BITCOINERS ORGANIZE THEMSELVES TO PRESSURE CURRENCY EXCHANGES AND BITCOIN PORTFOLIOS TO IMPLEMENT SEGWIT

in #bitcoin7 years ago

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Despite being activated several months ago on the Bitcoin network, not all money exchange and purse shops have adopted SegWit, the controversial segregated witness living in blockchain since the end of August this year.

Remember that SegWit, or Segregated Witness is a protocol developed to free space from Bitcoin blocks, separating the signatures from the rest of the transaction data (hence the reason for its name). This means more available capacity to add more transactions within each block without having to increase its size. The latter was the aim of the SegWit2x proposal, which was not subjected to years of development and testing like SegWit, and which added detractors because it would not provide protection against repetitive attacks.

Among the benefits of SegWit are: greater scalability, combating malleability, shorter confirmation times and therefore reduced commissions; and finally, allowing the addition of new protocols such as Lightning Network, an off-chain payment channel that aims to decongest the network even more.

Since its activation in Bitcoin's blockchain, the percentage of transactions with SegWit has not reached even 16% of the total network transactions, according to SegWit Party. This is an optional upgrade. As Subhan Nadeem stated in a recent Hackernoon publication, it is available to anyone who wants to implement it:"Lower fees and more block transactions can happen right now. The code is there on every updated Bitcoin node, waiting to be used. The problem is that SegWit has not been adopted by portfolios, services and ultimately, users,"said Nadeem, in a writing that was recommended on social networks by Tony Vays and also received approval from Jimmy Song.

Nadeem said that SegWit transactions mean savings of between 30 and 40% in commissions over transactions without SegWit; urging bitcoiners to use portfolios and bureaux de change that already have this update in place to take advantage of its benefits. It is in your best interest that you, Bitcoin Hodler, use a SegWit wallet,"he said.

Regarding the status of portfolios and exchange houses that have not yet adopted it, Nadeem noted the following: As long as there is no demand from its customers, these services see no incentive to spend time and money upgrading to SegWit,"something that undoubtedly encouraged bitcoiners to demonstrate through Reddit, where they have already published guidelines in protest form for thousands of users to push for their massive adoption and batch order processing, as well as for an empty mempool and lower rates.

Today, when Bitcoin's growth is so rapid, immediate solutions are urgently needed. It has become commonplace to see how transaction fees have reached incredibly high prices and how a commission market has blossomed due to competition among users on payments to prioritize their transfers.

But let us remember that we are talking about a technology that is in full development and despite the high commissions that currently exist in the Bitcoin network, the fact that there are people willing to pay for them says a lot about the receptivity that, despite its current disadvantages, this technology is having, as Patrick McCorry, the first Ph. D. in cryptocurrencies in the United Kingdom, said.


"The high commission is the result of the backpack problem, i. e. there are more authorized transactions on the network that can be accepted in the block chain.

Users must compete using tariffs to have their operations selected by miners for inclusion in blockchain, as miners will select transactions with the highest tariffs.

A few days ago I noticed that a block had collected about 9 bitcoins in tariffs, which is almost the same amount as the block reward (i. e. 12.5 bitcoins). The fact that people are willing to pay high transaction fees means that Bitcoin is useful (i. e. people will not pay for something that is not useful). I think the rates are pretty high right now."

Patrick McCorry

First Ph. D. in Cryptocurrencies in the United Kingdom


On the other hand, for McCorry, Segwit is not as such a solution for scalability, but it will allow Lightning Network, which according to his words is outlined as such:


"I had never seen SegWit as a scale-up solution: its main objective was to fix the malleability of transactions that can be used to initiate bitcoin contracts such as Lightning Network, and it only provides a small increase in transaction performance (about 1.7 times more transactions).

Ignoring the politics surrounding the SegWit2x / Unlimited movement - there is clear evidence that the network can handle larger blocks - the issue at hand is a governance issue about which group of people are entitled to * explicitly change * consensus rules.

I'm a fan of Lightning Network and I think the work that several teams do is excellent. The main benefit of this approach is that most transactions between stakeholders are processed locally (rather than stored in the block chain), which is why it is advertised as a great escalation solution. However, it still has a list of obstacles to overcome and fortunately we are witnessing a series of research works that try to solve these problems (I must mention that Pedro Moreno-Sánchez has been doing a great deal of research in this area)."

Patrick McCorry

First Ph. D. in Cryptocurrencies in the United Kingdom


Whether SegWit or Lightning Network (which is only viable if the former is activated) it is important for each Bitcoin user to know which exchange and storage services have already been updated to the Segregated Witness, since that way they will be able to protect their satoshis from the high commissions of these times. According to a list of Bitcoin Core, so far there are (amongst portfolios, exchange services and other services) 91 organizations that have already activated SegWit; there are 24 that have them among their plans; there are 7 that have implemented it; and another 25 that are in the process of working.

Portfolios that have already activated it include Ledger Nano S, Trezor, Digital Bitbox, Electrum, Armony, Edge, GreenAddress, BitWallet, Samourai, GreenBits and Electrum. With respect to exchange services and others, Bitfinex, Bitonic, Gemini, Kraken, LocalBitcoins, BTCC, CoinCheck and OpenBazaar. Among those who have not activated SegWit are the Coinbase, CoPay, Exodus and Coinomi portfolios, and services such as ShapeShift, HitBTC, Bitstamp, GDAX, BitBay and Fairlay. If you want to check the status of any other portfolio or exchange house you can do it here. However, Bitcoin Core's list does not include all Bitcoin projects, so it is advisable to keep an eye out for portfolio publications and/or bureaux de change.

Now, as users, what can you do to contribute to adoption? Well, following the action plan that is being disseminated among bitcoiners in Reddit, it is best to ask the portfolios and exchange services to immediately enable SegWit in a courteous manner. And in the meantime, start using those wallets and bureaux de change that have already implemented the update, as well as encouraging others to do the same.


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