Over the past month, many Bitcoin exchanges, startups and experts weighed in on the debate between Segregated Witness (SegWit) and Bitcoin Unlimited (BU) supporters.
The main claim of SegWit supports is that nearly 60 percent of nodes within the Bitcoin network are supporting the activation of SegWit. According to 21 Inc’s Bitnodes, approximately 56 percent of all Bitcoin nodes are in support of Bitcoin Core 0.13.0 and the other two minor updates of Bitcoin Core which includes SegWit support on testnet.
What is the debate about exactly?
In comparison, BU supporters and developers, including prominent angel investor and Bitcoin.com CEO Roger Ver, claimed that Bitcoin miners are showing increasing support of SegWit. A chart called “Mining Pool Support by Proposal” provided by Coin Dance and shared by Ver, demonstrated that 17.3 percent of miners support BU while the other 16.67 percent supported the activation of SegWit.
Samson Mow, COO of the world’s longest running Bitcoin exchange BTCC, and Alistair Milne, Bitcoin investor at Atlanta Digital Currency Fund, expressed their support for SegWit stating that SegWit’s transaction malleability solution opens the door for Lightning, a micropayment solution, that is ultimately beneficial for the long-term growth of Bitcoin.
Milne further emphasized the majority support of Bitcoin nodes for SegWit, requesting Bitcoin miners to start listening to its users.
“Betrayal” to the mining community?
In response, Gang Wu, HaoBTC CEO, offered his strong stance against SegWit, describing the Bitcoin Core development team’s efforts in pushing SegWit development instead of a 2MB hardfork which they previously agreed on at the Hong Kong consensus conference as a “betrayal” to the mining community.
Although HaoBTC later published a follow-up statement to explain their neutral attitude towards BU and SegWit, the exchange firmly reaffirmed that it intends to support the Hong Kong agreement that the organization signed.
Opportunities for two-layer solutions
In mid last month, Bitcoin and security expert Andreas Antonopoulos published a blog post in response to Tuur Demeester’s article entitled “Bitcoin: digital gold or digital cash? Both.” In it, Antonopoulos stated that organizations or people that are objecting to Lightning are pushing for off-chain trusted third party custodial or centralized platforms based on trust.
Antonopoulos later acknowledged that he supports SegWit, not necessarily because of its scaling solution but because it provides opportunities for two-layer solutions like Lightning or TumbleBit to enter.
“I'm for SegWit, not because of scaling, but because it offers solutions to many technical issues in Bitcoin,” said Antonopoulos.
Efficient scaling solution
Still, Bitcoin developers like Lightning co-author Thaddeus Dryja firmly believe SegWit can be described as an efficient scaling solution, as it increases Bitcoin block size to at least 2.1MB. On testest, Dryja was able to find 3.7MB blocks, a size 3.7x larger than the current block size.
“I have a script that will spam testnet and make 3.7MB blocks. It’s not an 800KB regular block with txids and output scripts, and a 2.9MB witness block with just a bunch of signatures. It’s a single block, that looks pretty much the same as old blocks with a few extra requirements, that’s 3.7MB,” said Dryja.
Necessary for the long-term growth of Bitcoin
While BU supporters including Ver and Justus Ranvier, lead architect at Stash Crypto, all believe that the elimination of transaction malleability and the entrance of two-layer solutions are necessary for the long-term growth of Bitcoin, they don’t believe SegWit is the best method of doing so.
Ver told Cointelegraph:
“I think ending transaction malleability is great for Bitcoin. The current SegWit soft fork is just one of many many ways that transaction malleability can be ended, but there are many other proposals on the table that may work as well as, or even better than SegWit.”
“BU is not even remotely an option”
In response to Ver’s preference of other solutions, Alex Bergeron from Blockstream stated that other solutions like Tom Zander’s “Flexible Transactions” aren’t viable alternatives, as they aren’t backward compatible, received little to no peer review and aren’t technically sound.
BTCC COO Samson Mow gave Cointelegraph a similar statement:
“The Bitcoin Core contributors, the entire technical community, wallet developers, many mining pools and major exchanges all believe a SegWit soft-fork is the path forward to end transaction malleability and for a safe yet quick way to increase the block size. Flexible Transactions from BU is not even remotely an option as the concept has already been dismissed by the technical community, and more importantly, there is no functioning code available - it's vaporware.”
The lack of peer review has also proven to be an issue for Bitcoin Unlimited, as the Bitcoin Unlimited team recently found buggy codes within the software. The lack of peer review ultimately caused the loss of 13 BTC for Bitcoin unlimited miners.
SegWit - the best alternative so far
At this stage of Bitcoin development, it is of utmost importance to the Bitcoin development community, users, companies and mining community to push for the activation of a safer alternative. Considering Bitcoin Unlimited’s lack of peer review and software which isn’t ready for deployment, SegWit seems to be the best alternative so far.
Industry leaders and large-scale Bitcoin companies like Coinbase and Blockchain have already expressed their support for SegWit. The Blockchain is listed as “SegWit ready” in the SegWit Adoption list of the Bitcoin Core development team.