Segwit Reading Assignment

Blockchain and Bitcoin 101
#763
  1. increase the block size
  2. it solves transaction malleability
  3. Segwit supports the use of the Lightning network, a second layer protocol
  4. no
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#764

  1. The propsed alternative was simply to increase the block size from 1MB to 2MB creating a had fork.

  2. The main issue it set out to solve was the bug in the design which was transaction malleability, which in turn solved the scaling issue.

  3. Segwit supports the lightning network by helping them create a second layer protocols.

  4. As the update is a soft fork, and Segwit doesn’t tamper with the structure in a divisive way, it doesn’t really affect anyone therefore change is optional.

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#765
  1. An alternative was to increase in block sizes to capacities greater than one mB. The pursuit of this alternative led to the Bitcoin/Bitcoin Cash hard fork.
  2. Segwit not only solved the scaling problem (at least temporarily and to a certain extent) but also the problem of transaction malleability by separating the transaction signature from the actual transaction. That is to say, in the segwit protocol the hash of a transaction is generated strictly by the transaction data itself and is therefore not altered when small changes are made to the signature. Thus it is no longer possible to change a transaction hash by slightly changing the transaction signature (while leaving the actual transaction data intact) and then to claim dishonestly that the transaction in question was never received.
  3. The segwit elimination of the malleabilty problem makes the imposition of second-layer structures, such as the lightning-network structure, upon the bitcoin blockchain less risky. So segwit is an important intermediate step in the construction of the lightning network.
  4. No, they are not. I myself am still using in my transactions the classic bitcoin protocol. I could switch to segwit, but given my limited transaction volume, it doesn’t really seem to make much of a difference.
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#766

  1. Raising the block size.

  2. The transaction malleability bug.

  3. Lighting network technology depends on moving bitcoin while the transaction is initially unconfirmed on chain. Without segwit unconfirmed transactions could be exploited by an attacker via the transaction malleability bug.

  4. No

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#767
  1. increase the size of the Block (move to 2MB)
  2. TX malleability
  3. Segwit fix the TX Malleability issues and hence enable Lightning network, i.e. TX are lighter and hence more transactions / lighter network
  4. No - it is an adoption process and some didn’t follow (e.g. Bitcoin Cash)
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#768

You could for example lock bitcoins with a puzzle.
But bitcoin core implementation will not allow it in the mempool, because non standard scripts can have heavy computational stuff. So to prevent spamming. But in case a miner includes a transaction with non standard scripts, it is perfectly valid.

Watch this amazing presentation about Bitcoin script! He also explains non standard scripts. (45:31)

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#769

Thanks Fabrice. This was very helpful !
Basically i had some misconceptions in my head.

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#770
  • What was a proposed alternative to Segwit?

Bitcoin Cash, instead of using segwit, it instead increased the block size capacity to 8MB.

  • What did Segwit solve more than just the scaling issue?

It also solved transaction malleability which Segwit was initially designed to do. The original purpose or use case for Segwit was moving the signature to prevent malleability. The added benefit was a lighter block that was able to store more transactions.

  • How is Segwit and the Lightning network connected?

Segwit solves the issue of malleability which makes working with unconfirmed transactions less risky. With the issue of malleability out of the way, it allows the Lightening Network to safely take transactions off chain.

  • Are people, wallets and other services forced to use Segwit?

No, since it’s a soft fork, Segwit is still compatible with previous protocol.

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#771

  • What was a proposed alternative to Segwit?
    Making bigger block than actual 1MB. That would lead to hard fork.

  • What did Segwit solve more than just the scaling issue?
    Segwit fixed transaction malleability by removing the signature information.

  • How is Segwit and the Lightning network connected?
    Segwit supports second layer protocols like lightning network.

  • Are people, wallets and other services forced to use Segwit?
    no

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#772
  1. The alternative to Segwit is to make the block size bigger, thus creating a hard fork. Bitcoin Cash is using this solution by increasing the block size from 1 Mb to 8 Mb.
  2. In addition to solving the scaling issue Segwit also fixes a flaw in Bitcoin´s protocol that allowed users to manipulate the transaction identities.
  3. Lightning network is running on top of bitcoin (a second layer protocol), increasing the bitcoin transaction capacity by taking small transactions off-chain.
  4. No, people, wallets and other services are not forced to use Segwit since it is not a fork. It is a feature.
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#773
  1. An alternative to segwit would be a hard fork.
  2. Segwit solved transaction malleability.
  3. Segwit supports second layer solution.
  4. No it is optional.
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#774

1. What was a proposed alternative to Segwit?
The alternative was to increase the block size, but the the arguments against this were twofold:

  • Miners would have needed a hardware upgrade - more storage, memory, better internet connection. This would have cut out smaller miners who weren’t able to upgrade.

  • An increase in block size would have meant that it takes longer for the blocks to propagate through the network, increasing risks for stale blocks and forks due the the time increase.

(On a side note, now that BCH has been going since 2017, did these issues materialize in practice?) @Mauro or @filip perhaps you could help with this one?

2. What did Segwit solve more than just the scaling issue?
Segwit was created primarily to solve the transaction malleability issue, making the network more secure from transaction ID exploits.

3. How is Segwit and the Lightning network connected?
With the transaction malleability issue, it was possible to change the transaction ID before it was confirmed on the blockchain by a miner. This made it incredibly difficult to build the lightning network within this environment. So when Segwit was introduced, it solved the malleability issue and enabled 2nd layer protocols such as Lightning Network, amongst others.

4. Are people, wallets and other services forced to use Segwit?
No, but there is an incentive for using Segwit which can be illustrated by the principles of supply and demand; if a block can only support a few transactions but the count in the mempool is high, then the demand is high and the supply is low. This drives up price as miners will pick the top paying transaction fees only. If miners can fit more transactions on the block, it will mean that there is more available supply and the fees will consequently be lower since they can accommodate more on the block (and because of satoshis per byte fees). This is evident when comparing tx fees from legacy and segwit addresses.

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#775
  1. Increase the block size from 1 MB to 2 MB or more.
  2. It also resolved transaction malleability, which allowed someone to alter the transaction after it’d been sent in minor ways to, in turn, change the transaction ID.
  3. Segwit makes layer two solutions, like the Lightning Network, easier to design and less risky because of the malleability fix.
  4. No, it’s a soft fork, so it still falls within the rules before the update.
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#776

1 A proposed alternative was increasing the blocks size (hard fork).
2 It solved the problem of malleability and id modification making finally the transactions more secure.
3 thanks to the improved security of segwit it has been possible to develop a 2nd layer solution which is the lighting network.
4 No it’s not mandatory (because it’s a soft fork) but its use is diffusing widely.

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#777
  1. Increased block size limit.
  2. It also solved the issue of transaction malleability because the signature data could be changed without changing the content of the transaction.
  3. Segwit supported development of the lightning network because it made it less risky to deal with unconfirmed transactions.
  4. People are not forced to use Segwit, as it does not create a hard fork.
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#778

What was a proposed alternative to Segwit?

  • Segwit works on decreased transaction size so more transactions can fit in the 1MB block size. The alternative is to increase the block size.

What did Segwit solve more than just the scaling issue?

  • Segwit takes signature out of transactions therefore it solves the malleability of transaction because transaction ID will not changed if the signature got altered.

How is Segwit and the Lightning network connected?

  • Segwit makes transactions lighter so it enables faster processing

Are people, wallets and other services forced to use Segwit?

  • No, because Segwit is proposed as a soft fork (backward compatible) so the choice to use it depends on people see the benefits.
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#779

  1. A proposal for Segwit was to increase the size of the block from 1MB to 2MB (Hard Fork update) which was not agreed by the community and several coins were created diverging path from Bitcoin original code (ie: Bitcoin Cash).

  2. It solved a problem of block size, but also the transaction malleability issue.

  3. LN is a decentralized network that uses smart contracts functionality in the blockchain to enable instant payments protocol. It woks as a second layer protocol based on Sigwit.

  4. No, Soft Fork update requires only 51% of the network update (not mandatory for all) and the worst case is that several blocks will have less transactions since not everybody is using Segwit.

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#780
  1. An increase of the block size
  2. The signature malleability. Meaning that the signature couldn’t be changed anymore retrospectively.
  3. Lightning network is a second layer solution build on top of the segwit btc blockchain. It allows for unconfirmed settlements and it therefore much quicker. But with signatures that can be altered it wouldn’t have been safe.
  4. No, it’s a soft fork. The old transaction type incl. signatures are still accepted
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#781
  1. The proposed alternative to Segwit was to increase the Block size to 2 MB.
  2. Segwit solved a bug in the bitcoin code that could cause modified transaction IDs (malleability).
  3. Lightning is a second layer solution that heavily relies on unconfirmed transactions. The melleability fix made it less risky to use second layer solutions.
  4. The Segwit Update was a Soft Fork, therefor people, wallets and services were not forced to implement it.
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#782
  1. Increase in size of the blocks.
  2. Fixed malleability issue where signature has been removed from tx’s data structure and its no longer part of tx’s ID/hashed data.
  3. Lightning network build separately on top of the BTC network and allow faster payments and lower fees.
  4. Not necessarily as it’s still within the rules so old addresses and tx’s can be used.
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