Bitcoin Got Its First Update In Four Years – What Is Going to Change
Miners around the world have approved the first Bitcoin update in four years.
An update called Taproot will be activated this November, CNBC reports. It should ensure the privacy and efficiency of transactions at a higher level. Also, the update can open the way for smart contracts, which will allow you to forget about intermediaries in transactions of any complexity.
Stillmark founder Alice Killeen said Taproot will open up great opportunities for entrepreneurs interested in expanding the value of BTC.
Taproot, unlike the previous Bitcoin update in 2017, has almost universal user support because these changes are incremental code improvements.
The new Bitcoin update is about digital signatures, which you can think of as a fingerprint left by any person on every transaction they make.
Right now, cryptocurrency is using the Elliptic Curve Digital Signature Algorithm. It is generated from the private key that controls the bitcoin wallet. Taproot essentially makes multi-signature transactions unreadable.
This will not lead to a better anonymity for your individual Bitcoin address on the public blockchain, but it will make simple transactions indistinguishable from more complex and multi-signature transactions. This “amplified signature” can change the game for smart contracts, which are self-executing agreements stored on the blockchain.
The Taproot update makes smart contracts cheaper and smaller in terms of blockchain space.