segregated witness it's been hailed it
as bitcoins great-aunts that sets out to
fix a plethora of issues for
malleability all the way through to
scaling it hasn't however they met that
resistance from miners who are currently
threatening its activation due to
concerns they have raised regarding its
technological and economic complexity in
the hopes of finding a better solution
segregated witness or segwayed as it is
otherwise known is a fundamental change
with alters the structure of blocks on
the blockchain blocks are made up of
multiple components they are the block
header which itself contains the block
version previous block cache merkel
route timestamp target and nonce a
transaction counter and finally a list
of individual transactions a block is
currently limited to one megabyte in
size and each component has its own size
which takes up space within that block
the majority of space well over 99% is
taken up by transactions which
themselves have their own components
namely the inputs and outputs inputs
being where coins are coming from and
outputs being where they are going to
the majority of space within a
transaction is taken up by a signature
that is located in the inputs this
signature accounts for around 65% of the
space within a single transaction and
acts as proof the B sender controls we
required funds to make for payment
segregated witness segregate and
relocate this signature from within the
input to its own structure towards the
end of the transaction
known as the witness this makes
calculating the transaction ID much more
predictable and in some cases but not
all completely prevents transaction
malleability at tags when individual
attempts to change the transaction ID it
also allows for an increase in the block
size limit from one megabyte to just
under 4 megabytes as every byte in a
witness for a segment enabled
transaction counts as one unit of weight
whilst every other byte within a
transaction counts as four units
however since blocks aren't comprised of
100% witness data and there are
additional size increases on segway
transactions it is never going to reach
four megabyte and instead be effectively
capped at around two megabytes or double
the current capacity taking these
signatures out of the transaction inputs
does however create its own
compatibility issues the merkel route
found within the blocks header is a
structure that allows Vblock to verify
transactions without requiring the main
bulk of the transaction information it
is created by taking every transaction
ID in the block and twice hashing them
together in what is known as a Merkel
tree until one number remains the Merkel
route the witness data is no longer a
part of the transaction ID but still
needs to be included in the transaction
otherwise the block will not be valid
therefore a separate Merkel tree for the
complete transaction data is needed by
attaching this to the first transaction
it successfully connects the witness
data and the transactions together and
allows segregated witness to become
backwards compatible due to this new
block structure older nodes will still
accept these as valid although as with
any upgrade to Bitcoin itself it won't
fully understand them however newer
segments enabled nodes will be able to
properly validate these blocks as
they'll be made aware of the new rule
set and be able to recognize this new
block structure segregated witness is
being implemented by a soft fork which
means in order for it to be actually
activated on the network 95% of Myers
have to be running segregate all
software and whilst we don't know how
many mine is actually running seg wit if
node R anything to go by only around 85%
of the network of running core nodes
which are the main proponent of segwayed
this has led many people to predict bits
egg wit will never successfully reach a
consensus in order to be activated and
others to be quietly confident but I
have a given time by the end of the year
or in 2017 Aitken centers will
successfully be read as its support is
currently underestimated it is only
right to point out that Segway is very
much a foundational change but lays the
groundwork for
further changes down the road it is not
just concerned with malleability and
network capacity due to this fundamental
change VAR a handful of risks including
one the introduction of bugs into the
system either with mistakes in its
design or implementation those also the
possibility of user error surrounding
confusion and usage of this new system
along with various ecosystem
interactions where Bitcoin may already
have some hard-coded assumptions which
will then be violated due to this new
update to transaction fees quite often
as is the case now demand outstrips
supply as such those who pay more in
transaction fees or prioritized
over those who don't by increasingly
network capacity at least in the short
term we could see these transaction fees
reduce in size therefore less money for
miners and less security on the network
if they can't afford to mind a profit
and a forced to search some Ram machines
down although as will potentially be the
case these transaction fees will either
continue to rise or appie their release
stay the same as the additional capacity
offered by segwayed is quickly filled up
due to the sheer demand on the network 3
serialization transactions and blocks
are currently serialized in order to
allow their information to be
reconstructed later on if necessarily
required this also helps with the
stalling of the blockchain and the
transmission of its data over the
network
segways FX's in a couple of ways by
adding a note to be coinbase transaction
of the blog which adds a further 38 to
47 bytes of information and depending on
the transaction type a further minus 1
to 19 percent of information per
transaction for block validation time
the time it takes to validate a block
will also increase due to the additional
processing power required to deal the
new Segway type transactions and the new
witness data Merkel tree however it is
expected to be negligible and should add
at most a further 7 kilo
information to a block or around 1/10
the second on capable hardware five
technical debt segregated witness could
potentially add to the already growing
amounts of technical debt within Bitcoin
technical debt referred to code may be
implemented now but can cause some
serious issues further down the line
Reviva it needing to be rewritten which
can slow down development time due to
the Cobra cling more fragile or in some
cases with it being retained
indefinitely as a poor design choice as
touching it could cause users to lose
access to the coins they own if it was
later changed six larger blocks was open
a faster growing UTX o or unspent
transaction output database this
database is important because it allows
nodes to fully validate and check
transactions if an input is not present
in which database and it means the
transaction is not valid the UT XO
database is expected to grow regardless
of seg weight and its current size
sitsit about 1.5 gigabytes or 10
gigabytes went uncompressed into a
computer's memory if you were to feel so
inclined for some reason
undersecretary would expect this
database to grow about twice as fast
that's not really an issue until you
realize that everyone has to buy the
computer parts required in order to
store it as such in the long run
stalling and actually holding this
information for many people may just
become unfeasible and as such will
result in greater centralization on the
network 7 long term scaling while
segregated witness is a one-time
increase in the network capacity it is
not a long term or medium term solution
to the scaling issue it does however
enable layer 2 networks as well as fix a
quadratic sig hash scaling bug which
could help reduce the negative impacts
of future scaling development when they
eventually happen P reviews and tests
have of course been carried out by many
groups of people to try and dine out any
issues with a full
liquid lease and the core developers
have been rather transparent in listing
all of these issues on their side along
with how they plan to address every
single one of them however unlikely they
are to arise however there is still
those core developers and key public
figures believe one way or the other in
this matter and each has his or her own
reasons for doing so
including people such as Jameson lob of
bit Co who argue it is a moral duty to
keep the network running like a
well-oiled machine others have suggested
because if people continue to dig their
heels in on topics such as segwayed they
should be left behind this would include
not putting it up to the actual vote but
opting for a non backwards-compatible
method of upgrading otherwise known as a
hard fork although there are many other
reasons to perhaps choose a hard walk
over a soft four in this situation
although it's a shared belief amongst
some developers but no one individual or
group has the authority to make this
change and forced upon the network which
is what a hard walk would entail unless
a significant amount of the user base
agrees with it Bitcoin developer Jeff
Kasich argues it's egg weight and its
insistence on being implemented via a
soft fork will only create an overly
complex system but does not offer enough
user benefit in return an overhand
Bitcoin developer Luke - jr. argues that
the only way a harmful could
significantly improve on sacred would be
by breaking compatibility with existing
wallets including permanently destroying
any bitcoins that may be locked up until
after any proposed hard fork there are
of course alternative solutions being
worked on most notably flexible
transactions or Bitcoin improvement
protocol one three four by Tom Zander
which again isn't without its detractors
but it also has its own supporters band
we may touch on it further another time
if segwayed does end up having support
issues it may gain more prominence as a
possible answer to bitcoins problems
then again there is also the suggestion
of a repurposing segment without B block
size increase allowing it just
the other more welcome and less
controversial changes it brings voting
the segment will begin on the next
difficulty change which should be the
18th of November from that point on it
has one year to successfully reach a
consensus
if a consensus is not read for the Miss
time period seg wit in its current form
will not be activated and the Bitcoin
network will buy itself back in the same
position it originally started but in
need of a new solution a big thank you
to Luke - jr. of Bitcoin core and Tom
Zander of Bitcoin classic by helping me
write and source this video they were
very helpful they may be two sides of
the same coin but their insights were
very much appreciated you can find links
to them as well as their respective
projects including Bitcoin knots which
is Luke's version of Bitcoin featuring
all these own improvements and Tom's
flexible transaction concept in the
description below along with all the
sources of this video so please do check
them out be sure to subscribe and as
always I will see you next time