Last update happened on bitcoin network was on 2017. Now in November, 2021 another game changing upgrade called Taproot Upgrade is coming.
Bitcoin's makeover has to do with digital signatures, which you can think of as the fingerprint an individual leaves on every transaction they make.
Right now, the cryptocurrency uses something called the "Elliptic Curve Digital Signature Algorithm," which is created from the private key which controls a bitcoin wallet and ensures that bitcoin can only be spent by the rightful owner. Taproot will switch over to something known as Schnorr signatures, which essentially makes multi-signature transactions unreadable, according to Alejandro De La Torre, vice president at Hong Kong-headquartered major mining pool Poolin.
In practice, that means greater privacy, because your keys won't have as much exposure on the chain. "You can kind of hide who you are a little bit better, which is good," said Brandon Arvanaghi, previously a security engineer at crypto exchange Gemini.
It won't translate to greater anonymity for your individual bitcoin address on the public blockchain, but it will make simple transactions indistinguishable from those that are more complex and comprised of multiple signatures.
These souped-up signatures are also a game changer for smart contracts, which are self-executing agreements that live on the blockchain. Smart contracts can theoretically be used for practically any kind of transaction, from paying your rent each month, to registering your vehicle.
Taproot makes smart contracts cheaper and smaller, in terms of the space they take up on the blockchain. Killeen says that this enhanced functionality and efficiency presents "mind blowing potential."