Coinbase just made an announcement, saying that the site will be now implementing SegWit on their Bitcoin deposits and withdrawals. The transition is currently being implemented and will probably be finished until the end of the week.
According to experts, SegWit should improve the transaction speeds and result in lower fees on the platform. Ever since it was introduced (August 2017), the technology has made a lot of headlines. And even though Coinbase was slow to adopt it, it is about time they did something to prioritize the implementation over other upgrades.
https://www.twitter.com/coinbase/status/967084664962928641
Basically, Segregated Witness (or shortly SegWit) is an improvement to the Bitcoin protocol that reorganizes the structure of blocks and is known to reduce the space taken on the blockchain by the transaction and witness data. This results in better transactions and a blockchain technology that is more efficient and cheaper to use.
So far, the Bitcoin Core wallet upgraded to allow SegWit (this week). After that, Bitfinex stated that they are now using the technology on Bitcoin transactions as well. As said in Bitfinex’s blog post:
“We are delighted that through this implementation we can provide our customers with bitcoin withdrawal fees that are up to 20 percent lower, as well as faster-than-ever transaction speeds.”
Still, Coinbase were not so jubilant about the entire upgrade. Instead, they warned users to not confuse Bitcoin and Bitcoin Cash deposit addresses. As they said in their post:
“While SegWit should help reduce fees, once we begin rolling out this change, if you incorrectly send Bitcoin Cash (BCH) to a Bitcoin (BTC) address, your funds will not be recoverable. Sending the incorrect digital assets to a deposit address will result in permanent loss. “
At this point, what’s important is that Coinbase’s adoption of SegWit will increase the speed of the Bitcoin network – and hopefully – drastically lower the fees.
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