Segwit Reading Assignment

Blockchain and Bitcoin 101
#1846
  1. Larger block size.
  2. It also solved transaction malleability by removing the signature (“witness” information) part of the transaction block.
  3. Lightning network is a second-layer protocol on the bitcoin blockchain. It was made possible due to the mallebility fix coming from SegWit.
  4. No, not all businesses or wallets have made an upgrade to SegWit since it still adheres to the previous protocol (soft fork).
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#1847
  1. Larger block sizes
  2. Segwit also solved the issue of transaction malleability, where someone can go in and alter small details that alter the transaction ID. This update removes the segregated witness data from the block, which prevents this tampering.
  3. The SegWit update allowed for new layer 2 solutions like the Lightning network by fixing transaction malleability. Both protocols aim to boost BTC’s transaction capacity.
  4. No, SegWit is only a soft fork update that is compatible with previous versions, so people/wallets/services do not have to upgrade if they don’t want to.
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#1848

Segwit Reading Assignment- Qs

  1. What was a proposed alternative to Segwit?
    To increase the block size, starting with 2MB

  2. What did Segwit solve more than just the scaling issue?
    By removing the signature and storing it separately, the transaction size is decreased as the signature contains large amounts of data and the risk of Transaction Malleability is reduced as previously, changing the signature resulted in a new transaction ID which conflicted with the original transaction ID.

  3. How is Segwit and the Lightning network connected?
    Segwit allowed the creation of a layer two solution (second layer protocol) called the lightening Network. The lightening network takes small frequent/repetitive transactions and processes them off chain.

  4. Are people, wallets and other services forced to use Segwit?
    No they are not forced but full adoption will be better for the network as it reduced fees and transaction times.

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#1849

  1. The alternative solution was to have a larger block size which eventually led to a hard-fork in the Bitcoin network known as Bitcoin Cash.

  2. It solved transaction malleability, a bug that enabled people to change small details of transactions which would result to a transaction’s id and hash value to change without its contents changing.

Additionally, it lowered transaction fees since more transactions could fit into a block than previously and paved way for further developments in projects benefitting Bitcoin’s ecosystem with layer-2 solutions such as lightening network and smart contracts.

  1. Segwit enabled development for layer-2 protocols such as Lightening network.

  2. No, considering it is a soft-fork so people aren’t forced to use it.

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#1850
  1. Making the blocksize bigger
  2. SegWit’s initial intention was to fix the transaction malleability bug in the bitcoin code. This bug allowed anyone to change small details that modified the transaction id.
  3. The malleability fix true Segwitt also made second layer solutions possible. Like the Lightning network
  4. No because it is a soft fork.
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#1851

  1. A proposed alternative to Segwit was increasing the Bitcoin block size

  2. Segwit also solved the transaction malleability issue

  3. Segwit brought support to the development of second layer protocols on top of Bitcoin, such as Lightning Network

  4. No one is forced to use Segwit, it has been gaining traction over time

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#1852

It’s time for a reading assignment about Segwit. Read through the following article https://www.coindesk.com/information/what-is-segwit , and answer the following questions.

1. What was a proposed alternative to Segwit?

Increasing the block size to 2mb by doing a hardfork.

2. What did Segwit solve more than just the scaling issue?

Also solve the problem with transaction malleability.

3. How is Segwit and the Lightning network connected?

The malleability fix solved by Segwit made any feature that relied on unconfirmed transactions less risky and easier to design, such as Lightning network.

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

No. Segwit is a softfork and the nodes are not forced to use it in transactions.

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#1853

  1. A proposed alternative to Segwit was to raise block sizes from 1mb to infinity. Other solutions included more hardware, more storage and memory along with better internet. Segwit was a no brainer.

  2. Segwit solved the issue of “Block wieght” which reduces the size of the transaction. Segwit also solved transaction malleability, a bug in Bitcoins code.

  3. Segwit supports the development of second layer protocols. They are connected off-chain and on Bitcoin’s blockchain for the settlements of transactions.

  4. No, and as a result Bitcoin forked creating Bitcoin Cash with different fundamentals. Wallets now-a-days have Segwit. This will remain until someone else further improves the system with another break thru resolution.

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#1854

1.Increase the block size from 1mb to 2mb.
2.Segwit solve the transaction ID malleability issue.
3.Segwit made relying on unconfirmed transactions less risky. And make second layer solution possible
4.No, it is a softfork.

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#1855

You can actually still use old style txs on Bitcoin :slight_smile:

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#1856

  • What was a proposed alternative to Segwit?
    Increasing the block size. This is the route Bitcoin Cash opted for, increasing the block size to 8MB in their fork.

  • What did Segwit solve more than just the scaling issue?
    Solved transaction malleability by segregating witness data from the transactions - i.e. storing them in a separate data structure. This meant that changes to witness data wouldn’t change the hash of the block the transactions were stored in, i.e. the transaction ID.

  • How is Segwit and the Lightning network connected?
    As far as I can understand, Lightning network sets up payment channels that allow bitcoin transactions to occur offchain where scaling isn’t limited by the protocol and settles them onchain periodically. LN works with unconfirmed transactions and for its payment channels to be reliablel, transactions have to maintain their integrity in terms of inputs, outputs and the corresponding transaction ID. Pre-segwit, people were able to change the IDs of unconfirmed transactions, which causes some sort of problems in the LN protocol.

I don’t really understand this interaction in detail and would appreciate if somebody can elaborate why fixing transaction malleability is important for LN to function. Did some googling and didn’t find a good answer and stuff quickly got too technical for my understanding.

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

No, segwit is backwards compatible, i.e. all nodes that updated to Segwit still accept pre-segwit block structure.

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#1857
  1. Increase the block size.
  2. Security issues.
  3. Segwit allowed for 2nd layer solutions
  4. You are not forced to use segwit. Some people have not adopted the protcol.
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#1858

Exactly because of the reason you explained. The malleability issue would be a problem for lightning because nodes on each side of the channel sign half of their commitment tx and send it to each other, but don’t broadcast it to the network.

In case malleability would still be an issue a malicious node could change the signature and post the transaction and because the other node would expect a specific txid, it wouldn’t recognize it and the malicious node could close the channel without the other node knowing, stealing the funds.

If you want to learn how payment channels work I would recommend you check out the Lightning course on the academy :wink:

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#1859

Hard fork block size increase - Bitcoin Cash

It solved the malleability transaction issue and paved the way for second layer solutions.

Segwit allowed the implementation of the Lightning network

No, wallets without Segwit support are still in use

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#1860

  1. What was a proposed alternative to Segwit?
    Increase of the block size

  2. What did Segwit solve more than just the scaling issue?
    transaction malleability

  3. How is Segwit and the Lightning network connected?
    Capability of implementinmg second layer solutions

  4. Are people, wallets and other services forced to use Segwit?
    No because it was a soft fork

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#1861

  1. A proposed alternative to Segwit was an increased blocksize (Bitcoin Cash hard fork)

  2. Other than the scaling issue Segwit solved the transaction malleability issue which allowed other to alter the transaction ID after it had been sent.

  3. Segwit and the Lightning network are connected through the second layer solution.

  4. No. It is an option not mandatory.

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#1862
  1. Increased blocksize - Bitcoin Cash.
  2. Transaction malleability.
  3. Segwit supports the development of the second layer protocols, such as the lightning.
  4. No.
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#1863
  1. What was a proposed alternative to Segwit?

Increasing block size rather from 1MB to 2MB. Argument against this, the blocks would continue to reach max capacity and would the size would continually have to be increased. Also, this would not solve longer transaction times because sending a larger amount of data takes longer.

  1. What did Segwit solve more than just the scaling issue?

It also solved the problem of transaction malleability. It did so by removing the scripsig from the transaction data. By doing so, attackers could not alter the scripsig in a transaction in order to create a new Tx hash( transaction ID) and thus make a confirmed transaction nonexistent. Since the scripsig is stored separately, altering it would have no effect on the Tx hash.

  1. How is Segwit and the Lightning network connected?

Segwit supports the development of the lightning network because it supports the development of second layer protocols. Segwit made it easier and less risky for protocols that relied on unconfirmed transactions to operate. Thus, spawning the Lightning Networks solution of taking smaller and more frequent transactions off-chain, waiting to be added to the BTC blockchain when the network was ready.

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

No they are not forced to use the Segwit structure however; most have adopted it because of its many advantages to the BTC Network.

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#1864

  1. The first alternative for SegWit was to increase the 1mB limit.

  2. Besides of the scaling issue, SegWit also solved the malleability problem, by removing the signatures from the transaction block.

  3. SegWit supports the development of second layer protocol, such as the lightning network.

  4. No, they are not forced to use SegWit, because, by being a soft fork, the previous protocol is still compatible with the new one.

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#1865
  1. Increased block size. (BTC cash)
  2. Fixed transaction malleability, which allows for more scaling and things like lightning network.
  3. A second-layer protocol that builds on segwit that allows for more transactions/second.
  4. Is optional. (Soft Fork)
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