As Bitcoin moves to all-time highs this week, there’s yet another surprise coming down the pike.
Lyllah Ledesma at Coindesk talks about the “Taproot” Bitcoin upgrade planned for mid-November and what it might do for the blockchain, as well as Bitcoin prices.
“Some investors have grown more skeptical of the Bitcoin network’s ability to adapt and scale, worried that its first-mover advantage might be eroding,” Ledesma writes. “Given the rapid pace of development in the blockchain industry, four years without a major upgrade seems like eons to some.”
As Ledesma points out, Taproot is not new – it was designed in 2018, and has been anticipated for quite a while. So for those who feel that Taproot will replicate the big bounce involved in previous 2017 upgrade technologies like SegWit, Ledesma has some disclaimers:
“The bitcoin price has already doubled this year and hit a new all-time high near $67,000 last week,” Ledesma writes. “While further gains are possible, Taproot alone probably wouldn’t be the catalyst.”
So what’s in this “Taproot?”
One thing that Taproot will add to the blockchain is the capability to include a “Schnoor signature” that is based on discrete logarithm problems. This will enable Bitcoin to empower smart contract handling. That’s a big deal according to some investors, because rival blockchain Ethereum has a lot of this built in, and is widely known as the leader in smart contract cryptocurrency.
Again, though, since Bitcoin has been planning these innovations slowly, they might not get the juice out of the new upgrade that some investors would suspect.
Tracking this event makes a lot of sense for someone with Bitcoin holdings. It’s important to do your own research and determine whether you feel that Taproot is going to make the price bounce or not, and to what degree you would make that prediction. The result will probably affect your portfolio as we move toward the pivotal change in the original Bitcoin blockchain.