BITCOIN JUST GOT A HUGE UPGRADE | Digital Market Guide

BITCOIN JUST GOT A HUGE UPGRADE

 

Bitcoin just got a huge upgrade-it’s called Tap Root, here’s what it means, what it does, and what the price of bitcoin will be as a result.

There are three main upgrades that are in Tap Root. The first is an upgrade to privacy. For The longest time, people believed that using bitcoin meant you could anonymously pay people for stuff, but it turns out bitcoin is pseudo anonymous. That is why the FBI was able to seize money from Darkside.

 

WHO CARES ABOUT PRIVACY?

It matters because right now there are other cryptocurrencies that exist specifically because of one feature that they do better than everyone else for example- Monero which is considered to be the most private and anonymous coin to date. It has a market cap of several billion dollars and now bitcoin will be competing in the future.

 

The second upgrade:

The second upgrade to bitcoin is something called shnorr signatures. Shnorr signatures is what allows the first upgrade to happen, but it’s also got a few tricks up its own sleeve like improving efficiency.

When satochi Nakamoto created bitcoin, he designed it with something called the Elliptic curve Digital signature Algorithm or (ECDSA).

 

UNIQUE DIGITAL SIGNATURE:

Your private key creates the unique digital signature and your public key, which is what you share with someone when you pay or get paid.

 

MEANS WHAT THIS ALL

It’s going to help bitcoin create better smart contracts which are something Ethereum is capable of doing that bitcoin is not really that good at. This is because changing the digital signature structure-it allows bitcoin to create smart contracts that ECDSA cannot or at least nowhere near as efficiently. This is because this new structure shrinks’ multiple transactions into one, you can improve efficiency and cost.

THE LIGHTNING NETWORK

Bitcoin can handle five transactions per second, nowhere near enough for the entire world. Visa can handle 65,000 per second. In order for bitcoin to become a true currency, it has to fast and cheap. How do you create something like that without compromising the base layer of bitcoin? Layer 2 scaling solutions like lightning. This upgrade moves us one step closer to that goal.

WHEN WILL IT HAPPEN?

It will happen sometime in November of 2021.

 

PRICE PREDICTION

What will happen to the price of bitcoin? Most likely- the price will do nothing at least not right away. As developers explore this upgrade more and as they continue developing the lightning network, that will eventually increase the value of bitcoin but the upgrade itself will most likely not have any major effect on the price.

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