The long-awaited upgrade will improve privacy, efficiency, and programmability.
Key Takeaways
Bitcoin’s Taproot update is expected to occur on Saturday.
The upgrade will improve Bitcoin’s privacy and programmability while making transactions faster and less expensive.
Hype around Taproot may have helped Bitcoin achieve new all-time highs this week.
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Bitcoin’s long-awaited Taproot update will occur in the coming days, with most sources suggesting Saturday as its activation date.
What Is Taproot?
Taproot is an upgrade that will improve Bitcoin’s capacity for scripting, bringing it in line with competing blockchains like Ethereum that already have programmable smart contracts.
Taproot will also introduce MAST (Merkelized Abstract Syntax Tree), which will make it more difficult to trace and analyze Bitcoin transactions. It does so by making complex transactions—such as multi-signature transactions and Lightning Network transactions—indistinguishable from basic transactions.
The upgrade will also include Schnorr signatures, which will create smaller transaction sizes through data aggregation.
Together, these features mean that developers will be able to create more extensive Bitcoin applications, while end-users will be able to benefit from cheaper, more private transactions.
Taproot is Bitcoin’s most significant upgrade since 2017, when the cryptocurrency introduced a controversial new feature called SegWit. The Taproot upgrade is much less likely to cause division.
Upgrade Will Likely Take Place Saturday
Though Taproot already gained support from miners earlier this week, 800 blocks will need to be mined under those conditions before the feature is actually activated.
NiceHash’s countdown suggests that the upgrade will occur at 1:00 UTC on Saturday, Nov. 14. Another countdown website, Taproot.watch concurs with that estimate, suggesting that there are just 339 blocks left to mine at the time of writing.
Anticipation around the upgrade was likely one of the factors driving Bitcoin’s market surge this week. The price of Bitcoin hit all-time highs on Tuesday and Wednesday, reaching a market value of $68,521 and $69,044 on those days respectively.
It remains to be seen whether Saturday’s upgrade will lead to greater highs, or whether the hype around Taproot has been exhausted.
Disclaimer: At the time of writing this author held less than $100 of Bitcoin, Ethereum, and altcoins.
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