Advanced Bitcoin: Lightning, Taproot, node, BIPs, Liquid

Lightning Network beyond the basics

Lightning Network×Lightning NetworkSecond-layer payment network on top of Bitcoin. Enables near-instant and near-free payments through channels opened between users.See in the lexicon → is a second-layer protocol on top of Bitcoin, designed by Joseph Poon and Thaddeus Dryja in 2015, operational since 2018. For most users, Lightning is a mobile wallet×WalletSoftware or device that manages your Bitcoin keys and lets you sign transactions. A wallet does not really « hold » your bitcoins, it holds the keys that prove you own them.See in the lexicon → (Phoenix, Wallet of Satoshi×Satoshi (sat)The smallest unit of bitcoin. 1 BTC = 100 million satoshis. Named after the creator. In 2026, talking in sats becomes common as the price of one BTC rises.See in the lexicon →, Blink) that allows instant payments at very low cost. Under the hood, it is a fascinating technical infrastructure : a network of bidirectional payment channels where each channel is a 2-of-2 on-chain multisig×Multisig (multi-signature)Configuration where a transaction must be signed by several independent keys to be valid (for example 2 of 3). Reduces the risk that a single key theft causes loss of funds.See in the lexicon →, where payments transit via HTLCs (Hashed Time Lock Contracts), and where routing depends on a public topology of channels and their capacity.

The advanced topics of 2026 go beyond « how to pay ». They include splicing×SplicingAdding or removing capacity from a Lightning channel without closing it (BOLT 2 extension). Avoids closings and reopenings that are costly in on-chain fees.See in the lexicon → (extended BOLT 2 in 2023, which allows adding or removing capacity from a channel without closing it), BOLT 12 (static offers and invoices, which replace traditional BIP×BIP (Bitcoin Improvement Proposal)Standard document that describes a proposed improvement to the Bitcoin protocol. Numbered (BIP 32, BIP 39, BIP 174, and so on). Open, public process on GitHub.See in the lexicon → 21 invoices), LSPs (Lightning Service Providers) which manage incoming liquidity for users without technical constraint, and fine management of one's own liquidity (rebalancing×RebalancingRebalancing your portfolio by selling part of what has risen and buying what has fallen, to return to a target allocation.See in the lexicon →, channel management).

The community debate on Lightning in 2026 revolves around three axes. First, potential centralisation : dominant LSPs (River Financial, Voltage, Amboss) attract a growing share of liquidity, which raises questions of censorship and robustness. Second, interoperability with other networks (Ark, Cashu eCash×eCash (Cashu, Fedimint)Bearer tokens backed by Bitcoin, issued by a mint (Cashu) or a federation (Fedimint). Maximum privacy, but trust in the issuer; a complement to Lightning.See in the lexicon →, statechains) that bring different trade-offs on trust and sovereignty. Third, protocol evolutions (Taproot×TaprootMajor Bitcoin upgrade activated in November 2021 (BIP 341). Brings more privacy, scripting flexibility and the efficiency of Schnorr signatures.See in the lexicon → Channels in deployment, ASMR Anonymous Multi-hop Receivers, stable BOLT 12).

For a node×NodeComputer that runs the Bitcoin software and takes part in the network by validating blocks and transactions. A « full node » keeps a complete copy of the blockchain.See in the lexicon → operator, Lightning represents about 90 minutes a week of active maintenance : monitoring channels, rebalancing if necessary (typically a circular swap via Lightning Loop or Boltz), adjusting fees according to routing demand, verifying SCB×SCB (Static Channel Backup)Static backup of Lightning channels (LND). If the node crashes, it allows requesting the cooperative closing of channels and recovering the funds.See in the lexicon → (Static Channel Backups). The article dedicated to advanced Lightning in this topic details these technical operations.

Taproot and the evolution of Bitcoin scripting

Taproot×TaprootMajor Bitcoin upgrade activated in November 2021 (BIP 341). Brings more privacy, scripting flexibility and the efficiency of Schnorr signatures.See in the lexicon → is the major Bitcoin protocol update deployed on 14 November 2021, the third significant soft fork×Fork (soft fork, hard fork)Change to the protocol rules. A soft fork stays compatible with old nodes (SegWit, Taproot); a hard fork creates a separate chain (Bitcoin Cash in 2017).See in the lexicon → after SegWit×SegWit (Segregated Witness)Upgrade activated in 2017 that separates signature data from the rest of the transaction. Lowered fees and paved the way for Lightning Network.See in the lexicon → (2017) and CLTV/CSV (2015). It combines three interdependent BIPs : BIP×BIP (Bitcoin Improvement Proposal)Standard document that describes a proposed improvement to the Bitcoin protocol. Numbered (BIP 32, BIP 39, BIP 174, and so on). Open, public process on GitHub.See in the lexicon → 340 (Schnorr×SchnorrMore modern signature algorithm, activated by Taproot in 2021 (BIP 340). More efficient, enables signature aggregation (MuSig2).See in the lexicon → signatures replacing ECDSA×ECDSALegacy signature algorithm used by Bitcoin before Taproot. Signs a transaction with a private key to prove ownership.See in the lexicon →), BIP 341 (Taproot scripts replacing P2WSH), BIP 342 (Tapscript×TapscriptScript language introduced by Taproot (BIP 342), an extended version of Bitcoin script with new opcodes. Technical basis of recent uses, from native multisigs to inscriptions.See in the lexicon →, extended script language for new opcodes). Adoption has been progressive : 5 percent of transactions on Taproot end 2022, 30 percent end 2024, 55 percent in May 2026 according to transactionfee.info figures.

Three main technical contributions. First, Schnorr signatures replace ECDSA and allow signature aggregation (MuSig2×MuSig2Schnorr signature aggregation protocol (BIP 327). Lets multiple signers produce a single signature indistinguishable from a single-signer one.See in the lexicon →) : several signers of a 2-of-3 multisig×Multisig (multi-signature)Configuration where a transaction must be signed by several independent keys to be valid (for example 2 of 3). Reduces the risk that a single key theft causes loss of funds.See in the lexicon → produce a single signature indistinguishable from a simple signature in the eye of an external observer. This property improves privacy (the multisig is no longer visible on-chain) and efficiency (reduced fees). Second, MAST×MAST (Merkleized Alternative Script Trees)Structure introduced with Taproot: several spending conditions for the same UTXO, organised as a tree. Only the branch actually used is revealed on-chain, the rest stays private.See in the lexicon → (Merkleized Alternative Script Trees) allows defining several spending conditions for the same UTXO×UTXO (Unspent Transaction Output)« Chunk » of bitcoin received and not yet spent. A wallet does not have a single balance, it has a collection of UTXOs whose sum makes up the balance.See in the lexicon →, with selective revelation : only the used branch is revealed, the others remain hidden. Third, Tapscript adds opcodes like OP_CHECKSIGADD useful for native multisigs.

Concrete applications in 2026 are numerous. Modern multisig wallets (Sparrow, Casa, Unchained) use MuSig2 for 2-of-3 and 3-of-5 multisigs, which makes these configurations indiscernible from a single-sig wallet×WalletSoftware or device that manages your Bitcoin keys and lets you sign transactions. A wallet does not really « hold » your bitcoins, it holds the keys that prove you own them.See in the lexicon → on the public blockchain×BlockchainA public, shared ledger that records every Bitcoin transaction in blocks linked together cryptographically. Each participant in the network keeps a copy.See in the lexicon →. DLC protocols (Discrete Log Contracts) for decentralised bets and financial contracts are made practical by Schnorr signatures. Taproot-enabled Lightning Channels (deployed 2024-2025) improve the privacy of Lightning operations. And Ordinals×Ordinals (inscriptions)Protocol (2023) that numbers each satoshi and allows inscribing data (images, text) directly on-chain via Tapscript. At the origin of the debate on block space usage.See in the lexicon →/Inscriptions (the hot topic of 2023-2024) technically rest on Tapscript and its envelope opcode×OpcodeElementary instruction of the Bitcoin script language (OP_CHECKSIG, OP_RETURN...). Scripts combine opcodes to define the spending conditions of funds.See in the lexicon →.

Taproot is widely seen as the best Bitcoin update since SegWit in terms of application potential, but usages take time to arrive : tools take 2 to 3 years to integrate novelties correctly. The Taproot/Schnorr/MAST article of this topic details the cryptographic mechanics and use cases.

Running your own Bitcoin node

Running your own Bitcoin Core node is the founding technical act of the advanced Bitcoin community. A full node×NodeComputer that runs the Bitcoin software and takes part in the network by validating blocks and transactions. A « full node » keeps a complete copy of the blockchain.See in the lexicon → downloads the entire blockchain×BlockchainA public, shared ledger that records every Bitcoin transaction in blocks linked together cryptographically. Each participant in the network keeps a copy.See in the lexicon → (580 GB in May 2026), validates all transactions according to consensus rules, and keeps the UTXO×UTXO (Unspent Transaction Output)« Chunk » of bitcoin received and not yet spent. A wallet does not have a single balance, it has a collection of UTXOs whose sum makes up the balance.See in the lexicon → index. It consumes about 50 GB of bandwidth per month and runs in the background without daily intervention. Five reasons motivate advanced Bitcoiners to run their own node, and the first is sovereignty : your wallet×WalletSoftware or device that manages your Bitcoin keys and lets you sign transactions. A wallet does not really « hold » your bitcoins, it holds the keys that prove you own them.See in the lexicon → no longer depends on a public Electrum server or a third-party block explorer.

Several distributions facilitate the installation. RaspiBlitz×RaspiBlitzReady-made software distribution that turns a Raspberry Pi into a Bitcoin and Lightning node. A pioneer of the genre, with an active German-speaking community.See in the lexicon → (full SD image for Raspberry Pi×Raspberry PiSmall credit-card-sized computer at a low price (60 to 100 EUR). Lets you run a Bitcoin node at home.See in the lexicon → with Bitcoin Core×Bitcoin CoreReference implementation of the Bitcoin software, written in C++ and maintained by an open-source community. This is the software that most nodes run.See in the lexicon →, LND, Tor, RTL for Lightning management), Umbrel×UmbrelEquivalent distribution for mini-PCs or Raspberry Pi, with a polished web interface and an app store (BTCPay, mempool.space, Sparrow Server, and so on).See in the lexicon → (polished graphical interface, app ecosystem, compatible with Raspberry Pi and NUC), Start9×Start9 (StartOS)Umbrel alternative focused on sovereignty and privacy. More technically demanding, more rigorous on privacy.See in the lexicon → Embassy (focus on sovereignty, app ecosystem similar to Umbrel but with a different philosophy), MyNode×MyNodeAnother full-stack node distribution, with a commercial model and a paid Premium tier.See in the lexicon → (2018 pioneer, less active since 2023). All these distributions are open source×Open sourceSoftware whose source code is public and modifiable by anyone. A fundamental auditability guarantee in Bitcoin.See in the lexicon →, free, and installable in 2 hours with hardware around 300 EUR (Pi 5 + SSD 1TB + power + case).

For those who want more power, the NUC (Intel's Next Unit of Computing or ARM alternatives) remains the recommended option : around 400 to 600 EUR for a machine that runs a Bitcoin Core + Lightning node + a Liquid node + several monitoring tools without breaking a sweat. It is the typical setup to also host a Liquid node and side tools.

The operational effort of a personal node is low once the initial configuration is done, about 30 minutes a month : checking logs, applying Bitcoin Core updates (one release every 4 to 6 months), verifying Lightning wallet backups. The Running a Bitcoin node article of this topic details hardware choices, distributions, and operational best practices.

The BIP process, how Bitcoin evolves

Bitcoin has no formal governance. No deciding foundation, no steering committee, no majority vote. Protocol evolutions go through the BIP process (Bitcoin Improvement Proposal), formalised by Amir Taaki in 2011 in BIP×BIP (Bitcoin Improvement Proposal)Standard document that describes a proposed improvement to the Bitcoin protocol. Numbered (BIP 32, BIP 39, BIP 174, and so on). Open, public process on GitHub.See in the lexicon → 1 itself. A BIP is a standard document that describes a technical proposal, its rationale, its specification, its reference implementations, and its backward compatibility. More than 400 BIPs have been proposed since 2011, of which about 80 are effectively integrated into the protocol and used in 2026.

The BIP process is not democratic in the political sense. It is rough consensus : a BIP moves forward if it convinces a broad coalition of developers, miners, node×NodeComputer that runs the Bitcoin software and takes part in the network by validating blocks and transactions. A « full node » keeps a complete copy of the blockchain.See in the lexicon → operators, and users. The role of Bitcoin Core×Bitcoin CoreReference implementation of the Bitcoin software, written in C++ and maintained by an open-source community. This is the software that most nodes run.See in the lexicon → developers is to propose and implement ; the role of miners is to signal their support via mined blocks (BIP 9 or BIP 8 mechanics) ; the role of node operators is to choose whether to upgrade their software ; the role of users is to vote with their wallet×WalletSoftware or device that manages your Bitcoin keys and lets you sign transactions. A wallet does not really « hold » your bitcoins, it holds the keys that prove you own them.See in the lexicon → by using the new features. Nobody has formal veto power, but everyone has effective veto power (forking).

This distributed governance paradoxically works well because it is slow. A major BIP (Taproot×TaprootMajor Bitcoin upgrade activated in November 2021 (BIP 341). Brings more privacy, scripting flexibility and the efficiency of Schnorr signatures.See in the lexicon →, SegWit×SegWit (Segregated Witness)Upgrade activated in 2017 that separates signature data from the rest of the transaction. Lowered fees and paved the way for Lightning Network.See in the lexicon →, BIP 9) typically takes 3 to 5 years between initial proposal and deployment. This slowness protects against rushed changes, and forces broad consensus. The downside : Bitcoin evolves slowly compared to other protocols, which is a recurring criticism from altcoins.

A few major BIPs structure the current Bitcoin : BIP 32 (HD wallets, 2012), BIP 39 (mnemonic seeds 12/24 words, 2013), BIP 141 (SegWit, 2017), BIP 173 (Bech32 addresses, 2017), BIP 340/341/342 (Taproot, 2021), BIP 174 (PSBT×PSBT (Partially Signed Bitcoin Transaction)Standard format (BIP 174) that lets you build a transaction on one device, sign it on another and broadcast it from a third. Backbone of the modern multisig workflow.See in the lexicon →, 2017, base of multisig×Multisig (multi-signature)Configuration where a transaction must be signed by several independent keys to be valid (for example 2 of 3). Reduces the risk that a single key theft causes loss of funds.See in the lexicon → cooperation). The Major BIPs article of this topic details the 10 BIPs that most impacted the ecosystem, with date, sponsor, problem solved, and current adoption.

Liquid Network and the sidechain ecosystem

Liquid Network is a Bitcoin sidechain launched by Blockstream in September 2018. Technically, it is a separate chain with its own blocks (one every minute), but pegged to Bitcoin by a federation×Federation (sidechain)Group of entities (exchanges, companies) that co-sign the operations of a sidechain like Liquid. A trust model halfway between a single company and Bitcoin.See in the lexicon → system : 65 functionaries (exchanges, mining×MiningProcess of validating blocks through proof of work. Consumes electricity by design : that is what secures the network.See in the lexicon → operators, Bitcoin funds) collectively sign peg-in×Peg-in, peg-outTransfer of BTC to a sidechain (peg-in, e.g. BTC to L-BTC on Liquid) and the reverse operation (peg-out). On Liquid, the operation is signed by the federation.See in the lexicon → operations (BTC to L-BTC) and peg-out×Peg-in, peg-outTransfer of BTC to a sidechain (peg-in, e.g. BTC to L-BTC on Liquid) and the reverse operation (peg-out). On Liquid, the operation is signed by the federation.See in the lexicon → (L-BTC to BTC). This federation introduces a trust that pure Bitcoin does not have, but offers in return features Bitcoin does not have : confidential transactions (encrypted amounts), issued assets (USDt on Liquid, BMN collective bonds), confirmations in 2 minutes.

In practice, Liquid is not used to store one's main value (which stays on the Bitcoin chain), but for specific operations : sending large funds in confidentiality (the federation only sees encrypted amounts), receiving USDt without going through Ethereum (Liquid fees of a few cents per transaction against several dollars on Ethereum), participating in Bitcoin fund managers (Hodl×HODLHolding bitcoins without selling, despite the volatility. The word comes from a typo, « I AM HODLING », posted on a forum in 2013 that turned into a joke and then a mantra.See in the lexicon → Hodl) that accept Liquid.

Liquid is not the only sidechain×SidechainIndependent parallel chain linked to Bitcoin through a peg-in / peg-out mechanism. Liquid Network is the main Bitcoin sidechain.See in the lexicon →. Rootstock (RSK) proposes an EVM-compatible chain pegged to Bitcoin for smart contracts. Stacks adds an independent but Bitcoin-anchored smart contract layer. Drivechains×Drivechains (BIP 300/301)Proposal by Paul Sztorc: sidechains without a federation, secured by the Bitcoin miners themselves. Highly debated in the community.See in the lexicon → is a Paul Sztorc proposal (BIP×BIP (Bitcoin Improvement Proposal)Standard document that describes a proposed improvement to the Bitcoin protocol. Numbered (BIP 32, BIP 39, BIP 174, and so on). Open, public process on GitHub.See in the lexicon → 300/301) that would allow federation-free sidechains, validated by Bitcoin miners themselves. The Drivechains debate is ongoing in 2026, with strong opposition from Bitcoin maximalists (Adam Back, Luke Dashjr) and lukewarm support from the technical community (Peter Todd remains sceptical).

Sidechains remain a technically fascinating but politically delicate topic. They introduce trade-offs (trust in the federation, additional complexity) that not all Bitcoiners accept. The Liquid Network and sidechains article of this topic details the mechanics, the trade-offs, and the state of 2026 debates.

Bitcoin privacy after the Samourai shutdown

Bitcoin is not anonymous. The blockchain×BlockchainA public, shared ledger that records every Bitcoin transaction in blocks linked together cryptographically. Each participant in the network keeps a copy.See in the lexicon → is public, and any transaction links an address to another, traceable indefinitely by anyone with a block explorer. Bitcoin privacy is therefore built actively, through practices and tools. On 24 April 2024, the sudden shutdown×ShutdownDeliberate stopping of a service or device. In Bitcoin, the term is often used for the Samourai Wallet shutdown in 2024 or Blockfolio in 2022 : abrupt end of a service.See in the lexicon → of Samourai Wallet×Samourai WalletPrivacy-focused wallet shut down under US regulatory pressure in April 2024. A heavy blow for mainstream Bitcoin privacy.See in the lexicon → (prosecuted by the American DOJ for facilitating money laundering via Whirlpool) hit the European privacy community. Within days, Whirlpool (the most popular CoinJoin×CoinJoinTransaction-mixing technique where several users combine their UTXOs into one large transaction, in order to break the input / output link.See in the lexicon → service in 2023) closed, leaving thousands of users without immediate alternative.

The 2026 privacy ecosystem rebuilt itself around several alternatives. Wasabi 2.0 (with Wabisabi, an improved CoinJoin protocol designed by zkSNACKs) remains active and open source×Open sourceSoftware whose source code is public and modifiable by anyone. A fundamental auditability guarantee in Bitcoin.See in the lexicon →, with distributed coordinators. Cake Wallet×WalletSoftware or device that manages your Bitcoin keys and lets you sign transactions. A wallet does not really « hold » your bitcoins, it holds the keys that prove you own them.See in the lexicon → offers an integrated service for general public users. JoinMarket remains the most technically decentralised solution but requires advanced skills. PayJoin×PayJoin (P2EP)Variant of CoinJoin where the recipient quietly adds one of their UTXOs as an input. Improves privacy and breaks heuristic analysis.See in the lexicon → (BIP×BIP (Bitcoin Improvement Proposal)Standard document that describes a proposed improvement to the Bitcoin protocol. Numbered (BIP 32, BIP 39, BIP 174, and so on). Open, public process on GitHub.See in the lexicon → 78) is natively integrated in Sparrow Wallet and allows passive privacy without explicit CoinJoin.

A common combination since the shutdown : Wasabi 2.0 for occasional CoinJoins, Sparrow with PayJoin for everyday transactions, and a JoinMarket maker for those who want to provide liquidity to the network. Enough for acceptable privacy without dependency on a centralised service that could close overnight.

The debate on Bitcoin privacy in 2026 goes beyond technical tools. It raises the political question : is financial privacy a right or a privilege ? The Samourai case (developers Keonne Rodriguez and William Lonergan Hill are awaiting trial in the United States in 2026) showed that regulation can directly target privacy tool developers, not only their users. This regulatory pressure changes the risk calculation for European and American developers.