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What you need to know about SegWit?

Discussion in 'World NEWS' started by STARK, Jul 20, 2017.

  1. STARK

    STARK Administrator Staff Member Administrator

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    Via Bitcoin.org

    Chain split

    Since Bitcoin’s inception, its network has facilitated hundreds of millions of transactions. As a result, different groups of people (developers, investors, entrepreneurs, etc.), have debated on the best ways Bitcoin can be optimized to allow it to exponentially scale even further. In recent months, alternative software has been released that represents some of the interests of the aforementioned groups of people - software that is scheduled to go live toward the end of July.

    The Bitcoin block chain, which is a record of all Bitcoin transactions to date, relies on a network of thousands of Bitcoin nodes running Bitcoin software. On Tue Aug 01 2017 05:30:00 GMT+0530 (India Standard Time), the Bitcoin block chain may experience what is known as a chain split. This is when a portion of Bitcoin’s nodes run software that another portion of nodes are not fully compatible with. As a result, some nodes may propagate confirmed transactions that other nodes may not accept or recognize. This may result in unreliable confirmation scoring for an unknown length of time. This means that any bitcoins you receive during this period could disappear from your wallet or be a type of bitcoin that other people will not accept as payment, until the situation is resolved.

    Once the situation is resolved, confirmation scoring will either automatically return to their normal reliability or there will be two (or more) competing versions of Bitcoin as a result of a split block chain. In the former case, you may return to using Bitcoin normally; in the latter case, you will need to take extra steps in order to begin safely receiving bitcoins again.

    This post currently describes what actions you can take to prepare for this situation. Subsequent to Tue Aug 01 2017 05:30:00 GMT+0530 (India Standard Time), we will update this post as best we can with relevant information, but you are also advised to monitor other Bitcoin news sites and community resources for updates and to cross-check all information, as someone may attempt to spread false news in order to exploit the situation.

    Remember that you alone are responsible for the safety of your bitcoins, and that if you lose control of them for any reason, there is nothing the operators or contributors to this website can do to help you.

    What Could Happen to Bitcoin?

    A number of bitcoin improvement proposals (all aimed at boosting the cryptocurrency’s transaction capacity) are set to come to a head in the coming weeks, ending either in a smooth upgrade, a potentially difficult split, or maybe, simply status quo.

    While it looks likely that at least one will go into effect, it's not clear which proposal (or proposals) will trigger, meaning, for now, we're left tracking how much support each proposal will actually get – and when.

    In separate guides, we've covered the two main proposals, SegWit2x and BIP 148, as well as how BIP 91 looks to moderate between them.

    Still, understanding how the proposals interact can be difficult.

    Today, 76% of bitcoin's mining hashrate is signaling for BIP 91. So, it looks like it could go through. But, if it doesn’t reach the necessary threshold of 80% for a period of 336 blocks by August 1, then BIP 148 will kick in, setting off a slew of ifs and whens.

    To help you navigate, we've put together the following timeline to show the many ways the summer's scaling drama could unravel:

    [​IMG]

    Recommendation for the users to safeguard the value of their coins during this upgradation:
    1. Do not trust any payments you receive after Tue Aug 01 2017 05:30:00 GMT+0530 (India Standard Time) until the situation is resolved. No matter how many confirmations the new payment says it has, it can disappear from your wallet at any point up until the situation is resolved.

    2. Try not to send any payments. During the event there may be two or more different types of bitcoin and you may send all of the different types to a recipient who only expects one type. This would benefit the recipient at your expense.

    3. Be wary of offers to allow you to invest in the outcome of the event by “splitting” your coins. Some of these offers may be scams, and software claiming to split your coins can also steal them.
    Definitions
    • SegWit2x (BTC1): Backed by miners and startups, this proposal seeks to enact SegWit via a soft fork, while committing to a block-size increase by hard fork three months later.
    • Segregated Witness (SegWit): Proposed by volunteers of Bitcoin Core in 2015, SegWit is aimed to increase network capacity and solve transaction malleability via a soft fork. BIP 141, its proposal, requires a super-majority (95%) of miners to signal for the upgrade over two weeks.
    • BIP 91: Created by BitmainWarranty engineer James Hilliard, BIP 91 looks to lock-in SegWit2x's SegWit update before August 1, making the proposal compatible with BIP 148. BIP 91 requires 80% of bitcoin’s miners to signal support for a lock-in and a shorter signaling period than BIP141.
    • BIP 148: Uses an older mechanism for making changes to bitcoin, called a user-activated soft fork (UASF). It requires about 50% of mining pools to support the change. Without that support, BIP 148 could activate and split the network into two competing blockchains.
    • Bitcoin ABC: A version of the bitcoin client that erases SegWit and enables a dynamic block size. It was first proposed in reaction to the idea of a UASF, which has some opposition in parts the industry. If bitcoin splits because of UASF BIP 148, the Bitcoin ABC client will launch on another chain.
     
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