Taproot is an upgrade to the Bitcoin network that increases its scalability and privacy. Less fees for complex transactions, more network flexibility, and increased Lightning network performance are other benefits of this upgrade.
to the the report CoinDesk The most important consequence of the Tap Root update is that it reminds us that Bitcoin is a technology.
You may have seen the green squares floating around Twitter. Like laser eyes, they are part of the signals that create a sense of causation and belonging. But unlike laser eyes, they are not directly related to price and express their support for Tap Root updates for the Bitcoin network.
But why is this important? The importance of updating is not just because of its benefits. Tap Root is important because it reminds us of what Bitcoin is. Before we look at the reasons for this importance, let’s look at the main benefits of this update.
1- Increasing privacy: This issue is not related to bitcoin addresses or anonymity; Rather, it refers to the types of transactions. Tap Root distinguishes complex transactions, including those that require multiple signatures or those with delayed release, from simple transactions in terms of indistinguishable chains.
2. Lower fees: The data volume of complex bitcoin transactions will be reduced, which will reduce transaction costs.
3- More flexibility: There is a new type of signature that improves the performance of smart contracts in Bitcoin and makes creating more complex conditions for a transaction easier and cheaper for users.
4- Enhance Lightning: Tap Root makes Lightning network transactions cheaper, more flexible and more private. The Lightning Network is a second-tier solution that enables faster and more scalable payments that are periodically accumulated in the Bitcoin blockchain. It also increases the security of Bitcoin while enhancing its speed and operational capacity.
With all of the above in mind, Tap Root is the most important bitcoin network upgrade since blockchain size increased in 2017. The relatively low number of updates to Bitcoin highlights one of its most important features; Bitcoin is powerful.
It is difficult to make any changes to Bitcoin. No one is responsible for deciding what changes will take place, and reaching an agreement among these diverse and scattered groups of participants is at least a challenge. The relative support for Tap Root indicates that this update is an important issue.
However, what has been controversial in this regard is the method of updating. In March, an agreement was reached in the form of an experiment called Speedy Trial, which gives miners a set of blocks to declare support for Tap Root within two weeks.
This event started last Saturday at the same time as the latest network correction. From that moment until the next network correction (two weeks later), Bitcoin miners announce their support for upgrading Tap Root in their extracted blocks. If 90% of the processed blocks declare their support, this update will be activated in November.
However, on Tuesday it seemed that this round of support for Tap Root was not successful. Approximately 25% of the blocks processed by mid-day indicated that about 20% did not support the update, so the 90% threshold was not reached.
This does not pose much of a problem. Instead of rejecting this idea, it is possible that the miners have not yet focused on the issue or that their software is being modified for the necessary steps. There is a two-week opportunity to announce support, and if this is not successful, the network will try again and will continue to do so until August 11. If 90% of the support is not met by that date, planning for it will start all over again.
Tap Root Update enhances the performance of Bitcoin and expands its market. This is a good thing for the landscape and its value.
But here is the most important consequence for the investment market: it reminds us that bitcoin is a technology.
Many investors see bitcoin as a reserve of value, others are affected by its volatility. But most of them ignore one of its most characteristic features. Bitcoin, with all its positive aspects, is a relatively new technology.
When you buy gold, you are not surprised how it evolves in the safe. Bitcoin, on the other hand, is evolving. Bitcoin did this in 2017 and will probably do so again this year.
Technology comes with risks. Things may get a little complicated. Codes have bugs or unintended consequences; This is why the number of bitcoin updates is small and long distance, because they must be carefully reviewed and tested. Also, since there is no central body for deciding on Bitcoin updates, network subscribers have to agree on it, and it is always very difficult to reach a consensus.
The market value of Bitcoin has now reached more than $ 1 trillion, and that is a good thing. There is also the evaluation of businesses created to support the Bitcoin network, so the risk should be reduced to a small level.
Tap Root turns Bitcoin into a great value store and provides good returns for speculators. But on the other hand, digital currency is an opportunity to invest in an evolving technology. Just like participating in a startup, but with more cash and less paperwork.
Tap Root not only improves the usability of Bitcoin and can influence market development and value, but also reminds us of one of the key features of Bitcoin that seems to be immersed in the prevailing market-driven narratives. Bitcoin is still a new technology, and its positive and potential aspects go beyond its release schedule, resistance to inflation, and decentralization.