BIP91 locked in, Prices Advance
The long debate over Bitcoin scaling is moving toward resolution as more than 80% of the miners are signaling support for BIP91. If this holds, and it likely will, Bitcoin will adopt Segregated Witness via SegWit2x before the August 1st deadline (Update: As of midnight July 21st, BIP91 is locked in). Not surprisingly, Bitcoin prices have advanced on the news, shortly breaking $2,800. Other cryptocurrencies have also seen price increases.
Concern briefly gripped the Bitcoin community last week when miners missed the BIP148 deadline, which if adopted would have also triggered SegWit. This deadline failure was not entirely unexpected as the threshold for adoption was much higher. By the weekend, strong support for BIP91 became evident. Now that adoption has crossed the 80% threshold, it will become locked into the protocol once 336 blocks have been mined (its activation period). Should everything remain as-is, the network will soon begin to reject blocks that do not signal support for SegWit.
Bitcoin’s scaling issue has been known for more than two years, but developers have been fiercely divided over a solution. All agree, however, that the current protocol is in need of improvement. Heavy traffic has slowed confirmation times, causing many to question Bitcoin’s overall utility as a currency. Also, newer crytpos contain features Bitcoin lacks. Notably, Ethererum’s ability to run smart contracts gives it a significant advantage.
Segregated Witness fixes Bitcoin’s growing pains, but is controversial. Notably, critics assert that it weakens security and modifies the code in ways never intended by its designer. The current version of Segregated Witness is a compromise designed to please different members of the development community. Despite concerns, support for SegWit2x adoption has increased as other crytpocurrencies have gained in value and become threats to Bitcoin’s dominance. Also, Litecoin, which is almost identical to Bitcoin, successfully adopted its own version of SegWit earlier this year. �
The adoption of BIP91 is happening earlier than necessary. It could be delayed until July 29th and still succeed. Even if it were to fail, there are other means by which a chain split can be avoided. The fact that the miners are implementing it earlier clearly indicates that most of the Bitcoin community is primarily concerned with maintaining Bitcoin’s stability, and avoiding a split. It also demonstrates that Bitcoin’s decentralized nature is not a barrier to future development and upgrade.
Updated to reflect BIP91 locking in with block 476,769 (0:13 UTC, July 21st).
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