The first bitcoin upgrade in four years, Taproot has been approved by the miners. It will give greater transaction privacy & efficiency. It has a key feature that eliminates middlemen from the most complex transactions. Bitcoin’s makeover is related to digital signatures which act as a fingerprint of an individual of every transaction they make. The cryptocurrency uses the “Elliptic Curve Digital Signature Algorithm” which is created from the private key that controls a bitcoin wallet to ensure that bitcoin be spent by the rightful owner.
According to Alejandro De La Torre, vice president at Hong Kong-headquartered major mining pool Poolin, Taproot is similar to Schnorr signatures, which makes multi-signature transactions unreadable.” This means greater privacy which will not expose you much on the chain.
This will make simple transactions indistinguishable from complex transactions or the one containing multiple signatures. Taproot makes smart contracts smaller & cheaper. Smart contracts help one in building up applications & businesses on the blockchain. The upgrade processes have to be tested very carefully owing to the possibility of a bug entering the system.