature transactions. These transactions, which involve multiple addresses, will now appear as a standard, single transaction giving those involved greater anonymity and privacy.
Scnorr signatures will also reduce the amount of data needed for multi-signature transactions despite the fact that they are more complicated to process when compared to standard transactions. Not only will this make transactions cheaper but as less data is involved, transactions will become more efficient in terms of how much energy and time is used to complete them.
Now that Bitcoin has undergone its Taproot upgrade, the cryptocurrency will likely see a new wave of innovation since it can be used as an alternative to Ethereum when putting together smart contracts.
We’ve also featured the best bitcoin wallets
Via CNBC