How Bitcoin Development Is Evolving?

How Bitcoin Development Is Evolving?

Knowledgebase
24/02/2021 by Koinal
1835
It was 2009 when Bitcoin occurred as the first decentralized cryptocurrency in the world. Throughout the past twelve years, Bitcoin has proven its success and triggered a broad change in the traditional financial sector.
How Bitcoin Development Is Evolving?

Despite Bitcoin’s recent rising performance that has attracted investors’ attention, many of them still do not know the current advances and developments aiming to further functionalize the world’s most famous digital money. However, technological advancements in Bitcoin have crucial importance in its long-term value and price.

Two significant developments that will likely contribute to Bitcoin’s value proposition are: a new funding source for developers and a new protocol -still in progress- upgrade. Besides, functionality enhancements, like enabling sidechains and smoothing information exchange, have been going on for a while, along with improvements on minor bugs and compatibility issues. Although many people are not aware, Bitcoin is frequently updated to deal with its rivals, overcome various obstacles and continue its existence.

Bitcoin’s code is open-source, which enables anyone to make changes and contributions to it. However, the network’s consensus is required to implement the changes made by developers. This situation complicates the Bitcoin network’s decision-making process since there are thousands with different political, philosophical, ideological backgrounds pursuing disparate goals and agendas. Thus, it is not easy to agree on the changes. This is a well-designed self-protection mechanism that prevents any single-acted change unless the network considers that the entire ecosystem benefits from the planned changes.  

In the beginning, the Bitcoin Foundation was the only funding source for almost all the developers in the Bitcoin network. This has gradually changed since other funders providing financial sources have emerged. Basing upon different funding sources is a crucial issue for Bitcoin as it protects the network from manipulation and unilateral influence. Also, diversity promotes and encourages more innovative approaches to improve the Bitcoin network. This diversity will be carried even further with the Brink initiative that aims to flow funds and donations from a wide range of sources, such as individuals, firms, and companies, to developers through donations.  

Another significant development that will enhance Bitcoin is the upcoming technological upgrade called Taproot. It is believed that the Taproot upgrade will play a key role in strengthening the network’s smart contract functionality and privacy features. Taproot suggests much more privacy by masking the type of transaction. Also, Taproot will bring a new kind of verification signature that could make layer two transactions easier and cheaper. These developments indeed will have positive impacts on Bitcoin’s future. In the long-term, it will increase Bitcoin’s value in prices and its use as a store of value and medium of exchange.

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