Bitcoin’s Taproot Adoption Hits 13% Record High As BTC Targets $25,000
After Bitcoin (BTC) underwent the Taproot rollout, the feature is registering an increase in utilization, partly contributing to the cryptocurrency’s bullish price outlook.
Notably, as of February 16, Bitcoin’s Taproot adoption reached a new high of 13%, just one week after its value was in the single digits, data of cryptanalysis platform Glass node shared by Will Clemente, the founder of the research firm Reflexivity research indicates
Notably, as of February 8, usage was at just 5% on a seven-day moving average (MA) for the feature published after a late 2021 upgrade.
Drivers behind Bitcoin Taroot adoption
It’s worth pointing out that Taproot’s use of the Bitcoin blockchain coincided with Ordinal’s growing popularity on the network. The Ordinals protocol uses Taproot to include data in the witness part of BTC transactions.
Ordinals enable users to attach objects such as images to BTC transactions, resulting in the emergence of non-fungible tokens (NFTs) on the Bitcoin blockchain. With the growing demand for NFTs, Taproot has seen a significant increase in usage.
The Ordinals protocol was made possible by Bitcoin’s soft fork network upgrades, Segregated Witness (SegWit) and Taproot, released in 2017 and 2021, respectively.
The adoption is significant for Bitcoin, considering that it is among the most closely watched aspects of the network. In fact, Taproot is a central part of the Bitcoin ecosystem, considering that it aims to improve the scalability and privacy of blockchains while maintaining security and decentralization.
The feature also offers advanced privacy features such as Schnorr Signature aggregation and virtual exit locking. These features enable secure and cost-effective transactions by allowing users to combine multiple inputs into a single output, reducing transaction fees.
Bitcoin price analysis
As Bitcoin recorded increased activity on Taproot adoption, it appears that the first cryptocurrency has moved past the recent decline triggered by increased regulatory scrutiny. At press time, Bitcoin was trading at $24,505 with daily gains of over 7%.
Elsewhere, Bitcoin’s one-day technical analysis at TradingView has become bullish. A summary of the gauges is for a “buy” at 16, while the moving average is for a “strong buy” at 14. The oscillators are neutral at 7.
It is expected that Bitcoin is likely to extend the rally further if the asset breaks the $25,000 resistance.
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