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Bitcoin’s Privacy Upgrade
CoinDesk’s Christie Hakin: Bitcoin’s most significant improvement in years has won a stamp of approval.
Three years in the making, Taproot works to make it so Bitcoin can be more and greater than it is now. It has the potential to have better usability and more nimble smart contacts.
However, the thing that struck observers the most was the new privacy protocol that utilizes a an added level of obfuscation, which will make mixed and regular BTC transactions look identical on the blockchain.
This is crucial for a number of reasons. BTC is like an open ledger, and it is very simple to track. Bitcoin mixers group transactions together to make it more difficult, but not quite impossible, for a transaction to be traced back to its origin.
Mixers are great tools for both the safety-conscious and for criminals. This means Taproot’s latest upgrade has two sides to it. If you think cryptocurrency should function like regular money, then it’s great. But, paper money doesn’t leave a very good trail as far as digital surveillance is concerned.
Taproot will not be available until November, 2021. This is when BTC is predicted to reach a certain blockchain height. This will give miners and node operators plenty of time to upgrade their software beforehand. Once it’s launched, it will be in the hands of developers to integrate Taproot into products that crypto miners will use.
So, the big question is whether this is going to be a new BTC, or at least an alternative. Aside from this added functionality, Bitcoin will continue to operate as it usually does, which is as an internet-based store of value that hasn’t yet been touched by central bankers.