Bitcoin Taproot potential impact and price predictions

bitcoin_taproot_potential_impact

In the past, Bitcoin has faced criticism for its lack of privacy, high transaction fees, and slow confirmation times. Taproot could address all three of these issues, while also creating a more robust and decentralized system. What’s even better is that Taproot does not require any changes to the Bitcoin protocol, and it could be implemented by way of a soft fork.

Bitcoin Taproot is an innovative solution to many of Bitcoin’s problems. It increases privacy by giving users control over which transaction inputs get spent, it reduces fees since Taproot transactions are not as large, and it reduces the time needed for confirmations by using a probabilistic confirmation scheme.

What economic and financial impact would Taproot have on the crypto market till the end of 2022 and how the bitcoin price will be affected?

Let's dive into audience insights that would probably help you with your research.

Sean Larkin - Traditional, Blockchain and Crypto CFO - Member of MMBA

If you combine the rollout of Taproot in November of 2021 with bitcoins location within its' market cycle, we could see a uniquely bullish 2022 (at least early on). There is no denying what the 'visions of defi' did for the Ethereum price during the first legs of this bull run. Now, we will get to see what that looks like within the massive bitcoin market. Taproot will lead to both the (long deserved) adoption of the Lightning Network, a 2nd layer btc payments solution), and also the adoption of, bitcoin native, defi solutions. With those two developments in mind, I am not going out on a limb to suggest this could lead to significant hype, development, and price appreciation of btc.

Frederico de Abreu - Research and Development

If all goes according to schedule, in the third Quarter of 2021, a new light will start to shine on Bitcoin and its Blockchain, with the Taproot soft-fork that will enable Smart-Contract capability and a bigger privacy based set of rules. The Schnorr signatures will allow for a more concealable way of transacting, in which a single user will be indistinguishable from a group of users. Allowing this way for a Complex Bitcoin transaction, that contain multiple key to be arranged in to a single Schnorr signature, that will reduce considerably the amount of data transferred and stored in the Blockchain. Another key aspect is the removal of Malleable signatures. Once a transaction is signed, it can not be removed or changed, even if the transaction is still undergoing confirmation time. The Smart-Contract is the way that Bitcoin will continue to maintain adaptability and dominance in a market it first served as foundation stone. Making the way clear, for a number of institutions that hold Bitcoin in their portfolio, to deploy their services to an ever-growing range of adopters of the cryptocurrency. Overall, Bitcoin will benefit in full as the new set of rules will bring a better utility for the Blockchain itself, other than transacting cryptocurrency on a P2P base. Sources: https://bitcointaproot.cc/ https://www.nasdaq.com/articles/taproot-activation-brings-massive-upgrades-to-bitcoin-2021-06-12 https://academy.binance.com/en/articles/what-is-taproot-and-how-it-will-benefit-bitcoin https://www.cnbc.com/2021/06/12/bitcoin-taproot-upgrade-what-it-means.html

Olagbadun Olatunde - Cryptocurrencies Trader, Revain Author

Many are interested in the potential of Decentralised Finance. With Bitcoin getting on the bandwagon, we can expect a positive outlook for the major crypto of the market. Lower fees, popularity of BTC and more privacy would be more reasons why anyone will choose Bitcoin Taproot development over any other Defi Protocol in the crypto verse currently.

Bhijan Neupane - Full Stack Developer

First of all, a major upgrade of the Bitcoin blockchain was done four years back. Now, the Bitcoin Taproot upgrade is highly anticipated and expected to come into existence from coming November. Most of the Bitcoin miners agree to support this upgrade; hence, the consensus has been already achieved as it is the first and biggest public blockchain network. Taproot upgrade has two important points to consider: 1)This upgrade will enable better privacy and transparency in transaction 2) For the first time, the Bitcoin blockchain will be supporting the smart contract feature after this upgrade It is expected, Taproot upgrade will allow users to use the smart contract feature cheaply and effectively in the Bitcoin blockchain network and that will inspire them to implement the real-world applications into the Bitcoin blockchain network. IMHO, it will impact the price of Bitcoin and the crypto world due to the following reasons: 1)If use-cases of Bitcoin increase, its demands will also get increased, and hence, the price of BTC will also increase. 2)Taproot upgrade will get adopted by mainstream finance that will inspire mass adoption. 3)Transaction cost will be lowered due to the reduced data size of BTC transaction 4)More flexibility in the Bitcoin blockchain network.

Tony Kunz - Founder | Innovator | Advisor | Decentralized Business Consultant

Taproot will be a very impactful change to the Bitcoin ecosystem especially because till now many Bitcoin folk have been content with the primary application of exchange of value. By making the Bitcoin Blockchain support smart contracts natively and given the massive uptake the exciting possibility is the ready market for smart contract services, however the token limit of 21 million becomes something to pay attention to as with smart contracts the volume of transactions will go up exponentially impacting transaction fees. it is not inconceivable Bitcoin may have to transition away from it's current PoW model and possibly it's 21 million limit. However this will bring more interesting challenges as hardliners have been adamant that that limit be retained.

Fredrich Eb - Blockchain and Crypto Project Consulting

Taproot is the real deal as far as upgrade to the Bitcoin blockchain is concerned. The vastly improved versatility of the programability of its transactions will go a long way to cement confidence in it both as a Store of Value and as a Currency. When properly implemented by end users, the upgrade can make it impossible for hackers to steal bitcoin even if they succeed in hacking a site where it's stored. This is because the transaction may have been coded to move only when a certain precondition is fulfilled. A precondition the hackers won't be able to see because, again, those details have been obscured by the new privacy feature. You can't hack what you can't see. This renewed confidence is bound to resonate throughout the DeFi and CeFi world world, and will in turn attract more investments even from the staunchest doubters out there. Given this certain influx of fresh investments into bitcoin and, by proxy cryptocurrencies, their lives will surely receive a boost in 2022.

Tobi Micheal Olaitan - Manager

I really can't estimate to what extent Tap Root will affect the price of BTC but I am very certain it will benefit all and bring more DEX into embracing and offering BTC trading pairs. Majorly, most DEX traders including me are pissed off with BTC transaction fees and the transaction time frame it takes. Therefore, if Tap Root is fully implemented, more trade pairs and other platforms such as games and financial apps will emerge and thereby make BTC to be sought for the more and definitely spike the price. It will enhance the speed in e-transactions for country like El-Salvador which has made it a legal tender. It is welcome idea.

prof Tochy - Crypto Analyst

With the features the taproot integration comes with i can say, will be of a great improvement to the economic and financial sector of the crypto world because, as more confidence is created the more purchases are made which we know will lead to growth. By making bitcoin transactions less costly too will lead to more and bulk purchases which will definitely be of a positive impact on price.

Henry Bill - Trader

Hi It's my idea. BTC is the King of crypto world. So any upgrade or small change will affect to BTC price and altcoin price. BTC is old. And have many problem as slow transaction and high fee. Sometime users still getting error on code of BTC. With new upgrade on Taproot, we look forward to BTC great again. It will help help improve Bitcoin's scripts to increase privacy and improve other factors related to complex transactions. Without Taproot, anyone can detect transactions using that complex functionality, which requires creating multiple transactions. However, the Taproot upgrade will help "hide" all the moving parts of a Bitcoin transaction including these features. So even if a transaction applies that feature, they will be the same as a single transaction. This is considered a big win for Bitcoin privacy advocates. That make BTC special and unique, help BTC price go grow in three year next. Many expert believe it. And when BTC price increase Altcoin will have more benefit. Many financial institutions will be interested and invest in crypto world. So We can totally count on next spring of Crypto world. Thanks all .

Lance Brady - Analyst

In my opinion I think the impact it'll have will cause alot of panic but it will also drive "mainstream" users to get more involved in blockchain technology. It will also raise more awareness that bitcoin isnt just a stock. That it is an actual technology with an actual function. So to sum up I say that the overall impact will be highly beneficial to blockchain technology and it will bring alot more younger minds to start learning more about blockchain and will hopefully give the blockchain world some very exceptional new developers and thats exactly what we need In these unpredictable times. After the initial panic dies down people will eventually feel more secure and comfortable. We have to remember blockchain is new to mainstream. It will get worse before it gets better. Thats ok though we can handle it.

Karthikeyan Ramachandran - Business Analyst /Blockchain Enthusiast

Taproot was first proposed by Gregory Maxwell of Blockstream and how schnorr MAST and taproot are interconnected is technically explained in the article https://bitcoinmagazine.com/technical/taproot-coming-what-it-and-how-it-will-benefit-bitcoin In short, Taproot helps in reducing the size of the Bitcoins transaction thereby helps with more transactions per block which mean increased TPS and decreased fees. Also once Taproot is enabled, the size of a multiparty transaction would be the same as normal transactions, it will allow the smart contract functionality to get developed on the Bitcoin network. So what would be the economic or financial impact? The simple answer is huge. The current usage of Bitcoin in DEFI is negligible. Even USDT issued in Omni protocol has fallen behind the USDT issuance on ETH and TRX. With multiple Uniswap variants getting developed ETH, BSC has pushed bitcoin to a side actor in DEFI field. So Taproot functionality can unblock the Bitcoin Usage and helps in DEX and DEFI apps getting created on the Bitcoin network itself . We need to note that wBTC issued in ETH itself worth 6B in market cap. Lightning Network can act as the second layer as how Polygon is helping Ethereum in reducing fees and block congestion. So the DEFI can shift towards Bitcoin, being the leading cryptocurrency in market cap and held by the most crypto believers, once Taproot and Graftroot are completely implemented.

Juan Diego Gomez Peña - UX Researcher and Designer

Despite the dip of the moment I always see things optimistically, so beyond the FUD generated by China or Iran or any other in recent weeks, I see a green year-end and why not, new ATHs. Right now my position is: “Oh look, bitcoin at half price”, so I only keep buying because I am certain that in the long term it will continue to climb. Not only because of the Taproot effect but also because of the domino effect that El Salvador's leap of faith will produce in the medium term. One particular detail that I would like to highlight with all these new concepts emerging is that the learning curve of this world is quite steep and requires a significant investment of time to digest the basics, so I like to think about the price and Parabolic volatility of bitcoin as cycles of new bitcoiners entering the game. It will not be the last time that the price of bitcoin falls, but we have not reached an average price either and there is a long time to go.

Hussein Hashish - Supply chain consultant and Blockchain academic

As much as this technical upgrade should bring so much more value in Bitcoin's thesis, unfortunately, the new privacy features will just feed into the narrative that cryptocurrencies & especially Bitcoin is used for illegal activities and ransomware. This will in no way directly affect Bitcoin's price in anyway and might actually cause even more FUD.

Athanasios Sarigiannidis - chem. engineer,trader,investor

my opinion on this subject comes based on the time an only. that is the case because Taproot as an upgrade was inevitable. the proposal has only to bring positive things in BTC ledger but the timing is not right. we are on the cusp of institutionalization and actually making the world understand how secure BTC is and that it's ultimate purpose is decentralization and secure transactions on a public ledger. this is not a time for Taproot. Taproot's upgrade privacy attributes should come only as a layer 2 solution in my opinion and it should come later on BTC existence. the tokenomics of Taproot pointing towards the up side ofcourse and it s another step towards making BTC money because as for not BTC is that slow hard wealth storage with no functional smart contracts. all that will change soon before 2022 Q1 in my opinion. is the time right? my opinion is no. in blockchain we trust.

Fatai-Ayoade Lateef Adekunle - Electrical Engineer. Trading & Poultry.

As per Taproot tech on Bitcoin lack of privacy and other related shortcomings, like long duration of confirming a block transaction, while Ethereum ERC 2.0 can process many transactions per second, will make Bitcoin and other well- valued & strong tech- backed altcoins sit-up to start improving on efficiency, effectiveness, wide-acceptability, convenience and flexibility without compromising security and transaction cost reduction without compromising quality & so on. It seems era of total and global full-adoption of Cryptos is here already while governments & Central banks & other financial institutions ( that are usually conservative/sceptical of drastic change) worldwide are now considering. adopting digital currencies, while these fully realized and functional coupled with era. advanced. technologies & ICTs we are in, will all making ease of doing business & means of payment seamless & more easier & faster, therefore Taproot & the likes, will continuously making greater impact economically & financially even beyond. 2022 and. forever till eternity. For the future of any crypto(s), especially, Bitcoin is quite not fully predictable to precision, but always was, is & will forever being guessed/guessing. Bye for now, until then,. Thanks in advance. Latnovator.

Ale Limón - ingenieer

By reducing the amount of data that will be transferred and stored on the blockchain, the information will be more compressed, therefore improving the efficiency of the ecosystem. This will result in a higher transaction rate per block, which will ultimately lead to lower transaction rates. And by improving privacy, it will increase investor confidence, increasing demand and at the same time causing an increase in the price of BTC once the update is implemented.

Offelia Ogg - day trading, investment, crypto enthusiast

Love Bitcoin! It’s only one truly decentralized crypto. And such metamorphosis as taproot will give birth a new era in crypto world like caterpillar that becomes a butterfly. The price definitely will increase and may be at least 100,000 usdt. I see only positive impact.

Elisée Yao - cryptopreneur

Bitcoin Taproot is a special fork that will reform Bitcoin script and enhance privacy.Taproot builds on the SegWit upgrade to improve Bitcoin's lower transaction fees which is the best thing for a wider for bitcoin audience. It will spread good news in crypo community which will ban discrimination among poor and rich investors.Lower transactions will open the door to all classes of cryptosociety.Bitcoin wont be reserved to elites alone and that will boost its prices alot because of the demand which is actually limited.Thanks

R F - Engineer

Taproot and Schnorr signatures won't solve all the problems Bitcoin has, but it's a big advance to mitigate some of them: enhanced privacy, increase throughput and decrease gas fee since data are reduced and then a bigger amount of transactions per block can be stored and mitigate malleability. This means Bitcoin will see enhance user data privacy, secure transactions and scale the network. As a consequence, the potencial use of bitcoin will be increased significantly. But this won't be translate to an increase of BTC price in 2022. And this is because Bitcoin and, in general, crypto world, will be affected by the Tapering process Central Banks are going to implement during the end of this year (it has already started) and next year. It is true that if potencial use is increased, the future downtrend for Bitcoin can be mitigated, but not reversed.

Jignesh Beladiya - Software Engineer

With Taproot upgrade, Bitcoin has the potential to elevate itself and integrate with mainstream finance. When you buy gold, you don’t wonder how it will evolve while in the vault. On the other hand, Bitcoin does evolve. It did so in 2017, and it will most likely do the same again this year.

Mirb Investments - Crypto Currency Specialist,Analyst

Taproot opens a breadth of opportunity for entrepreneurs interested in expanding bitcoin's utility also Taproot is very essential as it will speed up and reduce the cost of transactions. I think the price of BTC will continue to grow at a similar rate without much influence from Taproot but Taproot will validate and extend the first position of Bitcoin for a longer period of time even though the competition made very good moves but BTC + Taproot is a wonderful move.Taproot will contribute and justify great utility for other existing quality cryptocurrencies and of course a huge number of quality crypto projects will be created based on Taproot.

Lester Liwag - Seafarer

The economic and financial impact would Taproot have on the crypto world till the end of 2022 is maybe having equality of the value of the crypto which may open more blockchain project as well as the nft and blockchain games. And the BTC price will be affected by this taproot so the dominance of this coin will evenly split off and the altcoin also part of the valuation of the price of BTC.

Luis del Valle Ruiz Ortega - technical in PC and internet

The Taproot will achieve substantial and security changes in Bitcoin, its automatic activation starting in November in block 709632 will inevitably attract more countries, banks and financial companies, to join the adoption of said currency as an option to stabilize their economies. But Bitcoin will need a lot of time and many resources to be able to dominate the world of decentralized finance where Ethereum with its version V.2 surpasses it in quantity and quality. This will affect the price of BTC in the future since the time will come when it will be priced below the price of Ethereum, when this happens, BTC will already be a speculation currency and Ethereum will be the one that occupies the position that BTC has had. Without being a currency attached to a centralized banking system. Time and future events will prove me right.

noe tsertsvadze - Mechanic

Taproot is a soft fork that improves Bitcoin’s scripts to increase privacy and improve upon other factors related to complex transactions.In fact, Taproot makes it possible to hide the fact that a Bitcoin script ran at all. For example, spending Bitcoin using Taproot could make a transaction in a Lightning Network channel, a peer-to-peer transaction, or a sophisticated smart contract become indistinguishable.the upgrade is called Taproot, and it's due to take effect in November. When it does, it will mean greater transaction privacy and efficiency – and crucially, it will unlock the potential for smart contracts, a key feature of its blockchain technology which eliminates middlemen from even the most complex transactions

stan vlad - designer

taproot and Graftroot technologies are complicated in their own way. , these are Blockchain Privacy Technologies that hide the source and the destination of a transaction. It's similar to multisig or coinjoin. Therefore, they are on the same level as DeepSend. Tor on the other hand provides Network Anonymity, as in anonymous IP addresses that can't be linked to addresses and transactions, which is already what the DeepOnion wallet does. Bitcoin will reach an average price of US$280,000

John Granofsky - Director of Sales

Widespread Taproot adoption could address some of Bitcoin's most glaring negatives, and that is the lack of privacy when it comes to BTC transactions as well as increased block transactions per second. Most importantly, the addition of a smart contract protocol will lead to more applications being built on BTC vs ETH. This would help with large scale adaption of BTC as a currency and not merely a store of value, and increase its utility among DApp developers. BTC price over the long term should benefit from these improvements, though in the short term price predictions are largely meaningless because of its volatility.

Ukwuoma Tochukwu - Developer

Having privacy and transaction performance improved with lower transaction fees will definitely affect the crypto economy positively. It will have a huge impact as it will create more chances for bulk purchases as transaction fees are low and privacy assured, will be of a positive impact on the price of bitcoin as more purchases are made.

John Kenny - IT Consultant / Network Engineer

Personally I still feel Proof Or Work blockchains until they can find a workaround for the current mass energy consumption I cant see it having a lasting impact unless Taproots changes actually do what it promises although for 2022 It cant help too much in that respect I still feel. As far as what It might do to price predictions Its certainly going to diversify Bitcoin further although I cant see it having too much of impact for prices in 2022 is my opinion...

Agus Azhar - Promotor Cryptocurrency

Bitcoin will stay at $50K this year, although now it's down to $31k due to bad news but BTC is the trigger for the ups and downs of altcoins, so altcoin investors and developers will buy BTC to maintain the stability of the project or its assets in altcoins

Everlyn Mendoza - social media evaluator

Bitcoin Taproot combined with Schnorr signature will become more safe and has no impact on Bitcoins price. It will remain bullish before the end of 2022 and rise up high through its highest potential price. So for the hodlers keep on hodling until it reaches the momentum.

Fuad Sahinović Sahinovic - Cyber Security, Blockchain and 3D Printing

The price will likely not be affected by any of these features as the key value proposition of Bitcoin lies in its scarcity. The next halving will therefore be a much bigger and key impact on the BTC price.

Robert Gazvoda - Crypto and startup advisor | Project developer | listing agent

I believe that Taprot, and everything that will follow, will have a positive impact on the price of transactions and reduce them concretely. This will increase the number of transactions and the usability of BTC for small users. But the price of BTC will not be affected, as the price is conducted by big players.

john eric coronado - college

Taproot will integrate the Schnorr digital signature scheme into Bitcoin, upgrading Bitcoin's core cryptography. Taproot builds on the SegWit upgrade to improve Bitcoin's privacy and lower transaction fees. Taproot makes future Bitcoin upgrades easier by reforming Bitcoin's scripting language.

Jon Courtney - Minister

The proposed changes that are coming in November will certainly help the market. However, as many prominent experts have pointed out, bitcoin is a very energy intensive process, it may lead to higher energy costs. There are already so many options available for smart contracts such as AMP. I feel that it will be helpful to the bitcoin community, but it has a long way to go. I anticipate quite a volatile market to spark from this. You can look at other cryptocurrencies such as ethereum to see previews of how the hard forks will affect the ecosystem. So far as privacy is concerned, we have witnessed the ransomware attacks and how they traced the money down. It's a tool, some will use it for good, others for bad. The bigger issue at hand is that these hackers know that it's only a matter of time before quantum computers can solve the equations far faster than the systems we have right now. It's ripe for exploitation. The governments of the world are already tasking regulations to clamp down on these attacks. It's a rather fragile system still. Overall, I would say the prices will bounce around right around the time it hard forks. People don't like changes that are rapid. They look for stability. So any fork can have unintended consequences.

Miguel Rodríguez García - Investment, B2B sales, business developent, marketing.

Taproot is important for BTC and probably will help reduce the impact and duration of a possible bear market in my opinion. With all the different things going on at the same time is difficult to determine exactly how much will impact the price but I would say is one more factor to bring new people to BTC with the DEFI posibilities.

Victor Osibajo - IT Consultant / Crypto Trader

With the Taproot implementation, it will bring more participants to the Bitcoin ecosystem as their privacy will be protected which will drive more adoption and invariably affect the price to surge upward most especially in the early year of 2022. In the absence of Taproot, BTC transactions can be detected when complex functionality is used. When this feature is activated in conjunction with Schnorr signatures that provide a simple way of generating short signatures (cluster several signatures involved in the transaction into a single one), node operators will have to adopt the new Taproot’s consensus rules which can take several months and this will make all transactions to appear as just a single one (peer to peer alike) Major advantages that it will bring into the Bitcoin ecosystem is the reduction in the transaction fees, there will be more transaction per block and the amount of data to be transferred and stored on the blockchain will be greatly reduced. This will be a great plus for BTC in term of adoption and price movement.

Skylar Holmes - crypto smart contract dev

I would lean towards practically no difference even if it genuinely makes necessary improvements. Bitcoin is a value store, its true worth is merely inherented. I dont see the potential for BTC developing any adoptable utility. Improvements, yes but you can compare to Etheruem, they have the most utility- they created it! And they are clearly s ooter struggling to develop their evolution chain Eth 2.0. I dont see taproot making any long term noticable differences for Bitcoin.

Rockson Anokye - Student

The upsurge in the price of cryptocurrencies is proportional to the practical use cases of the digital asset that are adopted by the masses. “Upgrade of bitcoin Taproot might just be the key element that would propel it into mainstream finance. The bottom line is the kind of revolution that the Taproot upgrade might bring for Bitcoin is phenomenal," said Patel. Economic and financial boosting is projected to occur after this upgrade. This will bring a positive impact on the crypto currencies market

Summary

The majority of experts in the analysis believe that Bitcoin Taproot would bring economic and financial benefits to the crypto world. Crypto enthusiasts are hopeful about a possible future where Taproot will have an impact on Bitcoin price too, which may happen if it ever becomes widely adopted for commerce transactions.

65% believe that it’ll have a positive economic and financial impact, while 33% believe that it will have a negative impact. 54% believe that Taproot will not have an effect on the Bitcoin price, and 36% believe a positive economic and financial impact would lead to a price rise.

Experts agree that with increased adoption rates, more people will be willing to use Bitcoin for transactions. This will result in a more stable BTC price.

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