Bitcoin Segregated Witness (SegWit) is an upgrade to the Bitcoin network that aims to increase transaction processing speed, reduce costs, and enhance network security. In 2020, the utilization rate of Bitcoin Segregated Witness has attracted much attention. Let us take a deeper look at the background, advantages, and actual operation of this technology.

Background introduction

As a decentralized digital currency, Bitcoin's transaction data is recorded on the blockchain. There is a problem with traditional Bitcoin transactions, that is, the large amount of transaction data leads to slow transaction processing and high costs. To solve this problem, Bitcoin Segregated Witness was officially launched in 2017.

How SegWit works

Bitcoin Segregated Witness separates transaction signature data from transaction data, allowing each block to accommodate more transaction information, thereby increasing the throughput of the Bitcoin network. The application of this technology has greatly improved the efficiency of Bitcoin transactions, greatly shortened transaction confirmation time, and reduced transaction fees.

Analysis of SegWit utilization in 2020

In 2020, with the increase in Bitcoin transaction volume, the utilization rate of SegWit technology has gradually increased. According to statistics, as of the end of 2020, the utilization rate of Bitcoin Segregated Witness has reached more than 70%, which means that the vast majority of Bitcoin transactions are processed using SegWit technology.

Advantages of SegWit

In addition to improving transaction processing efficiency and reducing costs, SegWit also brings many other advantages. First, SegWit technology enhances the security of the Bitcoin network, effectively prevents certain attack methods, and improves the network's anti-attack capabilities. Secondly, SegWit also lays the foundation for the future development of the Bitcoin network and lays a solid foundation for the introduction of more innovative functions.

Actual case analysis

For example, suppose user A transfers 1 Bitcoin to user B. When using SegWit technology, transaction information will be more compact and occupy less space, thereby reducing transaction fees. At the same time, SegWit can also prevent certain potential double-spending attacks and ensure the security of transactions.

Future Outlook

As Bitcoin technology continues to evolve, SegWit, as an important technological innovation, will continue to play an important role. In the future, as the scale of the Bitcoin network expands, the application of SegWit technology will be more extensive, providing strong support for the healthy development of the Bitcoin ecosystem.

Conclusion

As an important upgrade of the Bitcoin network, Bitcoin Segregated Witness provides an effective solution to the bottleneck problems existing in traditional Bitcoin transactions. The utilization rate of SegWit in 2020 continued to rise, showing its huge potential and broad prospects. I believe that with the continuous improvement and promotion of technology, Bitcoin Segregated Witness will play a more important role in the future and promote the Bitcoin network to develop in a more efficient and secure direction. Let us look forward to the future of Bitcoin technology and witness a new chapter in the field of digital currency!

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What is Bitcoin Segregated Witness? How is the Bitcoin Segregated Witness usage rate in 2020? According to transactionfee.info statistics, the transaction rate of using Segregated Witness (SegWit) in Bitcoin transactions in 2019 has reached 50.5%, a record high.

SegWit is an update to Bitcoin Core that aims to reduce processing and waiting times. Initially, the update was intended to address a well-known weakness in the Bitcoin software - transaction scalability. However, SegWit provides a series of other advantages, and now the focus has shifted from fixing transaction scalability to solving Bitcoin's scale problem.

Explaining its metric, transactionfee.info pointed out that Bitcoin transactions can have multiple outputs and can therefore transfer funds to multiple recipients. The payment metric measures and adheres to the number of outputs in a transaction, and a transaction containing one or more SegWit outputs will be considered a SegWit transaction.

As previously reported, the average Bitcoin transaction fee rose by nearly 200% in April compared to March. On-chain transaction volume reportedly grew 43% in April and produced full blocks, while SegWit was close to 40% of total transactions per block, and blocks frequently exceeded the 1 megabyte block limit. The average SegWit usage rate in 2018 was 26%.

In February, Bitcoin’s daily transaction volume soared to its highest level since January 2018, just after the price of Bitcoin broke the $20,000 mark. Jameson
Lopp, CTO of Casa, a Bitcoin personal key security system company, said:

“Lower transaction demand, improved fee estimation algorithms, adoption of SegWit and transaction batching have all made block space more efficient and reduced competition for this scarce resource.”

This summer, Bitcoin Core version 0.16.1 was released, a new major version that includes “new features, various bug fixes and performance improvements, and translation updates.”

Litecoin network segregated witness usage rate

According to cryptoglobe, Litecoin.com released a report saying that the usage rate of segregated witness (SegWit) on the Litecoin network has reached a peak of 75% on September 19, 2019, just over two years after the protocol was first activated.

The report said that for most of 2019, segregated witness accounted for an average of about 50% of the network's usage.

Litecoin core developers said that the growing adoption of segregated witness (SegWit) proves LTC's innovation-oriented development goals.

It is understood that Litecoin implemented the segregated witness function before Bitcoin. Industry insiders said that in February last year, Coinbase implemented the segregated witness function, which was one of the main catalysts for the Litecoin network to add segregated witness.