Coinbase allows Bitcoin transactions to go to root addresses

Coinbase has announced a significant update for its users, which will allow them to send Bitcoin to Taproot addresses on October 8.

This integration extends the accessibility of Taproot, improving privacy, scalability and security. With the latest support, Coinbase has joined prominent crypto exchanges such as Binance, OKX, and Kraken.

In its tweet, the crypto exchange stated:

“We are pleased to announce that Coinbase․users can now send Bitcoin to Taproot addresses, creating access to more onchain destinations.”

Bitcoin developer Greg Maxwell initially presented the Taproot proposal in 2018. Later, Bitcoin developer Pieter Wuille coded the update.

Activated in November 2021 with the approval of 90% of Bitcoin miners, the Taproot update is a soft fork that maintains compatibility with older Bitcoin software, avoiding the disruption of a hard fork. This update includes three proposed Bitcoin enhancements: BIP340 (Schnorr Signatures), BIP341 (Taproot), and BIP342 (Tapscript), designed to increase privacy, efficiency, and smart contract capabilities on the Bitcoin network.

Although its adoption curve has been slow, CryptoQuant CEO Ki Young Ju saw a significant increase in January, with Taproot usage increasing from 1% to 39% in a year

In addition to making transactions more efficient, Taproot’s support for advanced smart contracts has enabled innovations such as BRC-20 and Runes, Bitcoin’s native tokens. He also played a crucial role in the emergence of Ordinals, a protocol that allows unique data entries in Bitcoin, like NFTs on other blockchains.

Bitcoin transaction costs surpassed Ethereum in November 2023, largely due to the influence of Bitcoin Ordinals. Data from BitInfoChart revealed that the average Bitcoin transaction fee was $10.34, changing Ethereum’s average fee of $8.43 on November 20.

The update further led to the rise of Taproot-based startups, such as Taproot Wizards and Tap Protocol, which specialize in developing the Bitcoin Ordinals ecosystem.

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