Binance Starts Supporting Bitcoin Deposits via SegWit Address

Binance, arguably the largest cryptocurrency exchange in terms of trading volume, has started supporting Bitcoin deposits via Segregated Witness (SegWit), which enables soft fork change in the transaction methodology of Bitcoin (BTC).

The information was revealed by Binance on the eve of Christmas. Previously, the covenant upgrade facilitated only withdrawals.

With the support for SegWith deposits in place, Binance users will be able to transfer funds to a SegWit (bech32) address by choosing the SegWit network. Binance detailed:

“Please note SegWit should help reduce fees; however, if you incorrectly send incompatible assets to the address, your funds will not be recoverable and will result in permanent loss.”

Incorporated three years back, SegWit is a Bitcoin covenant overhaul structured to assist in stepping up the network and rectify related glitches.

SegWit basically updates amends info on the blockchain by segregating signatures from trade data. The covenant upgrade paves way for storing higher number of transactions in a single block thereby boosting transaction capability.

Data from transactionfee.info indicates that about two-thirds of Bitcoin payments presently utilize SegWit. Even though Bitcoin is transforming into a store of value, still, it is facing issues related to scalability, which professionals put forth as a reason for slow adoption.

Lightning Network, a payment protocol, offers a feasible layer 2 scaling for near-instantaneous Bitcoin (BTC) transactions. Contrary to SegWit, the Lightning Network provides an additional layer that could pave way for real-time, cost-effective transactions.

In spite of restricted transaction capabilities, Bitcoin stays the veritable leader of the cryptocurrency market. Bitcoin’s dominance over altcoins recorded new yearly high in recent times. Currently, Bitcoin’s dominance factor is 67.6% as per data provided by Coingecko.com.