The required threshold for unlocking the Taproot upgrade, which makes smart contracts for Bitcoin more efficient and secure, has been reached.
In recent weeks, Bitcoin miners have signaled their support for the Taproot upgrade, and on Friday, according to Taproot.watch reached the threshold of 1,815 (or 90 %) taproot signaling blocks.
The Taproot softfork will be the first major upgrade for Bitcoin since the implementation of Segregated Witness( SegWit) in 2017, which increased the block size of the blockchain by removing signature data from Bitcoin transactions.
Taproot was originally proposed in 2018 by Bitcoin Core developer and former Blockstream CTO Gregory Maxwell. The upgrade has now received support from other prominent Bitcoin Core contributors such as Rusty Russel, Pieter Wiulle, Andrew Poelstra and Anthony Towns.
It will extend the flexibility of Bitcoin’s smart contracts while improving data protection.
Bitcoin currently uses the pay-to-script hash (P2SH), with the blockchain initially containing only one hash (a string of numbers and letters) of the script (code that defines how coins can be spent in the next transaction).
This system has its pitfalls, because when the coins are issued, all possible conditions of the script must be revealed – not only those that were actually fulfilled. This means that each hash must contain a lot of data, which in turn has a detrimental effect on privacy.
Taproot works with a solution known as the Merkelised Abstract Syntax Tree (MAST), which uses the data structure of the Merkle tree. This means that each output condition is hashed individually before being included in a Merkle tree, which then produces a single hash called the Merkle root.
Not only is this process more data efficient than P2SH, but it also ensures better data protection because some data can be disclosed for review while the rest of the Merkle tree remains hashed and hidden.
After successful signaling, full nodes are expected to activate the Taproot softfork at block 709,632 in November of this year.