Amid a spike in transactions and price hike, the Bitcoin Core team has released its version 0.13.1 update. Notably, this release is the first to implement Segregated Witness transactions in the Bitcoin protocol. While controversial, SegWit is one step towards freeing up a degree of block space.
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Bitcoin has suffered full blocks and backlogs intermittently over the past year, with a recent spike in the last several days. While resolved for now, the slowdown in transaction confirmations understandably upsets many people trying to move bitcoins around. No matter what side of the block size issue you’re on, Bitcoin’s ability to scale is paramount.
SegWit’s Attempt to Solve the Block Size Issue
Bitcoin Core release 0.13.1 introduces the next SegWit phase. One of its many technical improvements is the ability to fit almost 2MB of transactions per block. Many estimates put the total block size, with SegWit, at about 1.7mb.
SegWit will not activate until November 15th at soonest, when signaling will begin. SegWit requires 95% of miners to use Core or a compliant client. However, there’s also a well-documented rift between miners and the Core devs.
Currently, the 0.13.1 Core client runs on just over 8% of the nodes on the network. Other parts of the SegWit soft-fork address issues such as transaction malleability, increased security for multisig, script versioning and linear scaling of sighash operations.
Bitcoin Core Post on 0.13.1 on MultiSig Security
Increased security for multisig: Bitcoin addresses (both P2PKH addresses that start with a ‘1’ and P2SH addresses that start with a ‘3’) use a hash function known as RIPEMD-160. For P2PKH addresses, this provides about 160 bits of security—which is beyond what cryptographers believe can be broken today. But because P2SH is more flexible, only about 80 bits of security is provided per address. Although 80 bits is very strong security, it is within the realm of possibility that it can be broken by a powerful adversary. Segwit allows advanced transactions to use the SHA256 hash function instead, which provides about 128 bits of security (that is 281 trillion times as much security as 80 bits and is equivalent to the maximum bits of security believed to be provided by Bitcoin’s choice of parameters for its Elliptic Curve Digital Security Algorithm [ECDSA].)
The multisig security update is a good addition, especially with so many exchange and Bitcoin company hacks. If it’s able to strengthen their security in any way, it will be a big help.
All of these functions are notable as some add layers to make it easier for side-chains like the Lightening Network and Thunder Network to connect and work with the main Bitcoin chain.
New Protocol’s Potential Roadblocks
SegWit may have a tough time reaching 95% of nodes, miners and pools. This is because currently there are many who are unhappy with the base block size not being raised as well.
Several alternatives, such as Bitcoin Classic and Bitcoin Unlimited, normally add features from Core releases as well as their own block size increase — and in some case other features. It’s going to be interesting to see if enough miners and mining pools will follow with the update.
The new features 0.13.1 brings (including SegWit) may be beneficial. However the overall animosity among those with differing views on how and when the base block size should increase could delay or even derail it in the end.
Bitcoin.com will bring you more information on SegWit as well as info on the block size discussion and more, so stay tuned.
What’s your opinion on the new release? Does it solve Bitcoin’s scaling problem in any meaningful way? Let’s hear your thoughts.
Image Source: BitNodes, Huffington Post
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