Lightning Labs, the developer of the Lightning Network, has introduced Taproot Assets v0.2, an updated version of its Taproot Assets protocol. Currently in the testnet phase, this upgrade aims to provide an innovative and potentially more efficient approach for adding new assets to Bitcoin's blockchain.
Initially known as Taro, the Taproot Assets protocol faced a legal challenge from Tari Labs, which claimed trademark infringement. As a result, Lightning Labs was compelled to rename the protocol. Despite these legal hurdles, the company successfully shifted its focus towards advancing the Bitcoin ecosystem.
Taproot Assets v0.2 announcement. Source: Twitter
Thanks to a successful rebranding, Lightning Labs has persevered in enhancing the Taproot Assets protocol. This protocol enables the creation of tokens, such as stablecoins, on the Bitcoin network through off-chain operations. This approach lightens the network burden that arises from the limitations inherent to the BRC-20 standard. We invite you to explore a dedicated
article on our website to learn more about this newly established standard and the associated challenges.
Lightning Labs has voiced criticism of the current methods used to record assets on the Bitcoin blockchain, describing them as "particularly inefficient" (refer to the article on
BRC-20). In contrast to BRC-20 tokens, the Taproot Assets protocol creates multiple assets off-chain and treats them as a single transaction. This streamlined process not only enhances efficiency but also significantly reduces transaction fees.
It is worth noting that Domo, the creator of the
BRC-20 standard, has endorsed Taproot Assets as the optimal solution for creating new assets on the Bitcoin network. This protocol facilitates a seamless transition for users to the Lightning Network and paves the way for integrating
BRC-20 assets.
In line with their commitment to continuous improvement, Lightning Labs plans to propose revisions to the Taproot Assets protocol specifications for voting within the Bitcoin community. This initiative seeks to simplify and expedite asset transfers based on Bitcoin through the Lightning network, leading to reduced costs and faster transaction times.
