The recent price of bitcoin at the time of writing this article is $64,122, which is very high compared to the previous price, but the cost of bitcoin on 8 November touched $67,585 highest stake of the bitcoin. After reaching the price of bitcoin at this rate, people started buying bitcoin, and now there are more than millions of bitcoin users are using bitcoin for multiple purposes. Bitcoin is a very popular cryptocurrency worldwide, but limitations include privacy problems, security problems, and not being entirely decentralized. There are a lot of other altcoins that are taking advantage of these limitations. In addition, some people do not use bitcoin for their transactions; instead, they invest in bitcoins, and Ethereum is one of the best coins after bitcoin that people are investing in this coin. So, if there are a lot of bitcoin features, there are also limitations of bitcoin. To remove these bitcoin limitations, expectations that the taproot upgrade will change the bitcoin system entirely this month. So, let’s take a brief look at the taproot upgrade in November 2021.
There are a lot of votes of miners all around the world for taproot up-gradation, and more than ninety per cent of votes goes to taproot up-gradation. So, there is an expectation that the taproot up-gradation to bitcoin will apply in November. Know about cryptocurrency risk factors for more learning.
What is a taproot upgrade?
There are a lot of bitcoin limitations as features such as the privacy problems, not fully decentralized, public ledger that means anyone can see the bitcoin transactions. Taproot upgrade means up-gradation in bitcoin technology by improving privacy, security, and transaction privacy, which means transactions will occur as peer-to-peer transactions. It will be complicated for people to understand whether it is a single transaction or not multiple transactions. It will use various transactions and multiple signatures to validate the trade that will work on complex algorithms.
Why is there a need for a taproot upgrade?
There are the following reason that taproot up-gradation is mandatory for the bitcoin for the smooth functioning given below: –
- Privacy: If you are a bitcoin user, you know how much privacy is essential in bitcoin, but the blockchain is a public ledger that means anyone around the globe can see every user’s latest and previous transactions. You can also check the bitcoin transactions by visiting the official website of blockchain. The taproot will improve the privacy of bitcoin transactions, and it will be complicated to understand whether the transaction is single or multiple.
- Security: Bitcoin security is paramount because you will never get it back once you lose your bitcoin. Bitcoin claims that it is a decentralized system that means no third parties are involved, but bitcoin is not entirely decentralized. There are a lot of bitcoin exchanges on the internet that are centralized, which means third parties are working behind it. People use bitcoin exchanges for a better trading experience and privacy, but third-party exchanges can get hacked if there is any security bug. The taproot will improve the security of the bitcoin blockchain through additional features.
- Low transactional fees: – The transactional fees are very high, and if you set the low transactional prices, then you are not aware when your transaction will get verified or confirmed by the miners because miners first solve the trade with high costs and after that, low fees transactions. Usually, the bitcoin transaction takes ten minutes to be confirmed by miners, but sometimes you have to wait for hours. If you are a businessman and accept payment in bitcoin, then a lot of people will avoid bitcoin payments because it will take time to transfer, and customers have to pay the additional transaction fees. So, in taproot upgrade, the transaction gets lighter and will use the lower space on the cloud or miner’s computer. Hence, the bitcoin transaction fees will get more bass than the fees we are paying now.
Will the price of bitcoin increase after the upgrade?
Well, not clearly because when a new thing is introduced to the technology, people get excited about it and start buying. Taproot provides many features, and people will start accepting bitcoin, and by increasing the demand, the price will also increase. So, there is no certainty that the price will increase or not, but there are possible chances of growing.
