Bitcoin gets closer to an improved scalability future after merging code for Schnorr signatures and Taproot for Bitcoin Core as the leading cryptocurrency will pave the way for private and fast transactions. In our latest bitcoin news today, we are reading more about it.
The codebase for schnorr signatures and Taproot technologies were merged into Bitcoin Core and the new technologies will enable cheap and private transactions which could further benefit other technologies like the Lightning Network. Bitcoin core is quite conservative and prioritizes simplicity and security over the other features which don’t mean the network is the same as it was in 2009.
After the release of the SegWit (Segregated Witness) in 2017, it was revealed that this week Bitcoin gets closer to scalability after the two major upgrades on the horizon since Schnorr signatures and Taproot will offer the premier crypto network improved privacy and scalability. Understanding the benefits of the Schnorr signatures requires quite a bit of knowledge about what digital signatures are and how it is used in BTC.
The digital signature is like using a fingerprint to access the data on the blockchain or similar to a Touch ID. If you want to control your own phone, you will have to prove it’s you so you should place your finger over the sensor for verification. Once you create a crypto wallet, you will receive a private and a public key to the private key will be the fingerprint and the public key will be the phone. You can use the private key to authorize the outgoing operations from the wallet which is called signing.
Right now, the algorithm used for signing is the Elliptic Curve digital signature algorithm as the mechanism was used because Schnorr signatures were still under patent and it is not available until 2008. ECDSA provides similar functionality to the Schnorr signatures but it’s inferior as these signatures are more secure and can enable better privacy and save space on the chain. Now that this new signing mechanism comes to Bitcoin, the entire network will enjoy a minimum of 15% improvement in space efficiency.
If you received BTC from multiple addresses, and you want to spend them in one transaction, ECDSA will require you to sign each one you received. With the Schnorr signatures, you will bundle these transactions into one single operation. Having one signature to replace others will reduce transaction costs because you will occupy less space in the block. Another benefit of the Schnorr signature is privacy since you can create a signature that will cover the users’ inputs and will make a joint transaction. An outside observer will not be able to see how many people signed the transaction.
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Stefan has been writing articles for DCForecasts since 2016 in-house full time. As one of our main cryptocurrency writers, he focuses on covering the latest cryptocurrency news, technical charts, price analyses of coins and press releases. When he is not exploring and covering the latest topics in crypto, you can find Stefan playing basketball, tennis or cycling.
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