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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.