The Bitcoin Network (BTC) activated its soft fork Taproot after reaching a block consensus of 90% from its miners and mining pools last November 14. It aims to improve the Bitcoin network’s privacy and scripting capabilities through the Merkelized Abstract Syntax Tree (MAST) concept.
Soft Fork Taproot update was done between blocks 709,488 and 709,632 and was seen as Bitcoin’s first major update since August 2017 when Lighting Network and Segregated Witness (SegWit) were released.
As per the Taproot website run by Hampus Sjöberg, a well-known Bitcoin developer, ‘[MAST] can help make smart contracts more efficient and private by revealing only the relevant parts of the contract when spending.’
Sjöberg also stated that Taproot can help improve the privacy of the old Lightning Network and help in doing network upgrades, which is critical for the Bitcoin network’s long-term viability.
The Taproot upgrade is a collection of 3 upgrade requests called Bitcoin Improvement Proposals (BIPs) namely Schnorr or BIP 340, Taproot or BIP 341 and Tapscript or BIP 342. These proposals had reached a 90% consensus among miners on June 12, 2021, locking in their November activation as a soft fork to Bitcoin’s protocol.
This major update improves the overall flexibility, security, and efficiency of the Bitcoin network in a number of ways including increasing privacy and anonymity using Schnorr signatures, cutting down fees, improving the efficiency of the Lightning Network and enhancing smart contract capability. This will also allow the Bitcin network to execute smart contracts on the blockchain.
The Bitcoin network has gone through multiple community-driven hard and soft forks in its nearly 13-year life, one of which is the Segregated Witness (SegWit) released in 2017 that came with the Bitcoin Cash (BCH) hard fork. Around 50% of transactions used SegWit two years after it was activated then four years later, that number has noticeably increased to 80%.
Taproot adoption is expected to boost slowly over a period of years, similar to how SegWit grew slowly over a period of years. While the Taproot update has yet to show its benefits, Lightning Network continues to grow.
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