How does segwit help to reduce transaction fees in digital currencies?

3 answers

• Sevo YektirDec 21, 2020 · 5 years ago
  Sure! Segwit, short for Segregated Witness, is a protocol upgrade implemented in certain digital currencies like Bitcoin. It helps to reduce transaction fees by changing the way transactions are stored in blocks. With segwit, transaction data is separated into two parts: the transaction information and the witness data. The witness data, which includes the digital signature, is moved outside of the transaction block, allowing more transactions to fit into a single block. This increases the capacity of the blockchain, leading to faster and cheaper transactions.
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• ru allenApr 25, 2024 · a year ago
  Segwit is like a magic wand for reducing transaction fees in digital currencies. It optimizes the way transaction data is stored, making more efficient use of block space. By separating the witness data from the transaction block, segwit allows for more transactions to be included in each block. This means that miners can process more transactions at once, resulting in faster confirmation times and lower fees. It's a win-win for users and miners alike!
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• Battle DamborgAug 24, 2023 · 2 years ago
  Ah, segwit, the hero of reducing transaction fees! With segwit, the witness data is stripped out from the transaction block and stored separately. This not only increases the capacity of the blockchain, but also reduces the size of each transaction. And you know what that means? Lower fees, my friend! So, next time you're making a transaction in a digital currency that has implemented segwit, you can expect to pay less in fees and have your transaction confirmed faster. It's a game-changer!
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