Binance, one of the world’s largest platforms for exchanging cryptocurrencies by volume, has integrated Segregated Witness or SegWit to support Bitcoin (BTC) deposits.
Binance said in an official statement that SegWit support has expanded to deposits on Christmas Eve. Updating the protocol was originally only allowed for withdrawals.
Immediately thereafter, Binance users can transfer money to the SegWit address (bech32), specifying the BTC network (SegWit). Binance explained:
Please note that SegWit will help reduce fees; However, if you incorrectly send the incompatible assets to the address, your money will not be returned and will result in a permanent loss. ”
SegWit, released in 2017, is an update of the Bitcoin protocol designed to scale the network and fix related bugs. SegWit is known for updating data on the blockchain, ie separating signatures from transaction data. This protocol update allows multiple transactions to be stored in a single block, thereby increasing the volume of transactions.
Data from transactionfee.info shows that almost two thirds of bitcoin payments currently use SegWit. Although Bitcoin has evolved into a monetary instrument for storing value, it still faces limitations on scalability that some say hinders adoption for everyday use.
The Lightning Network was presented as a viable solution to extend Bitcoin Layer 2 as a payment protocol. Unlike SegWit, which was a minor update to the Bitcoin protocol, Lightning Network represents an additional layer that can provide low instant transactions.
Despite its limited transaction capacity, Bitcoin is still the de facto leader in the cryptocurrency market. Its dominance over other cryptoassets recently reached an annual high. At the time of writing, the bitcoin dominance rate according to CoinMarketCap was 68.7%.