Segwit Support

Segwit Means Faster Transactions and Lowers Fees for Bitcoin

Bitcoin, Coins, Tips

The biggest problems facing bitcoin are the slow transaction times and high transaction fees.  Segregated witness (“Segwit”) can make transactions faster and cheaper for bitcoin investors who use bitcoin exchanges and wallets with Segwit integrated.   

What is Segwit?  Every bitcoin transaction includes a sender, recipient, and the signatures (also known as witnesses).   These three elements are crammed into each block generated on the bitcoin network every ten minutes.  By some accounts, the signatures take up 65% of the transaction data in bitcoin transactions. In short, all of that signature data takes up a lot of space on each block and thereby slows down the bitcoin network.  Segwit is a bitcoin network scaling solution that separates or segregates the signatures from the rest of the transaction data.  By doing so, without getting into the technical details, blocks on the bitcoin network can include more data leading to greater transaction volumes per each block and lower transaction times.   Ultimately, Segwit may also lead to lower transaction fees when there is more room in each block for transaction data.

Why does Segwit matter? Transaction times and fees obviously matter for bitcoin investors.  Imagine you want to cash out some of your bitcoin into another cryptocurrency or U.S. dollars during a particular spike in the price of bitcoin.  Without Segwit enabled, it may take hours for your bitcoin to go from a hardware wallet to a bitcoin exchange where you can sell it. on the open market.   The spike in the bitcoin price may end by the time your transaction from a secured hardware wallet to the bitcoin exchange is processed.  Alternatively, you could pay a much higher transaction fee to push your bitcoin transaction through faster.

Who currently adopts Segwit?  It became available on the bitcoin network on August 1, 2017, but not every bitcoin exchange and wallet enables it for users.  You should support those bitcoin exchanges and wallets that use Segwit if transaction times and fees are important to you.  Learn in the above chart whether the exchanges and wallets covered in our Beginner’s Guide to Buy and Store Bitcoin currently integrate Segwit as of this posting.  However, many of exchanges and wallets below are still in the process of integrating it.