Author: Matt Corallo 2015-12-16 22:32:57
Published on: 2015-12-16T22:32:57+00:00
The responsibility of the ecosystem is to ensure that actions taken do not result in people losing money without providing them with enough opportunity to fix it. Running a full node in Bitcoin provides reasonable security against accepting invalid transactions. Segregated Witness (SegWitness, SW) is being presented as a solution to Scaling Bitcoin. It has useful attributes, including addressing a major malleability vector but is not a short term scaling solution. One proposal presents SW in lieu of a hard fork block size increase. SW creates two views of each transaction and block, which are rendered to clients depending on compatibility level. Older clients see blocks with limits up to 1M and do not see extended blocks. Each extended transaction exists in two states, one unsigned and one signed, each of which passes validation as a valid bitcoin transaction. Transactions created by older clients will not use the extended transaction format. SW complicates block economics by creating two separate, supply-limited resources.The core block resource is heavily contended, with older clients using them exclusively and newer clients storing data in extended blocks. It is presumed that older clients will pay a higher fee than newer clients due to the contention for core block space. The pace of roll-out for Segregated Witness (SW) as a soft fork must consider the whole ecosystem beyond the estimated months for soft fork speed, including updating bitcoin-core and bitcoinj, upgrading wallet software and programmer libraries, and creating extended transactions.A hard fork such as BIP 102 is automatically compatible with most software, while SW requires immediate upgrades for merchants and peripheral software. Splitting blocks into two pieces creates two fee markets, which introduces new economic complexities and risks. The current SW mining algorithm needs improvement, and there are new under-analyzed attack surfaces. In conclusion, it seems unlikely that SW provides scaling in the short term, and a "short term bump" hard fork block size increase addresses economic and ecosystem risks that SW does not. Bump + SW should proceed in parallel as orthogonal issues. Hard forks provide much stronger validation, and an SW hard fork could also add several zero-filled placeholders in a merkle tree for future use.
Updated on: 2023-05-19T22:51:10.607622+00:00