Exchange and wallet service Coinbase together with its professional trading platform Global Digital Asset Exchange GDAX have announced full support for Bitcoin Segregated Witness (SegWit) transactions. As it has become known, over the coming days, support for SegWit transactions will be available for 100% of the platform’s users.
Some weeks ago, Coinbase disclosed its plans to implement SegWit for Bitcoin in 2018 with a view to make Bitcoin transactions cheaper and faster. And it hasn’t taken long to implement these plans into practice. By redefining the structure of blocks, SegWit upgrade greatly contributes to reduction of Bitcoin transactions size, which, in its turn, improves the overall transaction capacity of the Bitcoin network. Moreover, it helps to minimize the fees that customers should pay for Bitcoin transactions.
Despite the fact that Coinbase is one of the most popular cryptocurrency exchanges, it has been widely criticized for its slow progress towards SegWit implementation, as the technology was already introduced in August, 2017. So, support for SegWit is really a long-awaited and highly-demanded company’s move, esp. given that the petition calling for the exchange platform to prioritize this upgrade over others was signed over twelve-thousand times.
Though Bitcoin’s sky-high prices in December were followed by a huge wave of debate and discussions over its long-term potential, it is quite interesting to observe that transactions fees are now dramatically lower than December peaks. In dollar figures, we can see that December’s peak average fee was $37.49 but the early February’s peak amounted to $4.35. It is expected that the arrival of SegWit will help keep the transaction costs low.
However, as SegWit no longer shares the same format as Bitcoin Cash (BCH), the company also warns its users that due to the upgrade, in case they incorrectly send Bitcoin Cash (BCH) to a Bitcoin (BTC) address, there won’t be a possibility to recover funds. So, mistakes in sending digital assets to a deposit address will result in permanent losses.
Moving forward, both GDAX and Coinbase shared their commitment to adopt additional solutions for the Bitcoin network with a view to enhance Bitcoin scalability. Among these improvements will be transaction batching and UTXO management that will contribute to users’ fees reduction. Moreover, the company is working on adoption of the Lightning Network solution on its platforms.
Let us also remind that Coinbase is not the only platform supporting the technology – last week it became known that another major cryptocurrency investment platform Bitfinex had announced its adopting support for SegWit protocols for Bitcoin traded on the exchange.
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