Glossary

Taproot

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Taproot is currently a proposed upgrade to Bitcoin which would introduce several new features. The Taproot upgrade is described in BIPs 340, 341, and 342, and introduces the Schnorr signature scheme, Taproot, and Tapscript. Together, these upgrades introduce new, more efficient, flexible, and private ways of transferring bitcoin.

The Schnorr signature scheme is more efficient, secure, and quicker to verify than Bitcoin’s original digital signature scheme, ECDSA. Additionally, Schnorr signatures enable MuSig, a more efficient form of multisignature which would greatly increase the privacy and fee rate paid by multisig transactions.

Taproot will enable sending to and spending from Schnorr public keys as well as enabling bitcoin to be sent to multiple scripts at once. In order to achieve this, a new type of ScriptPubKey called Pay-to-Taproot (P2TR) will be defined. The addresses for these scripts will use SegWit v1 and Bech32 encoding.

Related Terms
Schnorr Signature
Schnorr is a type of digital signature scheme similar to the ECDSA scheme. The Schnorr scheme presents several security, privacy, and efficiency advantages over ECDSA.
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MuSig
MuSig is a protocol for creating Taproot multisig public keys and signatures. MuSig makes use of Schnorr signature and public key aggregation
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Tapscript
Tapscript is the scripting language used to enable a variety of new transaction types as part of the Taproot upgrade. Tapscript takes advantage of Schnorr signature aggregation.
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SegWit
Segregated Witness (SegWit) is a soft-fork upgrade to Bitcoin which was activated in 2017. SegWit fixed the problem of transaction malleability, and paved the way for the implementation of the Lightning Network and many other upgrades.
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ECDSA
Elliptic Curve Digital Signature Algorithm or ECDSA is a cryptographic scheme for producing digital signatures using public and private keys.
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