Bitcoin network welcomes Taproot soft fork upgrade

Between blocks 709,488 and 709,632, the Bitcoin (BTC) network successfully implemented the Taproot soft fork, according to a 90 percent lock-in consensus among miners and mining pools. The achievement marks the first substantial improvement for Bitcoin since August 2017, when the Lightning Network and Segregated Witness, Bitcoin’s key layer-two solutions, were launched (SegWit).

The Taproot patch intends to increase the Bitcoin network’s scripting capabilities and privacy. The soft fork accomplishes this by introducing the Merkelized Abstract Syntax Tree concept (MAST). According to Hampus Sjöberg, a well-known Bitcoin engineer, a Taproot-dedicated website:

Taproot activation, according to Sjöberg, demonstrates that Bitcoin can do network upgrades again, which is critical for the Bitcoin network’s long-term viability. “That, I believe, is the biggest victory,” he continued.

Sjöberg, who is also the creator of the Blixt Wallet Bitcoin Lightning wallet, feels that the Taproot update enables the exploration of off-chain capabilities while without putting undue strain on the Bitcoin network’s nodes.

START TRADING NOW WITH INCREDIBLE LOW TRADING FEES

Sjöberg also feels that MAST can assist improve the privacy of earlier Lightning Network implementations “if the Lightning implementations chose to incorporate Taproot.” At the LN Summit 2021 in Zurich, Switzerland, the developers of the different Lightning Network node implementations gathered only a few weeks ago to examine prospective upgrade paths:

“At the meeting, one of the topics discussed was whether it’s better to upgrade Lightning in incremental steps or as a single package.”

Furthermore, Sjöberg highlighted how, with Taproot for the Lightning Network, payment channels may be rendered indistinguishable from conventional transactions in typical circumstances:

“It’s impossible to identify whether a Taproot transaction is a regular payment or a Lightning channel transaction.” This is critical for Bitcoin’s fungibility and consequently censorship resistance.”

Speedy Trial, a soft fork deployment strategy that needs 90 percent of miners to notify the upgrade’s deployment, is credited with Taproot’s successful activation. “The signaling mechanism operates in periods of 2016 blocks,” Sjöberg explains, “which means that during a 2016 block period, 90 percent, or 1815, of the 2016 blocks must signal for readiness.”

TRADE NOW

The Taproot update does, however, signal the end of Speedy Trial deployments, and future Bitcoin network improvements will need the use of new soft fork deployment mechanisms. “Taproot offers up a whole new universe of possibilities, but the first thing I’d want to see is a “MuSig 2″ transaction,” says the author. Sjöberg offered the following advice to other Bitcoin developers:

“While nothing in Bitcoin should be taken for granted, I personally want to see “Cross-Input Signature Aggregation” as a future soft fork for Bitcoin.”

The Bitcoin network has undergone numerous community-driven hard and soft forks in its nearly 13-year history. While the Taproot upgrade has yet to demonstrate its worth in the long run, the Lightning Network continues to grow.

On Sept. 28, the Lightning Network witnessed a 160 percent increase in the number of nodes in the span of 12 months in addition to seeing a jump of 170 percent in the number of channels since January 2021.

As of Nov. 11, Bitcoin’s network capacity prior to Taproot soft fork was at an all-time high of 3,220 BTC, nearly worth $210 million.