P2TR (Pay to Taproot)

P2TR (Pay to Taproot) is the output type activated by the 2021 Taproot soft fork. It is witness version 1, encoded in Bech32m, and its addresses always begin with bc1p. The scriptPubKey is simply OP_1 followed by a 32-byte x-only public key. That key is a single point that can commit to both an ordinary signing key and a hidden tree of alternative spending scripts.

Two ways to spend

A key-path spend reveals only one Schnorr signature against the tweaked output key, indistinguishable on-chain from any other Taproot spend. A script-path spend instead reveals one leaf of the committed script tree plus a control block proving membership, leaving the unused branches private. This means a simple single-sig spend and a complex multisig or timelock can look identical from the outside.

Why it matters for sovereignty

Schnorr signatures enable key aggregation, so an n-of-n multisig can present as a single key and a single signature, shrinking the on-chain footprint and improving privacy. The script tree (a Merkelized structure) only ever reveals the branch actually used. For operators building collaborative custody or covenant-style conditions, P2TR is the cheapest and most private base layer available.

For the underlying upgrade see Taproot, and for the encoding it requires see Bech32m.

See on-chain adoption context in the live network vitals.