Bitcoin’s New Privacy Tech Requires Schnorr Update
There are a number of reasons why Bitcoin gets criticized. One of the problems with bitcoin is that it is hard to be private with transactions on the network.
The public ledger technology of the blockchain allows just about anyone to look up any transaction on the network starting from the beginning. Bitcoin developers have been trying their best to cover this seeming hole for a long time now.
The most promising solution was unveiled in January by Greg Maxwell which he labeled as “Taproot“. The way it works is instead of stopping outsiders from viewing transaction information; the technology can make all the transactions on the network look the same.
Taproot caused a lot of buzz when it first came on to the scene, but the excitement has dropped considerably in recent times as other developments in the bitcoin industry have come up. However, there are quite a few developers who are toiling hard to make Taproot a reality.
The two most notable contributions that have propelled Taproot forward are when Andrew Poelstra released a mathematical proof on how the technique could work and when Anthony Towns released a potential method on how to reduce the data footprint of the technique.
According to Towns, Taproot is simple enough that it could be implemented directly – except that it needs Schnorr to be fully effective. The reason why Schnorr is essential is that it updates bitcoin's current signature scheme. The main feature that it contributes is that it allows signature data to be mashed together. It is harder to interpret the data this way and goes hand-in-hand with Taproot's goal of making every transaction look the same.
Schnorr On The Way
The trouble is that Schnorr is just now taking its baby steps in development. Many developers think it will be the next significant change in bitcoin. Pieter Wuille, the co-founder of Blockstream recently released a technical proposal of how to implement Schnorr.
SF Bitcoin Developers
With the idea of Schnorr slowly becoming a reality, several developers are already envisioning what they can do with the technology. Taproot is just one of the important changes that Schnorr will allow for. Some developers think that Taproot will be part of the bundle of upgrades that will be rolled out when Schnorr is finally active. This includes a way to boost bitcoin smart contracts and to increase the reliability of the bitcoin lightning network.
With all of the potential changes that Schnorr can bring to the table, developers think that the main challenge will be to decide on which developments should be focused on first. For Taproot though, some developers have been advocating deploying it and Schnorr simultaneously. However, the timeline for implementation is still hazy with developers thinking it will take longer than expected.
Kate is market industry expert who has spent majority of her life on wall street, she has thought to have a knack at picking the right stocks to invest into. With the rise in cryptocurrencies she has is now able to use her expertise to a new market and give us insights on what we can expect in the present and the future.