In Bitcoin, each satoshi counts and should not get lost or destroyed. Taproot is a recent update to Bitcoin.
Specialists discovered that a developer destroyed 0.0002 BTC due to the wrong implementation of Taproot, the most recent Bitcoin update.
Bitcoins came to get burned or destroyed because a developer either mistakenly or intentionally failed to generate a proper public key to create the Taproot address where they would send the BTC. To guard, send and receive bitcoins, users need a public key and a private key, which form the basis of the security of our wallets.
Taproot also includes a new algorithm or mathematical procedure to generate these keys, called Schnorr. This algorithm is into Bitcoin Improvement Proposal 340, or BIP-340, and got included in Bitcoin as a privacy enhancement for all who wish to use it in November 2021.
As expressed in Suredbits, a firm that develops functionalities and derivative assets in Bitcoin, a developer wanted to create a public key through Schnorr using an incompatible parameter for the algorithm elliptic curve, the secp256k1 curve.
This parameter caused the Taproot script or command to fail to execute its activities since the public key inserted into the script originates from an invalid x-coordinate. In this way, 0.0002 BTC, or 20,000 satoshis, which are currently equivalent to 8.40 US dollars (USD), were destroyed.
When users refer to the BTC being burned or destroyed, they mean that the assets got sent to an address that no one can access, as it would be cryptographically unlikely that users could generate the correct keys to move the said bitcoins.
This event appeared when Suredbits found a bug in their Taproot transaction reader/explorer, where they could only see correct or valid transactions, not incorrect ones. Updating their bitcoin-s code library, they found that someone had burned the bitcoins that way.
Additionally, Suredbits has also found 14 different bugs related to the implementation of Taproot by some developers. In total, the errors add up to 24,197 satoshis burned, which is equivalent to approximately USD 10.
Although it may seem like a minimal amount, one of the maxims of Bitcoin is that every single satoshi (sat) counts, so having lost these funds can be just as painful considering the limited scarcity of this cryptocurrency.
It should not be necessary to expect these sats to be worth millions of dollars to realize the importance of taking care of them and not losing them in this way.
It is not the first time that errors happen when there is an attempt to carry out Taproot transactions, but with the wrong parameters. One of the most notorious cases was the Binance exchange, which made a mistake when sending some BTC via Taproot to a user, permanently losing them.
The exchange later acknowledged the error and refunded the funds. However, this situation raised red flags regarding the adoption of Taproot in services like this, which are giants of the Bitcoin and cryptocurrency industry.
By: Jenson Nuñez
