March 5, 2024

Taproot: Unlocking the Gateway to a Flourishing Bitcoin Ecosystem

The purpose of the #Bitcoin network's emergence was decentralized trustless currency. The purpose of other blockchain smart contract platforms (including Ethereum) was to solve the scalability of blockchain, or it can be called, to address the scalability issue of #Bitcoin.

Before the Taproot upgrade, all the innovative technologies of these outstanding blockchain smart contract platforms could not be decentralized utilized by #Bitcoin. In other words, before the #Taproot upgrade, #BTC could only function as a decentralized digital currency and could not have an ecosystem, nor could it link blockchain innovation technologies with Bitcoin.

After the Taproot upgrade, #Bitcoin has moved beyond the narrative of only being a decentralized currency and has embraced the narrative of having its own ecosystem, just like all L1s. At this time, our community users also saw that the rise of the #BTC ecosystem came from the #Taproot upgrade more than two years ago.

So, what exactly did the Taproot upgrade bring to Bitcoin?

1. It brought native asset ecosystems on the #Bitcoin network such as BRC20 and Ordinals NFTs.

2. It introduced Taproot addresses starting with bc1p, which most Bitcoin users are already using.

3. It enabled decentralized #Taproot scalability, such as the #BEVM, Bitcoin layer2 scaling solution technology, which is entirely based on Taproot.

4. The Lightning Network saw the emergence of the #Taproot asset protocol.

5. More innovations are on the way...

So, what exactly is Taproot, given its significant impact?

Taproot was first proposed by Bitcoin Core contributor Gregory Maxwell in 2018.

Taproot allows complex transactions (such as multisig and timelocks) to be executed like a single Bitcoin transaction, thereby enhancing Bitcoin's privacy and scalability.

The Taproot upgrade includes three significant technical changes (concepts) to improve Bitcoin's scalability, privacy, and flexibility.

Taproot consists of the following 3 BIPs:

1. BIP341: MAST(Merkleized Abstract Syntax Tree). MAST allows embedding more complex conditions in transactions, but only reveals the conditions satisfied at the time of transaction execution. This feature enhances privacy, reduces the amount of data that needs to be stored on the blockchain, and increases scalability.

2. BIP340: Schnorr Signature. By aggregating signature, it makes Bitcoin threshold signatures as efficient as POS(BFT signatures), thereby enhancing the decentralization and security of #BTC's scalability.

3. IP342: Tapscript

Schnorr signatures (BIP340), Taproot (BIP341), and Tapscript (BIP342) are collectively referred to as BIP Taproot.

Over 15 years of development, Bitcoin's underlying technical framework has undergone a complete transformation, thanks to the #Taproot upgrade two years ago.

When Taproot was proposed in 2018, we realized the benefits of this #taproot BIP upgrade and have been accumulating and exploring directions for #taproot scalability.

Among them, #BEVM, a completely decentralized EVM-compatible Bitcoin L2 solution based on the Taproot upgrade: Taproot Consensus. Taproot Consensus uses a combination of Schnorr + Mast + Bitcoin light nodes to form a decentralized POS network, transforming the security and decentralization of Bitcoin scalability into the security level of a BFT POS mode. This addresses the issue of decentralized scalability for #Bitcoin.

The BEVM team is abstracting this framework into BEVM-stack.

BEVM-stack consists of two main parts.

One part is the Bitcoin layer2 module based on Taproot Consensus, aimed at decentralizing Bitcoin scalability and then linking new blockchain innovation technologies.

The other part is about innovative scalability technologies in blockchain, such as the stable EVM technology ecosystem, the secure #Move ecosystem, the zk-based Cario language ecosystem, and a series of ecosystems that can be plug-and-play with the first part, #Taproot scalability BTClayer2 technology. This allows all blockchain innovation technologies to be utilized by #Bitcoin, while also circulating decentralized currency #BTC across various blockchain innovation technologies. This achieves both the financial value of #BTC's large market capitalization and the technological value of various blockchain innovations.