The long-awaited upgrade of Bitcoin Taproot has now finally been confirmed by the nodes. For this confirmation, at least 90% of the mining nodes for the taproot upgrade had to be correct. So this year is the first change of consensus of Bitcoin since the introduction of Segwit in 2017.
Simply put, Taproot is a soft fork for Bitcoin to improve code, increase privacy, and reduce the complexity of transactions.
Strictly speaking, the Taproot upgrade consists of three Bitcoin Improvement Proposals (BIPs), each of which has three different effects. These include the Schnorr signatures, Taproot itself and Tapscript. The BIPs 340, 341 and 342 are collectively referred to as the Taproot Upgrade.
The BIP 340 contains the Schnorr signatures. The introduction is intended to increase data protection and reduce transaction costs. This is due to the saving of storage space for the public key and the signatures previously executed via EDCSA (Elliptic Curve Digital Signature Algorithm). With this saving of storage space, more transactions can be confirmed in one block and thus the transaction fees for Bitcoin users decrease.
BIP 341 describes the protocol that must be integrated into the Bitcoin script so that Schnorr signatures are accepted by the system at all.
The BIP 342 integrates several opcodes, ie codes that fulfill different functionalities. This implementation enables P2TR transactions to be carried out.
The integration of the P2TR (Pay-to-Taproot) makes it possible to increase the data protection of Bitcoin. With Taproot, the code for a smart contract can no longer be distinguished from that of a single transaction.
As of Saturday, June 12, 2021, over 90% of the mining nodes confirmed the introduction of the Bitcoin Taproot upgrade. This majority of 90% is necessary for the introduction of the soft fork.
On the website Taproot.watch there is an overview of the number of approvals, rejections and abstentions in the vote. It is easy to see there that the required 90% has been exceeded and the taproot upgrade is being introduced.
Some of the largest mining pools have been supporting Taproot for a while. These include AntPool, F2Pool or Slush Pool. Activation of taproot is set for block 709632. This block is expected to be confirmed on November 14, 2021.
Bitcoin core developer Pieter Wuille emphasizes the importance of Taproot:
It is the first consensus change since Segwit was activated in August 2017. It is expanding Bitcoins Scripting capabilities in a way that makes certain things cheaper (especially more complex applications like Multisig and Layer 2 things) and a little more private by often using the exact output regulate.
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