The long-awaited Bitcoin (BTC) upgrade has been confirmed after breaking the 90% minimum threshold for miners’ approval in mid-June, it will be implemented in November.
While Taproot’s core features – enhanced privacy and improved wallet scripting – are well known, how could Taproot affect Bitcoin in a broader sense? Will it lead to more adoption, dissuade users from privacy coins, or even draw the wrath of regulators?
How Taproot Can Affect Bitcoin – The Benefits Taproot Can Bring
Here are the 3 main benefits Taproot will bring to Bitcoin:
Reduced fees for complex / multiple signature transactions: Taproot reduces the data requirements for processing complex transactions, such as B. in the case of multiple signatures or time locks, considerably. This is great for anyone who needs extra security.
Increased privacy: In combination with Schnorr signatures, Taproot enables users to combine transactions with complex wallets (e.g. multi-character or time-locked) with those that only use individual signatures. Thus, anyone concerned about disclosure of their multisig usage would allow anyone to hide that usage.
Extended wallet functionality: Taproot allows developers to set more complex conditions for the wallet. For example, it will allow developers to create multisig wallets that initially require 3 out of 5 signatures to confirm transactions, but can degrade to just 2 out of 5 signatures of the number 5 over a period of time. This is ideal if you expect to lose one of your private keys.
These are the core features that Taproot offers. And almost all developers agree that such features will be widespread, but not immediately.
“I expect Taproot-enabled features to be very widespread when downstream applications integrate them, as they give apps that offer valuable functionality a competitive advantage and reduce costs,” said a Bitcoin developer who requested anonymity.
Other developers agree that we will have to wait for applications, wallets, and protocols to implement Taproot before fully announcing its positive effects. For BTC wallet developer and service BTCPay Server founder Nicolas Dorier, the taproot rollout is unlikely to be as widespread as it is for SegWit, especially for users who only need payments in one signature.
“It will be widely used for other protocols based on Bitcoin (like Lightning). In the chain, Taproot makes the use of these protocols indistinguishable from others. The benefits of multisig from such improvements will certainly follow, but will existing multisig wallets migrate to Taproot? He asked, adding that the answer to this question was still unclear.
“To enjoy privacy, some of the more complex protocols (musig2) need to work,” he said, noting that current multisig wallets may not be worth the effort.
For bitcoin writer / teacher / developer Jimmy Song, the multisig wallet will gradually integrate Taproot, but not immediately.
“Not much at first, but more over time. There is a need for good backup solutions so I think wallets will have them built in, ”he told Cryptonews.com.
How Taproot Could Affect Bitcoin’s Competitiveness
The question is: will integrating Taproot’s capabilities make a real difference to Bitcoin’s value proposition?
“I hope it will appeal to people who really understand the value of security. Altcoin players are interested in token price increases, not autonomy, so I doubt such people will not be too interested in taproot, ”said Jimmy Song, suspecting a bear market.
Nicolas Dorier notes that Taproot isn’t really going to cut fees for the vast majority of Bitcoin users who tend to use wallets and single signature transactions. However, he left open the possibility that acceptance could be expanded in the long term.
“Personally, I don’t think Taproot will attract more people to Bitcoin. Perceived value will come from the protocols that can be built on, and it is difficult to predict if some new popular protocols like Lightning will come out, ”he said.
Dorier also stressed that Taproot won’t have a huge privacy impact in the short or medium term.
“I would say that by the time it becomes widespread for protocols on bitcoin, it could even have a negative impact by making taproot transactions stand out from the crowd. It’s temporary, ”he said.
In other words, it would be naive to believe that Taproot will help Bitcoin lure users away from other coins – including privacy coins like Monero (XMR) – in the months following its release. Instead, it may take even longer for its benefits to impact competition.
How Taproot Could Affect Bitcoin Regulators’ Attitudes
By and large, Taproot is unlikely to take control of regulators or cause those regulators to lower Bitcoin any further.
“I don’t see this getting a lot of attention from governments. Jimmy Song said, “Cross input signature synthesis is possible, but at least it’s another soft fork,” said Jimmy Song.
Nicolas Dorier largely agrees with this assessment, if only because the use of complex wallets is still quite low.
“I don’t expect any action from regulators,” he said. “Those who are trying to protect their privacy with Bitcoin already have many ways to do so, and Taproot’s ability to improve on this is small at best.”
While the immediate impact of Taproot will remain minor, it is without a doubt the most significant Bitcoin upgrade since SegWit. Because in the long run, it will provide Bitcoin users with more security and privacy.
Join our Facebook group and Telegram group Coincu News to chat with more than 10,000 other people and exchange information about the crypto currency market.
Important NOTE: All content on the website is for informational purposes only and does not constitute investment advice. Your money, the choice is yours.
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How can Taproot affect Bitcoin?
The long-awaited Bitcoin (BTC) upgrade has been confirmed after breaking the 90% minimum threshold for miners’ approval in mid-June, it will be implemented in November.
While Taproot’s core features – enhanced privacy and improved wallet scripting – are well known, how could Taproot affect Bitcoin in a broader sense? Will it lead to more adoption, dissuade users from privacy coins, or even draw the wrath of regulators?
How Taproot Can Affect Bitcoin – The Benefits Taproot Can Bring
Here are the 3 main benefits Taproot will bring to Bitcoin:
Reduced fees for complex / multiple signature transactions: Taproot reduces the data requirements for processing complex transactions, such as B. in the case of multiple signatures or time locks, considerably. This is great for anyone who needs extra security.
Increased privacy: In combination with Schnorr signatures, Taproot enables users to combine transactions with complex wallets (e.g. multi-character or time-locked) with those that only use individual signatures. Thus, anyone concerned about disclosure of their multisig usage would allow anyone to hide that usage.
Extended wallet functionality: Taproot allows developers to set more complex conditions for the wallet. For example, it will allow developers to create multisig wallets that initially require 3 out of 5 signatures to confirm transactions, but can degrade to just 2 out of 5 signatures of the number 5 over a period of time. This is ideal if you expect to lose one of your private keys.
These are the core features that Taproot offers. And almost all developers agree that such features will be widespread, but not immediately.
“I expect Taproot-enabled features to be very widespread when downstream applications integrate them, as they give apps that offer valuable functionality a competitive advantage and reduce costs,” said a Bitcoin developer who requested anonymity.
Other developers agree that we will have to wait for applications, wallets, and protocols to implement Taproot before fully announcing its positive effects. For BTC wallet developer and service BTCPay Server founder Nicolas Dorier, the taproot rollout is unlikely to be as widespread as it is for SegWit, especially for users who only need payments in one signature.
“It will be widely used for other protocols based on Bitcoin (like Lightning). In the chain, Taproot makes the use of these protocols indistinguishable from others. The benefits of multisig from such improvements will certainly follow, but will existing multisig wallets migrate to Taproot? He asked, adding that the answer to this question was still unclear.
“To enjoy privacy, some of the more complex protocols (musig2) need to work,” he said, noting that current multisig wallets may not be worth the effort.
For bitcoin writer / teacher / developer Jimmy Song, the multisig wallet will gradually integrate Taproot, but not immediately.
“Not much at first, but more over time. There is a need for good backup solutions so I think wallets will have them built in, ”he told Cryptonews.com.
How Taproot Could Affect Bitcoin’s Competitiveness
The question is: will integrating Taproot’s capabilities make a real difference to Bitcoin’s value proposition?
“I hope it will appeal to people who really understand the value of security. Altcoin players are interested in token price increases, not autonomy, so I doubt such people will not be too interested in taproot, ”said Jimmy Song, suspecting a bear market.
Nicolas Dorier notes that Taproot isn’t really going to cut fees for the vast majority of Bitcoin users who tend to use wallets and single signature transactions. However, he left open the possibility that acceptance could be expanded in the long term.
“Personally, I don’t think Taproot will attract more people to Bitcoin. Perceived value will come from the protocols that can be built on, and it is difficult to predict if some new popular protocols like Lightning will come out, ”he said.
Dorier also stressed that Taproot won’t have a huge privacy impact in the short or medium term.
“I would say that by the time it becomes widespread for protocols on bitcoin, it could even have a negative impact by making taproot transactions stand out from the crowd. It’s temporary, ”he said.
In other words, it would be naive to believe that Taproot will help Bitcoin lure users away from other coins – including privacy coins like Monero (XMR) – in the months following its release. Instead, it may take even longer for its benefits to impact competition.
How Taproot Could Affect Bitcoin Regulators’ Attitudes
By and large, Taproot is unlikely to take control of regulators or cause those regulators to lower Bitcoin any further.
“I don’t see this getting a lot of attention from governments. Jimmy Song said, “Cross input signature synthesis is possible, but at least it’s another soft fork,” said Jimmy Song.
Nicolas Dorier largely agrees with this assessment, if only because the use of complex wallets is still quite low.
“I don’t expect any action from regulators,” he said. “Those who are trying to protect their privacy with Bitcoin already have many ways to do so, and Taproot’s ability to improve on this is small at best.”
While the immediate impact of Taproot will remain minor, it is without a doubt the most significant Bitcoin upgrade since SegWit. Because in the long run, it will provide Bitcoin users with more security and privacy.
Join our Facebook group and Telegram group Coincu News to chat with more than 10,000 other people and exchange information about the crypto currency market.
Important NOTE: All content on the website is for informational purposes only and does not constitute investment advice. Your money, the choice is yours.
