TL;DR: Segregated Witness (SegWit) transactions rose above 50% recently. “In fact,” Sergej Kotliar, CEO of Bitrefill noted, “the number of bech32 transactions increased 100-200% [….] It turns out there’s only one entity that does on the order of 50k transactions per day [on SegWit]. And brags about it.” That entity is VeriBlock, Kotliar confirmed.
VeriBlock Responsible for 50K SegWit Transactions Per Day
SegWit was among the proposed solutions to be crafted during the landmark, early Bitcoin network scaling debates. Its success has been shaky, and proponents are often keen to latch onto any uptick in traffic or associated address usage as proof SeqWit was worth all that past controversy. In recent weeks, things seemed to be picking up concerning its organic adoption, or so some thought.
“So it turns out (not so surprisingly) that spammers are abusing #Segwit’s block size increase to gain an advantage over legit #Bitcoin users,” BTC Core developer Luke Dashjr fumed at Kotliar’s revelations. “Reducing the block size limit could rebalance this unfair advantage / bad incentive Segwit has created.”
Enthusiasts defended the transactions, suggesting VeriBlock’s are as valid as any other, racking up requisite fees. Others acknowledged Dashjr’s concern, but stressed it’s not really a problem at the moment, and assumed VeriBlock-like transactions would decrease when inevitably BTC fees increase. “It has been a real problem for years,” Dashjr responded. “The only argument against fixing it that *might* hold up is that it may be beyond repair.” He then floated his pet theory of how “256 kB seems like a good round size, and might help mitigate the delay in reducing block sizes. Maximum size that can reasonably fix the Segwit incentive problem is around 500k, though.”
For its part, VeriBlock explained its “PoP miners will still use the same amount of weight in each Bitcoin block, and will use more on-disk space, because each weight unit they purchase corresponds to more on-disk bytes than before.” This comes after developer Jameson Lopp discovered something similar back in early January of this year. “Source of the now-highest volume of OP_RETURN outputs has been identified as @VeriBlock [POP] miners. They are creating around 20% of all BTC transactions now. Seems inefficient to me; will be interesting to see if the incentives work long term.”
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