• Bitcoin Taproot Utilization has recently crossed the 43% mark due to an increase in BRC-20 tokens like Pepe Coin.
• The upgrade initially saw little usage, but two different metrics are available to track its progress—the “adoption” and the “utilization” indicators.
• The surge of Taproot utilization is largely attributed to the emergence of Ordinals protocol, which uses Taproot and allows for data inscription on the network in the form of Inscriptions.
Bitcoin Taproot Utilization Crosses 43% Mark
On-chain data shows that Bitcoin taproot utilization has sharply surged recently as BRC-20 tokens like Pepe Coin have exploded in popularity. As pointed out by Rafael Schultze-Kraft, the co-founder of the on-chain analytics firm Glassnode, Taproot is currently being used in more BTC transactions than ever before.
What Is Taproot?
Taproot refers to a Bitcoin upgrade that went live in November 2021 and introduced some changes to make transfers more efficient and faster. The upgrade initially saw little usage, but it has been coming into use a lot more recently.
Tracking Progress of Taproot Utilization
There are two different metrics available that aim to track the progress of Taproot being accepted: the “adoption” and the “utilization.” The adoption measures the total percentage of BTC transactions that contain at least one Taproot input, however this indicator isn’t considered reliable as it doesn’t contain complete information about actual adoption of the upgrade. To solve this issue, Glassnode developed an utilization metric which tells us how much in-use the upgrade is by measuring actual amount of spent outputs involving Taproot.
Recent Surge Of Taproot Utility
The recent surge in taproot utility can be attributed to emergence of Ordinals protocol which uses taproots and allows for data inscription on blockchain network via Inscriptions method.. Below is a chart showing trend in both adoption and utilization over last year:
Conclusion
TapRoot has found increasing use due to its improved efficiency and speed compared with traditional methods when it comes to making transfers on Bitcoin’s blockchain network. This increased acceptance is primarily due to protocols such as Ordinals Protocol which utilise taproots allowing users to inscribe data onto blockchain networks via Inscriptions method.