SegWit (Segregated Witness)

Category: infrastructure

A protocol upgrade that split transaction signatures from transaction data to increase block capacity and fix transaction malleability.

Activated in 2017 (BIP 141), SegWit structurally separates the "witness" (signature) data from the base transaction data block. This allowed more transactions to fit into the same 1MB block space and paved the legal way for Layer-2 scaling solutions like the Lightning Network by ensuring a transaction hash cannot be subtly modified before confirmation.

Common Examples

• By switching our address generator to Native SegWit formats, we cut our outbound transaction fee overhead by over thirty percent.
• SegWit resolved the transaction malleability bug, making off-chain smart contract structures safe to deploy without risk of settlement hijacking.