Bitcoin segwit upgrade threshold reached

Bitcoin fees

Scalability debate surrounding Bitcoin that has been raging on for more than two years could finally come to an end as the Bitcoin segwit upgrade threshold of 80{7b1a8a58d3ffe2d8e535e80e794d8bc0bf06a3ecc0c2050b83ca37784c6fddca} has been breached.

According to reports 80.5{7b1a8a58d3ffe2d8e535e80e794d8bc0bf06a3ecc0c2050b83ca37784c6fddca} of bitcoin’s mining hashrate is currently voting for segwit. The surpassing of the threshold means that all miners will likely upgrade. The chances for an upgrade are very high if the current miners who are backing the upgrade continue to back segwit. If this happens, the upgrade will activate and go live in the next two-three weeks.

Once the upgrade is live and rest of the infrastructure has upgraded alongside the upgrade, bitcoin’s capacity should increase, nearly doubling from its current 300,000 transactions a day to 600,000.

Subsequent to this upgrade, developers have plans to increase the capacity further by compressing transaction data, while also awaiting the launch of the Lightning Network (LN) which will allow bitcoiners to transact with each other through intermediaries. As much as bitcoiners will like to transact using LN, it is still under development, with coders trying to figure out how to connect end-points, technically called routing.

But the upgrade should give bitcoin some time before it reaches full on-chain capacity, allowing all to see how the network will work as well as evaluate LN’s usability.

There’s a group though that is willing to wait because according to them segwit intentionally keeps on-chain capacity limited by allowing only 1.7x more than the current level of transactions instead of the 4x their proposal allows. They are leaning towards splitting to Bitcoin Cash under the ticker of BCC supported by two clients, BitcoinABC, which is already live, and Bitcoin Unlimited, which is soon to provide a client compatible with BitcoinABC.

Their code allows for a chain-split without changing Proof of Work. Instead, it gradually reduces difficulty if necessary. If successful, they will create their own chain, with their own nodes, miners, and their own coin.

That coin is very likely to start as a minority coin as segwit is keeping the bitcoin brand and the BTC ticker. BCC, therefore, will have to be added to the wider infrastructure just like any other coin. But it will probably have some value. At what level or to what proportion with bitcoin no one can quite say, but a good guess might be that one of them will settle at around 20{7b1a8a58d3ffe2d8e535e80e794d8bc0bf06a3ecc0c2050b83ca37784c6fddca}, at least eventually.


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