With Bitcoin’s spike in usage, transaction fees were climbing higher and higher so that miners will confirm the transactions. SegWit, which happened in August 2017 alleviated these problems. Bitfinex, one of the largest cryptocurrency exchange, recently confirmed that it has adopted SegWit. Coinbase is confirmed to follow soon.
Benefits from SegWit
A non-SegWit transaction can cost users about 0.00115034 BTC for 1 input and 2 outputs at 226 bytes. Using a SegWit transaction with the same input and outputs will only cost 0.00089584 BTC because SegWit (Segregated Witness) reduces the size of the transaction. From the original 226 bytes, it will go down to 178 bytes.
With more and more companies adopting SegWit, it will increase the transaction capacity per block and will also reduce congestion, and further decrease the fees.
Bitfinex and SegWit
Bitfinex is a popular cryptocurrency exchange, with around $1 billion trades happening per day. For Mr. Paolo Ardoino, CTO of Bitfinex, SegWit allows the exchange to deal not just with transaction speed and fees but also with total network capacity. This move allows Bitfinex users to experience 20% lower withdrawal fees.
Coinbase and SegWit
After Bitfinex’s announcement, Coinbase also announced that they are also rolling out SegWit in the next few days.
The more the community uses SegWit, the cheaper (transaction fees) and faster it will be. Reports suggest that in the past few days, transaction fees are becoming lower thanks to the SegWit adoption.
Both Coinbase and Bitfinex can be accessed in the Philippines. Coinbase can be used in the country to store bitcoins. Although, the feature to directly buy bitcoins from Coinbase isn’t available.