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The most talked about issue faced by Bitcoin is scalability. While the recently deployed Lightning Network is expected to resolve the issue in the coming months, a technology known as Schnorr signatures is being proposed to address scalability issues and spam attacks.
The Schnorr signatures algorithm is considered to be a simple way of structuring digital signatures. If applied to Bitcoin network, it could lead to a significant improvement in Bitcoin transaction confirmation time.
In an article titled “Why Schnorr Signatures Will Help Solve Two of Bitcoin’s Biggest Problems Today”, block chain speaker Sam Wouters explains how the Schnorr signatures protocol can resolve the issues of scalability, while defending the network from some types of spam attacks.
Signatures, which occupy block space, are required to confirm Bitcoin transactions. When multiple signatures are involved, the block space requirement increases, leading to an increase in transaction costs. In the article published in July 2017, Wouters has questioned whether there is a way to use one signature when a single person sends transaction from multiple sources. That is possible with the use of Schnorr signatures.
Schnorr Digital Signature
Wouters has estimated that such an upgrade could bring down the use of storage and bandwidth by at least 25%. Since there will be only one signature per transaction, a spammer may have to spend more to send transactions repeatedly and occupy more block space. The Schnorr signatures algorithm is compatible with multi-signatures (multisig – need for more than one key to authorize a transaction).
An article titled “Technology Roadmap – Schnorr Signatures and Signature Aggregation” has listed the advantages of using Schnorr signatures algorithm. The advantages include constant-size signatures, and reduced data size for validation and transmission across the network. Further, Schnorr allows the policy of multisig to be concealed from a conventional single pubkey. The algorithm is also applicable to the aggregation of multiple inputs for all transactions.
Multiple developer teams are working to resolve the scalability issue. The day of sending Bitcoins instantaneously is not far away.
