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Opinion: Should Bitcoin Just Segwit?

Last Updated March 4, 2021 4:56 PM
Andrew Quentson
Last Updated March 4, 2021 4:56 PM

It has now been more than two years since the bitcoin community has been consumed by a discussion over increased capacity with miners and the wider network remaining divided, 31% choosing segwit, while 41% want Bitcoin Unlimited.

As good as all prominent bitcoin businesses and miners recently reached an agreement to activate segwit followed by a 2MB hardfork six months down the line, an agreement which has been rejected by some bitcoin developers.

That means the protocol continues to have no increased capacity, either through segwit, a maxblocksize increase, or a combination. Making it a peculiar situation where everyone wants increased capacity, but the network is somehow not getting it.

The reason why the network is not getting it is because the network is very divided. That means a hardfork would lead to a split and two bitcoins, something which would create some short term chaos as the market bets on the changed value of each coin.

Such split might be worth it if one coin follows the BU approach or uses an algorithmic blocksize, while the other coin goes the settlement way, but to split the network just to increase capacity from 1MB to 2MB doesn’t make much sense unless thereafter it has a roadmap of how on-chain capacity would be increased further to keep it above demand.

As such, since it appears unlikely segwit miners would move to Bitcoin Unlimited, thus the client may be unable to reach the 75% threshold set by some miners, wouldn’t it be better for miners to follow the roadmap laid out by Bitcoin Core developers rather than following no roadmap at all and continuing protocol stagnation?

That would mean a for-profit development company, Blockstream, would have significant influence over bitcoin, but if a significant part of the bitcoin community does not want that or does not want to continue on a full blocks network, then just fork, what is everyone waiting for?

And if the network is not going to fork, then get on with segwit. In which case, the market would have a choice over settlement bitcoin or ethereum which has plans for unlimited on-chain scalability.

What do you think, should bitcoin just segwit and everyone who wants on-chain capacity can go to ethereum or split to a new blockchain? Tell us in the poll below and feel free to expand further in comments.

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