Taproot

Definition

Taproot is Bitcoin's most significant upgrade since SegWit, activated in November 2021. It implements BIPs 340, 341, and 342. Its main improvements are Schnorr signatures (more efficient and composable than ECDSA), MAST (Merkelized Alternative Script Trees, enabling more private complex contracts), and Tapscript. In practice, Taproot makes multi-sig transactions indistinguishable from simple ones, improving privacy, and enables more sophisticated smart contracts on Bitcoin.