Bitcoin's Segwit is almost activating!
Hello again fellow Steemians! It's only less than a day left until Segwit on Bitcoin activates and so I wanted to share with you all my opinion and predictions on what I think is going to happen in the days and weeks to come.
Segwit countdown begins...
So first of all, as of this writing there are only 116 blocks left to be mined for the official activation of Segwit
https://xbt.eu/
What this means now is that all the blocks solved by miners without Segwit will be rejected from the Blockchain and the blocks with Segwit will have their Digital Signatures separated from the transactions to allow more room inside the 1 MB Blocksize limit.
History of Segwit
As we look back in history one of the big cryptocurrencies today, Litecoin, successfully activated Segwit on May 2017, just 3 months before, as of this writing:
https://www.coindesk.com/litecoin-successfully-activates-long-debated-segwit-upgrade/
Unsurprisingly, the price of Litecoin rose from around $15 to $30.
https://coinmarketcap.com/currencies/litecoin/
Bitcoin's turn at Segwit
If Bitcoin's price today ($4272.59) were to copy Litecoin's Segwit euphoria moment then maybe we could be seeing an $8K Bitcoin around the corner? Yeah, probably too good to be true but with Bitcoin you never know...
https://www.coindesk.com/price/
Forecast of Lightning coming
The Segwit euphoria will likely keep the Bitcoin price bullish and it will probably keep climbing with the Bitcoin community's anticipation of the next step after Segwit: The Lightning Network.
Here's a link to the publicly available White Paper on the proposal for the Lightning Network:
https://lightning.network/lightning-network-paper.pdf
Unexpected, yet not so unexpected, turbulence on the horizon
https://cash.coin.dance/blocks
I predict Bitcoin Cash is going to once again steal the spotlight in the middle of the Bitcoin bull run when the BCH difficulty will readjust, thanks to its built-in EDA (Emergency Difficuly Adjustment), dropping down its Block difficulty and making it more profitable to mine Bitcoin Cash once more which will possibly result in miners temporarily leaving the Legacy chain again.
The last time it happened, just this week, it made a noticeable difference in the drop to the legacy chain's hashrate
https://blockchain.info/charts/hash-rate
Segwit put to the test!
This will be a very interesting time for Segwit to show it's performance with the following conditions to consider:
- Backlog of transactions in anticipation of Segwit
The news of Segwit being added into Bitcoin is catching the attention of many investors and speculators adding more and more transactions to be processed and quickly filling up the mempool:
https://blockchain.info/charts/mempool-size
https://blockchain.info/unconfirmed-transactions
- The Real Flippening: Bitcoin Cash Emergency Difficulty Adjustment
Bitcoin miners will once again be given a choice to mine Bitcoin Cash for more profit over the legacy chain of Bitcoin.
If miners will drop the Legacy Chain to mine Bitcoin Cash while the unconfirmed transactions are piling on with people and investors wanting to buy Bitcoin then the transaction times will significantly increase.
Segwit may improve capacity despite the 1 MB limit but will it improve the processing time if miners decide to leave at the peak of transactions increasing? We could be looking at average confirmation times of an hour or more if this is the case.
Conclusion!
I think Bitcoin will increase in price significantly at the start but if history will repeat itself then the hashrate of the Bitcoin legacy chain will drop and move to Bitcoin Cash when its difficulty decreases again and causes an increase of processing time for the legacy chain despite Segwit activation.
If this back and forth movement of mining hashrate between Bitcoin and Bitcoin Cash continues for months to come without any noticeable improvement in user experience for Bitcoin then there's a good chance that people will either move to Bitcoin Cash or more likely choose another Alt-coin ALTogether (pun intended) until users feel the situation has resolved itself. c",)