Litecoin expansion is settled, where will Bitcoin expansion go?

As early as July 2016, the Litecoin kernel development team and the Litecoin Association released the "Litecoin Official 2016 Development Roadmap", announcing that they would release a new version with functions such as "Segregated Witness", "Lightning Network", and "Smart Contracts".

(Currently, the support rate for Litecoin Segregated Witness has reached 75%. Image source: Golden Finance)

This year, a roundtable meeting was held with miners, mining pool representatives and developers on the issue of Litecoin protocol upgrade, and the latest announcement was released on April 21.

The announcement stated that the protocol upgrade should be carried out under community consensus. After voting, the participating members unanimously agreed to implement the SW soft fork upgrade on LTC.

The announcement emphasized that the roundtable only expresses the consensus reached among the participating members and cannot make decisions on behalf of the LTC community.

Currently, the support rate of Litecoin SW has reached 75%, and it is inevitable that Litecoin will fork in this route.

According to the market conditions of domestic trading platforms, Litecoin increased from more than 20 yuan to around 80 yuan in one month, an increase of 200%. The implementation of Litecoin soft fork is considered by investors to be the biggest good news in the short term.

In addition, like Bitcoin, since Litecoin is also subject to withdrawal restrictions, the price on foreign trading platforms is significantly higher than the domestic Litecoin price.

Litecoin's implementation of SW will help Bitcoin break out of the expansion deadlock

Segregated Witness was originally proposed as a scaling solution for Bitcoin. Due to the conflict between developers and the market, Bitcoin scaling has always been controversial within the community.

Apart from a shorter block time, a different hashing algorithm and a few other initial merchant-thinking design changes, Litecoin is technically identical to Bitcoin. Litecoin, once the second largest coin by market cap, was also embroiled in the Bitcoin scaling debate for some time.

As Bitcoin is currently stuck in a capacity expansion deadlock, some people believe that Litecoin's implementation of SW will help Bitcoin get rid of the awkward situation of capacity expansion. In a sense, Litecoin serves as a test subject for SW to verify whether it is feasible in Bitcoin.

Litecoin's implementation of SW will help Bitcoin break out of the expansion deadlock. Image source: Golden Finance

Litecoin needs new innovations to drive development

Litecoin's soft fork is not due to scalability issues because it is not congested.

Unlike Bitcoin, Litecoin was developed by improving the Bitcoin core code, and faster transactions are the innovation of Litecoin.

(Litecoin needs new innovations to promote development. Image source: Golden Finance)

With the development of the entire digital currency industry, this innovation alone can no longer be a reason to promote or make Litecoin progress further. The functions of Segregated Witness, Lightning Network and Smart Contracts meet Litecoin's need to pursue innovation.

In the absence of price fluctuations, Litecoin activity has decreased. In this case, participants, users and even miners have gradually lost confidence in investing in Litecoin, not to mention its applications.

Implementing SW on Litecoin meets the requirements of all parties. The development team wants more innovation, and SW provides innovation scalability; miners and investors pursue profits, and soft fork upgrades are beneficial. In the long run, it is not ruled out that Litecoin will have more positive factors due to the implementation of SW.

Therefore, Litecoin's SW soft fork is not a rigid requirement, but a necessary one.

Bitcoin expansion hides more interests and rights disputes

Unlike Litecoin, Bitcoin forks are to solve the core problem of congestion caused by block size, while Litecoin forks do not have network congestion. Although Litecoin has many beneficial factors in implementing SW, it does not mean that Bitcoin can apply SW.

The Bitcoin industry has more investors and miners. The faction that supports Bitcoin expansion is actually not against Segregated Witness, but against the small block plan of the Bitcoin core development team CORE. CORE's intention is to weaken the influence of miners in the entire network, so there are more rights and interests behind the expansion of Bitcoin.

(Bitcoin expansion hides more benefits and rights. Image source: Golden Finance)

In the Bitcoin community, users, miners and developers are the three main roles, and miners are coin holders or hoarders. Anyone can buy a mining machine to mine and have computing power, but the rights of developers are only in the hands of 1% of the people.

At the same time, Blockstream, whose main business is sidechain research, hired members of the Bitcoin core development team CORE, which caused strong dissatisfaction among miners and the community.

Some people said that the "technical improvements" made by the CORE team were actually services provided to Blockstream. This confrontation has resulted in the Bitcoin expansion problem not being resolved.