Bitcoin, the world’s most popular cryptocurrency, has got its long-awaited upgrade, with focus on improving the network's privacy and security.
As explained by The Block (via Engadget), Taproot, which went live on November 14, uses an enhanced form of signatures for transactions called Schnorr.
The new signatures make complicated, multi-signature transactions appear as normal, making it look like any other transaction. This makes it difficult for snoopers or would-be hackers to trace larger transactions or unusual ones.
Besides security and privacy, Schnorr signatures also improve efficiency.
According to a report by River, bitcoin relies on digital signatures to transfer currency on the blockchain. These signatures act as proof of ownership.
Typically, a signature is made up of a public key, message and signature. The public key is then linked to the signature for ownership.
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In cases where are three or more public keys trying to sign the same message, the verification checks have to be repeated for all three keys and signatures. This reduces efficiency as verification can be computationally expensive.
Schnorr signatures make it possible to combine the three public keys into one, thereby reducing computational costs.
For now, bitcoin will use both Taproot and Elliptic Curve Digital Signature Algorithm (ECDSA) transactions.
As to why bitcoin took so long to move to Schnorr signatures, they were protected by copyrights and patents since 1990.
The patent expired in 2008, around the time of bitcoin's inception but it was decided the signatures lacked popularity and the testing required for critical system.
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