The New Version of Bitcoin Core Fully Supports SegWit Addresses

February 22, 2018

The SegWit soft fork took place in the Bitcoin network in August of last year and, unlike the hard fork, did not mean mandatory use by all participants. Despite the advantages of SegWit in terms of scalability and the resulting reduction in transaction fees, mass adoption did not take place, and today, SegWit transactions on Bitcoin’s blockchain account for slightly more than 13%.

The main problem is the complexity of creating SegWit addresses for the “uninitiated,” whereas this is the main condition for implementing the technology. SegWit transactions can be performed only if the sender and the recipient have SegWit addresses.

The Bitcoin Core 0.16.0 release makes it easy to create SegWit addresses in the main client, the Bitcoin Core wallet. For this, SegWit was added to the command line and the wallet interface. Engineer of Chaincode Lab and member of the Bitcoin Core team Marco Falke noted that the creation of SegWit addresses was possible in previous versions of the wallet, but this process was “rather awkward” and “mostly hidden from view.” Now the SegWit addresses will be set by default.

In addition, this is the first version that supports “native SegWit addresses,” bech32, introduced by developers Peter Vuille and Greg Maxwell. In comparison with traditional Bitcoin, bech32 is more “user-friendly” and also automatically supports SegWit. According to Falke, this is “the most exciting part of the release.”

Chau notes that the bech32 format provides lower fees, but most wallets do not yet support it. Developers expect that the automatic creation of SegWit addresses will help reduce fees. Other innovations are also aimed at increasing the flexibility of the wallet.

Now SegWit is supported by a relatively small number of market participants, but their number is noticeably increasing. Today, among them are BitGo, Trezor, Ledger, Electrum, Samourai Wallet, GreenAddress, OpenBazaar, mSigna, Edge, Keepke, HitBTC,, Kraken, ShapeShift, Bitstamp, and Bitso, as well as Bitrefill and CoinGate payment services. The intention to add SegWit addresses in the first quarter of 2018 has already been reported by one of the largest wallets,, and in early February, the Coinbase exchange announced that it is at the last stages of testing the technology and would soon make it available to users.

Although the previous release, 0.15.1, was also aimed at expanding SegWit support in wallets, the developers claim that the launch of the alternative SegWit2x software temporarily shifted the focus of their activities. One of the reasons that the start of full support for SegWit addresses was postponed, according to Chau, is that the team wanted to see how SegWit works on the network and make sure there are no vulnerabilities.

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