Taproot

Taproot is a major Bitcoin protocol upgrade activated in 2021 via soft fork that enhances privacy, efficiency, and flexibility of transactions. It introduces Schnorr signatures and a new output type that makes transactions with complex spending conditions, such as multisignature or smart-contract-like scripts, indistinguishable on the blockchain from simple single-signature transactions. Taproot reduces transaction size, improves scalability, and makes advanced Bitcoin scripts harder to distinguish from regular payments.