What is a Taproot?

The meaning of Taproot is that it's a proposed upgrade to the Bitcoin blockchain. It seeks to improve Bitcoin's scalability, privacy and smart contract capabilities. The upgrade will make it easier for users to create sophisticated contracts without having to rely on third-party intermediaries or specialized software. Taproot also improves the privacy of Bitcoin transactions by enabling users to create more complex multi-signature scripts that are less visible on the blockchain. This increases the privacy of both sender and receiver in a transaction. The upgrade also makes it possible for miners and full node operators to enjoy better cost savings as they process more efficient transactions with fewer resources. In addition, Taproot could help reduce blockchain bloat, making the entire system lighter and faster while improving overall security. Ultimately, with its improved scalability, privacy and versatility, Taproot promises to make Bitcoin more efficient, secure and accessible. With these benefits in mind, many industry experts are optimistic that the upgrade will be successful.

In order to ensure a smooth transition to Taproot, work is being done by developers to create backward compatibility with legacy software. This means that users of older versions of Bitcoin software won't need to worry about upgrading or having their transactions rejected by the network. In addition, all existing scripts on Bitcoin can be used on Taproot's upgraded blockchain without any changes required to them. Furthermore, as part of its effort towards making the rollout go smoothly, major wallets and exchanges are beginning to announce their support for Taproot ahead of its launch.

By leveraging the power of Bitcoin and its underlying technology, Taproot has the potential to significantly improve the user experience. It can make complex transactions easier, more secure and more private while simultaneously providing additional cost savings for miners and full node operators. With this in mind, it is likely that Taproot will be an incredibly valuable upgrade to the Bitcoin blockchain. In the end, it could pave the way for even more powerful uses of Bitcoin in the future.

Simplified Example

Taproot is like a big tree with many branches. Each branch represents a different way to use a blockchain, just like how a tree has many branches for different kinds of leaves and fruits. Taproot makes it so that all of the branches look the same on the outside, but on the inside, they can be used for different things. This makes the blockchain more private and efficient, because it's harder for people to tell what's happening on the different branches.

Who Invented the Taproot?

The term "taproot" within the crypto context originated from a proposal by Gregory Maxwell, a prominent Bitcoin developer, in 2018. Maxwell's proposal aimed to overcome limitations in Bitcoin's transaction structure, particularly in privacy and efficiency. "Taproot" was selected to symbolize the upgrade as a fundamental improvement to the Bitcoin protocol, akin to a "root cause" solution.

This proposal initiated a collaborative effort among Bitcoin developers to refine the Taproot concept. Multiple Bitcoin Improvement Proposals (BIPs) were formulated to formalize the technical specifications of the upgrade, with key contributors including Pieter Wuille, Jonas Nick, Tim Ruffing, and AJ Townes.


Multi-Signature: In traditional bitcoin transactions, multiple signatures are required from multiple parties to unlock funds. With Taproot, this process can be simplified into a single transaction, making the process more efficient and private.

Timelock: Timelock allows funds to be locked for a certain period of time before they can be spent. In traditional bitcoin, this process requires multiple transactions. With Taproot, this feature can be condensed into a single transaction, improving the overall efficiency and privacy of the process.

Smart Contracts: Taproot allows for more complex smart contract functionality to be implemented on the blockchain. This can be used for a variety of purposes, such as escrow services, token issuance, and more, without sacrificing privacy and efficiency. These complex features can now appear as a single transaction on the blockchain, rather than a series of transactions.

  • Blockchain: A decentralized, digital ledger that records transactions across a network of computers.

  • Bitcoin Improvement Proposal: A design document that outlines proposed changes to the Bitcoin network.