Bitcoin moves to SegWit by default in latest update

Posted: 20 February 2018 5:13 pm

The 0.16 bitcoin update makes SegWit easier than ever before, for everyone.

SegWit was first introduced in 2016 as a new way to improve blockchain transactions. It's essentially a different way of packing information into blocks to improve transfer times and reduce fees on the bitcoin blockchain, and others such as Litecoin.

However, it hasn't been very widely used. The latest 0.16 bitcoin update seems to be focused largely on solving this.

One of the main changes is the addition of SegWit to the wallet user interface, letting anyone start using it without any special knowledge.

SegWit is the default address type, but another major change comes with the addition of "bech32" address types, designed to be significantly more user friendly than others. This was also added to the user interface, so anyone should now be able to choose which of the three main address types (legacy, default SegWit or bech32) they want to create.

Other changes include the finalisation of previously experimental code which might give transaction times a further edge, a range of new customisation options and some changes to present information in a more useful and less confusing way.

These changes might be most significant in that they give exchanges and other wallet creators a way of presenting a user friendly SegWit experience for their users, going a long way towards making it the default for bitcoin transactions.

It might also make it easier for them to implement SegWit for themselves. It can be a relatively time consuming process, and many exchanges have directed their efforts to more important changes elsewhere, rather than devoting time to optional SegWit updates.

This update might be especially timely. Offering SegWit as a widely accepted default for new users could make a difference if bitcoin ends up going on another bullrun. In December average bitcoin transaction fees were topping US$20 per transaction, and would often take hours to go through.

The business of the bitcoin network, expressed through transaction fees and delays, has tended to mirror prices so the introduction of SegWit by default might give it more room to grow.

In another potentially positive sign, CoinDesk notes that this major update is all about SegWit, while previous ones have tended to pull together disparate strings of changes. This might suggest a bit more direction and goal-orientation from bitcoin's main developers, with a focus on bitcoin's main pain points; making it easier to use and improving transactions.

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Disclosure: At the time of writing the author holds ETH, IOTA, ICX, VEN, XLM, NANO, SALT, BTC

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