SegWit Locked In To Bitcoin Network

The bitcoin network just witnessed a historic moment. The roadmap scaling solution called Segregated Witness officially locked in to the bitcoin blockchain. This software brainchild of developer Peter Wuille will still take a long, long time to spread throughout the ecosystem. CoinDesk reported SegWit isn’t expected to activate until Aug. 21, which will initiate the domino effect. But it paves the way to solve bitcoin’s scaling issue, since right now the network can manage only a few transactions per second.

The moment SegWit locked in on Tuesday, it proved the leaderless bitcoin community can collaborate to solve foundational issues without forking to create a brand new blockchain.

“It fixes bitcoin’s scalability issues, makes it even harder to manipulate unconfirmed transactions,” cryptocurrency trader Toye Martin told International Business Times. “Everyone seems excited so it's good energy in the crypto space today.”

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Martin knows many of the developers who brought SegWit to life, driven by the desire to make bitcoin accessible to more people than ever before. In order for more people to use bitcoin more often, the blockchain network will need to undergo some serious overhaul this year. Right now, it’s like a crowded highway with just one off-ramp.

What if, in order to send an email, you first had to download every email that anyone ever sent? It would take forever, right? Elizabeth Stark, the CEO of Lightning Labs, is building Lightning Network on top of the bitcoin blockchain using Segwit, to make bitcoin faster and more adaptable. Think of SegWit like that software update you needed to watch embedded videos on your old desktop computer. SegWit isn’t the end all and be all of scaling roadmaps. People are already working on SegWit2X. However, now with SegWit as a base, it’s time to really get this party started.

SegWit is the foundation for solutions like Lightning, which adds a layer on top of everything, changing the way the blockchain network itself works while simultaneously making it easier to build on that network. “It enables instant clearing,” Stark told IBT. “So you can instantly withdraw or deposit or send it to your friend or build apps.”

One of the coolest features the Lightning Network offers is the ability to transfer value between blockchain networks without needing an exchange or a trusted central party. Imagine handing a dollar to a cashier to buy coffee in Italy. As your hand moves, the bill magically shifts and becomes a euro. It’s not a perfect metaphor, but it illustrates what cross-network compatibility can do. “That is a new technology we haven’t seen yet,” Stark said.

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Not everybody agrees on the best way to update bitcoin. Governance has become a huge issue in the blockchain community. Who makes decisions for open source technologies no one owns? Martin said she’s proud of the bitcoin community for the way developers freely contributed their time and resources to implement SegWit, even though the scaling roadmap initially faced widespread resistance. People educated each other, debated in open source forums and cooperated to build something new. Many of those who disagreed made their own currency, Bitcoin Cash, which Martin feels encouraged SegWit supporters to quickly bring their own idea to fruition.

“As a community with differing opinions, everyone still managed to get something very important done,” she said. “We don't need leaders, we need to step up to the plate and get it done and that's what I feel the community did.”