To Reduce Transaction Fee, Coinbase Plans To Launch SegWit Upgrade

Coinbase Inc. Sets To Launch SegWit Upgrade To Cut Down Transaction Fees

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  • Coinbase to launch SegWit Upgrade.
  • SegWit Upgrade will allow for faster and cheaper transactions.

San Francisco: The biggest and leading cryptocurrency exchange in US, Coinbase Inc., is making preparations to launch out a long-awaited software update “SegWit Upgrade” in a bid to cut down the transaction fees that its customers pay during transaction in Bitcoin.

Also read: The Rise Of Decentralized Crypto Exchanges

The software upgrade, tagged Segregated Witness or SegWit, was first made available in August by developers when the network was faced with congestion due to Bitcoin’s growing popularity. Tuesday, Coinbase stated in a tweet that it will begin a phased rollout over the next few days, and expects to launch the change for all customers by the middle of next week.

The SegWit upgrade is targeted at making transactions faster and cheaper by taking off some of the work from the main network. The US-based exchange has received a lot of complaints about inefficiency and high transaction fees lately, and told customers last December in a blog post that any change to its infrastructure would require adequate planning and time.

“We store billions of dollars worth of Bitcoin on behalf of customers and any change to our infrastructure is done with significant planning and consideration for the security and stability of our platform.”

Concerning the planned update, Coinbase said:

“This upgrade helps reduce the size of transactions, which improves the overall transaction capacity of the Bitcoin network. This upgrade should also help reduce the fees customers pay on bitcoin transactions.”

However, Coinbase warned its numerous customers last week that once the SegWit upgrade is activated, they will no longer be able to recover Bitcoin Cash wrongly send to a Bitcoin address. Bitcoin Cash is the split off cryptocurrency from Bitcoin in August after disagreements over how to make the network more efficient. Bitcoin, which saw a great fall in value since beginning of this year is gradually recovering and is presently worth about $11707.

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