11/22/2021 | Press release | Distributed by Public on 11/22/2021 13:37
On block 709632 (that is, Saturday November 13 at 9.15pm UTC), Taproot was made active on the Bitcoin blockchain. It is Bitcoin's first major upgrade since Segwit in 2017. 90% of the miners approved of this upgrade which will bring better efficiency and security to the Bitcoin network.
Taproot has these three features:
So, how is this good for Bitcoin? The viability of Bitcoin as a public good hinges on its affordability, privacy and usefulness. Taproot meets those challenges to its viability. Taproot's smart contracts capability will bring DeFi to Bitcoin.
Meanwhile, what does the Taproot implementation mean for Lightning? Taproot executes smart contracts on-chain, whereas Lightning's smart contracts are off-chain. But the area where Taproot helps Lightning is through the Schnorr signatures. The Schnorr signatures make it possible for Lightning to upgrade its own smart contracts. Most importantly, these signatures will provide improved privacy for the opening of Lightning channels.
This is a major boost for Bitcoin the network. However, Taproot is not a silver bullet and this upgrade is only the start of a new round of projects for Bitcoin that will build on the Taproot implementation. Investors should see Taproot as the opening of a new chapter for Bitcoin that will create a virtuous circle for Lightning and LQwD FinTech.