The discussion regarding the Bitcoin block size might be coming to an end very soon. The proposal made by Gregory Maxwell earlier this month is getting a lot of support from Bitcoin contributors, and now that the roadmap has been released, things make a lot more sense. Some interesting features are on the roadmap, which will be beneficial to the Bitcoin ecosystem as a whole.
Segregated Witness And Bitcoin Block Capacity Increase
As soon as the topic was raised to increase the Bitcoin block size, the digital currency community split into several camps. On the one side, there are those who want to increase the block size by quite a margin, although it is not really needed to go to extreme lengths just yet. A more scalable solution is what most people are after, but it is hard to come to a consensus on different proposals.
Segregated Witness, as the proposal by Gregory Maxwell is called, seems to be the solution that will be implemented eventually. Although this concept sounds very complex on paper, the main thing to keep in mind is how this solution will gradually increase the Bitcoin block size over time. Additionally, there is no need to prepare the ecosystem regarding compatibility, as Segwit can be deployed incrementally.
But there is more, as the segregated witness solution does not require existing applications to change their code either unless they want to take advantage of new features. Last but not least, transaction fees will be lowered, and support for multi-stage smart contracts and bi-directional payment channels will be made available, while not bloating the Bitcoin blockchain.
The only parties involved who are advised to upgrade as soon as possible are the Bitcoin miners and wallet providers. Although this latter category does not need to upgrade if they don’t want to, as segregated witness will not break backwards compatibility. All in all, this solution seems to please all parties.
What Can We Expect Over The Next Few Months?
During the month of December 2015, the segregated witness testnet will be deployed. It is important to note this is not part of the regular Bitcoin testnet. This deployment gives Bitcoin Core contributors a chance to play around with segwit, and for wallet creators to make necessary preparations to upgrade their services.
One of the most interesting features – other than the incremental block size increase – is the Libsecp256k1 verification. To put this into layman’s terms: there will be a major speed boost on x86_64 hardware when verifying full nodes to join the network, as well as lighten the burden on the existing Bitcoin nodes. More nodes mean a stronger and more decentralized Bitcoin network, and anything to make that process smoother is more than welcome.
April 2016 will be the time when segregated witness is fully deployed on the Bitcoin network. Block sizes will be subject to a direct capacity upgrade of up to 400%. Furthermore, this deployment puts an end to third-party malleability hurting smart contract deployment. Do keep in mind this is a tentative schedule, as all of the code has to be well reviewed before deployment.