TapThresh: Privacy-Preserving Threshold Protocol Using Bitcoin Taproot
Year: 2026
Type: article
Abstract: Threshold transactions in Bitcoin is an effective solution for vulnerability of wallets to the loss or compromise of secret keys. It also enhances the applicability of Bitcoin to include use-cases that require partitioning the trust among a set of parties. Currently, the threshold transactions on Bitcoin expose the actual signers within the group of participants. This poses a threat of wallet hacks or theft targeting these signers. To address this issue of privacy, we propose a novel protocol to create threshold transaction using a combination of on-chain locking and off-chain proof of knowledge. As Bitcoin currently does not support verification of zero-knowledge schemes, the proposed protocol uses a Trusted Third Party ( TTP ) to verify the proofs off-chain. The trust on the third party is only limited to its service of signing on behalf of the users. The main contribution is the development and applicability of a m-out-of-N proof of partial knowledge that maintains the privacy of the signers both on-chain from the transaction verifiers and off-chain from the TTP and other signers as well. The protocol leverages Taproot’s spending path flexibility to incorporate dual spending capabilities and employs off-chain zero knowledge Σ-protocols to prove knowledge of private keys without disclosing their associated public keys. Experimental analysis demonstrates improved scalability and privacy than the mainstream threshold signature schemes for Bitcoin. A formal analysis demonstrates and establishes the security goals of the proposed mechanism.
Authors: Anubha Jain, Emmanuel S. Pilli, R.C. Joshi
Language: English
Subfield: Artificial Intelligence
Field: Computer Science
Domain: Physical Sciences
Open Access status: gold
Estimated APC paid: $1,600
OpenAlex ID: W7148975137