Čvn 13

Litecoin and Lightning Network Coming Very Soon to Bitstamp?

· June 13, 2017 · 1:20 pm

Bitstamp tweeted a mysterious video featuring a lightning bolt seemingly making a thumbs up which follows speculation that Litecoin will be soon added to the site. The video also suggests that access to the lightning network is coming too.


Litecoin Rumors

The mysterious tweet coincides with Litecoin creator Charlie Lee’s departure from Coinbase where he worked as their Director of Engineering for the past two years. Coinbase recently added Litecoin to the site and their exchange GDAX where it has seen good trade volume with today’s LTC/USD market seeing a 468,665 LTC trade volume in the last 24 hours.

This flurry of activity for Litecoin follows its implementation of SegWit. Yet to be implemented for Bitcoin, SegWit (Segmented Witness) is seen by many as the solution to Bitcoin’s current scaling problems, allowing for larger block sizes and faster transaction times.

SegWit and Litecoin

With its lightning network capabilities, Lee sees Litecoin’s long-term goal as alleviating some of the smaller transactional volume, perhaps using it for micropayments such as buying coffee with zero confirmation times or transaction fees.

Many already see Litecoin as a testing ground for future Bitcoin features, however, Lee remains committed to Bitcoin too, as he also contributes to its development and has tweeted in the past about Bitcoin being regarded as a real store of value – gold to Litecoin’s silver. He argues that if you are wiring $50,000 to your bank, you could still use Bitcoin for the increased security that comes from its larger network of decentralized miners.

When Lightning Strikes

The implementation of the lightning network on Litecoin, which was initially developed for Bitcoin, is now a reality on Litecoin. It brings instant payments with no need for block confirmation times. Security is enforced by blockchain smart contracts and payment speeds are in the milliseconds to seconds range.

Its scalability means that it is capable of handling millions – even billions – of transactions per second across the network. It is low cost, as it settles off chain it allows for exceptionally low fees, which is why it is ideally suited to instant micropayments.

The most crucial benefit of the lightning network, however, is its ability to cross blockchains. This will allow for cross blockchain atomic swaps without trust in a 3rd party. This feature means that the lightning network would also need to be available on that coin too, something that could be a reality with Bitcoin should the coin pull off its UASF to enable Segwit. We live in exciting times.

Do you believe the rumors? Should UASF be activated on Bitcoin or should Litecoin take the lead? Let us know in the comments.


Images courtesy of Twitter, AdobeStock, Reddit

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Kvě 30

UASF Continues to Gain Support as ‘Secret’ SegWit2x Roadmap Revealed

· May 30, 2017 · 10:30 am

Though a Bitcoin scaling agreement was reached at the recent Consensus conference in New York, many companies are increasingly supporting a User-Activated Soft Fork (UASF)  as a means to activate SegWit.


UASF Still on the Table

Although reports have stated that the Bitcoin scaling debate may be coming to an end due to what has been known as the ‘Barry Silbert Agreement,’ recent developments indicate that it may still be far from over, leaving other options like the User Activated Soft Fork (UASF), a proposal that has been slowly gaining traction among Bitcoin businesses.

The given agreement dubbed “SegWit2x” is a compromise by several companies in the blockchain space that represent roughly 83% of the global hash rate to activate the SegWit proposal at an 80% threshold and to activate a 2MB hard fork within six months.

Meanwhile, prominent Bitcoin community member “WhalePanda”  tweeted out the details of the SegWit2x proposal today. The roadmap sets only a month for testing. Furthermore, it proposes to get the nodes up and running as well as signaling by July 21st, 2017.

Interestingly, this falls before the BIP 148 August 1st activation date.

Given its short timeframe, Bitcoin Core proponents say that the given approach is not enough to properly implement a hard fork. Due to its risky nature, it would require a second SegWit BIP to be introduced before the current one expires.

This means that the UASF may be the only way to realistically implement SegWit. Although the proposal is viewed by some as somewhat “intrusive” or even dangerous, 27 companies have shown support for it, a number that has more than doubled since the last time we talked about this subject.

Who Supports UASF?

Since the last time we visited this subject, 15 companies have signaled their support for the UASF proposal, including:

  • Abra;
  • Bitcoin Embassy;
  • Bitcoin India;
  • Bitfury;
  • Bitrefill;
  • Electrum;
  • Mycelium and others.

Currently seven companies are also opposing the UASF: Bitpay, Bitillions, BTCPOP, CoinATMRadar, F2Pool, MrCoin, and OXT. Meanwhile, both the Ledger and Trezor hardware wallet manufacturers are currently ready for the UASF BIP 148 update.

While most companies are in favor of the miner activated SegWit, the same level of support is not reflected with the UASF proposal. Some companies are still waiting for a less intrusive method of activating SegWit. ShapeShift, for example, has publically stated that it will wait for the Barry Silbert agreement to materialize. If it doesn’t, then ShapeShift will run a BIP 148 UASF node.

The reason why companies are still waiting for other solutions can be found in the nature of the User Activated Soft Fork, which poses some potential dangers for the Bitcoin ecosystem.

What is UASF & What Are the Risks?

A User Activated Soft Fork is a soft fork in which the users or nodes create a penalty for miners that do not signal the intended soft fork. This is done through a modified version of a Bitcoin Client, which gives a block height limit for miners to start signaling SegWit.

Once this block height is reached,  nodes that are running the UASF client will stop accepting blocks that don’t support SegWit. Since nodes are the ones that verify transactions, if a majority of nodes is running a UASF client, then blocks that don’t signal SegWit will be considered invalid by the majority of nodes, while SegWit blocks will be accepted by every node, old and new.

Though this system seems like a sure way to activate SegWit, it sill poses some dangers for miners that continue to mine non-SegWit blocks and for nodes that are not running the UASF client. If a majority of miners decide not to support SegWit, there will be a chain split and old nodes that are not running UASF will follow the chain with the most miners.

This would mean that the Bitcoin blockchain would be split into two chains, one with and the other one without SegWit. The blockchain in which SegWit would be active would be the one with the least hash power, a concerning factor for Bitcoin’s security.

Do you think SegWit can be activated without the UASF proposal? Can the SegWit + 2mb Hard fork Bitcoin Scaling Agreement get it done? Share your thoughts on the comment section.


Images courtesy of Twitter, Shutterstock

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Kvě 10

Litecoin Activates SegWit Today As Price Nears $40

· May 10, 2017 · 9:48 am

SegWit activation day is here for Litecoin as the fourth-largest cryptocurrency gains another 38% in price.

Litecoin Passes $35, Lee Remains Cool

With just several hours to go before its “locked-in” status changes to “activated”, investors are celebrating as Litecoin’s price per token exceeds $35.

The surge marks a turnaround in the altcoin’s fortunes, prices having suffered earlier this week as assets across the board hemorrhaged value.

Poloniex, a major altcoin exchange, experienced slowness and loading problems, which some pointed to as a major cause of panic selling resulting in a broad comedown.

On Twitter Wednesday, Litecoin creator Charlie Lee appeared naturally upbeat, noting nonetheless that this was just the start for his cryptocurrency.

SegWit Still King For Investor Confidence

The rags-to-riches story has been marked by overwhelming investor appetite for SegWit. The confidence that accompanied Litecoin locking in the technology appeared to engulf any misgivings or even alleged attempts to derail the process.

This in turn led to a rapid U-turn for two other altcoins, namely SysCoin and Vertcoin, which both successfully activated SegWit and benefitted from giant price rises.

As in the case of Litecoin, criticism that SegWit activation was simply a tool for developers to make money did not stop trading interest.

Now, Litecoin will no doubt be eyeing the next step in the chain – introduction of Lightning Network transactions.

Lightning Network Brewing

“The activation of segwit on Litecoin allows us to deploy Lightning on an active production blockchain,” Lightning’s Olaoluwa Osuntokun wrote in a blog post last week.

“With our ultimate launch, we’ll be able to examine monetary incentives within the network, observe the emergent properties of the networks’ channel graph, and see the rise of production services and applications built on top of the network.”

A survey conducted by Lee meanwhile suggested Litecoin users were keener on harboring their funds long term than testing Lightning.

Lee himself stated that he intended to both “hodl” and test the technology.

Across the altcoin board meanwhile, only a modest recovery is noticeable, while Bitcoin is also down from its near $1800 highs. The figures will likely be music to the ears of experts such as Vinny Lingham, who repeated warnings about “bubbles” in recent public comments.

What do you think about Litecoin after SegWit activation? Let us know in the comments below!


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Dub 22

Litecoin: Bitmain Trades Sides, Supports SegWit Activation

· April 21, 2017 · 9:10 pm

Litecoin’s problematic course towards Segregated Witness (SegWit) activation has ended in an unusual display of unity.


Litecoin Roundtable: We ‘Unanimously Agree’ On SegWit Activation

Following a meeting of Chinese cryptocurrency players including exchanges and miners, a consensus was reached on activating SegWit despite some participants having previously been against the idea.

The so-called Litecoin Global Roundtable included Litecoin creator Charlie Lee, exchanges Huobi and Okcoin and formerly anti-SegWit mining pool Bitmain.

Summarized minutes released from the meeting confirm that subject to community support, participants “unanimously agree” to “implement Segregated Witness softfork on Litecoin.”

“When the usage of Litecoin block capacity is over 50%, we will start to prepare for a solution to increase the 1MB block size limit through a hardfork or softfork,” a proviso adds.

Bitmain Gets Behind Litecoin SegWit

The big surprise from Friday’s events was the support of Bitmain, whose CEO Jihan Wu had previously stated his opposition to SegWit on numerous occasions, both for Bitcoin and Litecoin.

Now, it appears, both Wu and Bitmain have U-turned on the idea.

The Roundtable added:

We want to emphasize that this roundtable meeting represents only the consensus of participating members, and cannot make a decision on behalf of the Litecoin community.

U-Turns Abound

Litecoin’s approaching SegWit activation threshold had caused a significant uptick in its price. Having traded at just under $4 per coin for a considerable period, increasing miner support saw it shoot past $10 and stay at these levels.

As interest increased, however, rumors began spreading of manipulation by Bitmain, which was accused by pro-SegWit Shaolinfry of artificially hindering Litecoin’s activation.

Lee himself appealed to the community to force a user-activated soft fork (UASF) to counter such activities. In a further sign of how the situation has changed, the Roundtable members added that they were now against as UASF with a specific activation schedule, stating:

We do not advocate a flag-day ‘UASF’ that does not go through [sic] any users or community voting process. This type of forced upgrade without community consensus put Litecoin in a risk of split

What do you think about the latest events for Litecoin? Let us know in the comments below!


Images courtesy of AdobeStock

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Dub 19

ViaBTC Explains Why They Don’t Support SegWit

· April 19, 2017 · 12:00 pm

ViaBTC’s latest blog post sheds some light on why the mining pool is opposing the Bitcoin scaling proposal, SegWit.


ViaBTC, Bitcoin Core and SegWit

ViaBTC just published a blog post in which they explain the reason behind their opposition to SegWit, citing the concerns regarding the complexity of the soft fork, the irreversible damage it may and the introduction of second-tier networks like Lightning Network. The mining pool also mentions Bitcoin Core’s impact on Bitcoin and the community as a negative, claiming that they are “abusing their previous influence”. The post reads:

Today, Bitcoin is in urgent need of diversified dev teams and implementations to achieve decentralization in Bitcoin development.

As companies and mining pools choose their side of the debate, SegWit or Bitcoin Unlimited, most have released statements regarding which solution they are backing and why. While most companies favor the activation of SegWit, mining power has been on the side of BU. Among the pools that support BU, Antpool and ViaBTC have been two of the most vocal regarding Bitcoin Core and the Segregated Witness proposal. On ViaBTC’s transaction accelerator page, a popup service statement reads:

ViaBTC is of the opinion that the current “Bitcoin Core + Blockstream” Bitcoin development team is not taking satisfactory steps to ensure the growth and advancement of Bitcoin in accordance with satoshi’s original white paper, and is in fact actively harming the health of the Bitcoin economy by actively stifling efforts to solve some of Bitcoin’s most pressing problems.

“SegWit doesn’t solve the most urgent capacity issue”

In the latest blog post dubbed “Why we don’t support SegWit”, ViaBTC states that SegWit is a soft fork solution for transaction malleability and that it cannot solve the current network overcapacity problem which is currently the most urgent issue in the Bitcoin network.ViaBTC goes on to state that second-tier networks like Lightning Network cannot be considered as a block scaling solution. The blog post reads:

LN transactions are NOT equal to Bitcoin’s peer-to-peer on-chain transactions and most Bitcoin use scenarios are not applicable with Lightning Network. LN will also lead to big payment “centers”, and this is against Bitcoin’s initial design as a peer-to-peer payment system.

However, the SegWit is not Lightning Network (LN). SegWit introduces a much-needed fix for a pressing issue in Bitcoin, which is transaction malleability. This fix would allow LN to be implemented in Bitcoin.

Bitcoin network overcapacity

However, ViaBTC seems to be missing some very important points. The introduction of a patch to one of Bitcoin’s bugs should not be considered as harmful just because it allows developers to build a second network on top of Bitcoin. Bitcoin should be cleared of bugs like transaction malleability and developers should be free to build whatever they want (which is what has happened so far) on top of Bitcoin.

The fact that a mining pool would block an important fix like this due to the possibility of losing out on transaction fees is, at best, selfish. ViaBTC also seems to have missed the fact that some forms of second-tier networks are already possible in Bitcoin, even without the transaction malleability fix, and are being developed right now. Lastly, one should also note that without these channels, users that are looking for the advantages they would provide will find them elsewhere either through altcoins or centralized payment systems, which can only result in the loss of use cases for Bitcoin with nothing gained.

ViaBTC’s statement that “SegWit doesn’t solve the most urgent capacity issue” is, however, correct. While it may be considered as a “quick-fix” that will double the network’s capacity, further updates will have to be made in the future. This is where Bitcoin Unlimited seems to please its supporters, their Emergent Consensus protocol proposes a fix that is somewhat “permanent” as it allows the block size limit to change according to demand.

“SegWit makes it harder for future block scaling”

Here, ViaBTC cites some real concerns regarding the possibility for future scaling updates which are indeed made harder by SegWit’s changes. SegWit allows blocks to reach a 4MB limit due to the way witness data is accounted for. However, this limit is not meant to be reached, as the only data that is read differently is the witness data and not the tx. inputs and outputs. This results in a ~2MB block limit under regular circumstances.

This means that a possible attack vector is to create 4MB block which is a problem for the network. So, any future increases, for example from a ~2MB limit to a ~4MB limit, will theoretically allow a block that is four times bigger to be created, in the example above this would mean a ~16MB limit. This, however, is extremely unlikely and is not seen as a problem for Bitcoin Core developers.

The problem is that if a way to implement this attack did come along, SegWit could not be reversed. The blog post reads:

On technical terms, SegWit uses a transaction format that can be spent by those who don’t upgrade their nodes, with segregation of transaction data and signature data. This means SegWit is irrevocable once it’s activated, or all unspent transactions in SegWit formats will face the risk of being stolen.

While this may be a real concern to a certain degree, the prospect of an attack vector that is currently considered impossible and would theoretically become a problem once the network implements a second scaling update, which may never happen, doesn’t seem to be a valid reason for blocking SegWit.

“SegWit will deepen Core’s impact on the community”

In the last section of the blog post, ViaBTC states its concerns regarding the Bitcoin Core development team and its influence on the Bitcoin community, citing problems like the infamous censorship perpetrated by Bitcoin Core on Reddit and Bitcoin forums. This seems to be completely off from what Bitcoin is supposed to be, a global apolitical currency.

Bitcoin forums, boards and development teams are not part of Bitcoin. They are exterior to the network. If there is indeed censorship going on in these places, users should abandon them. If the Bitcoin Core team is trying to turn Bitcoin into a centralized payment system (or whatever), the community/miners should not approve their updates. However, rejecting an update based on the developer that proposed it, and not on the actual code, is childish. This reason could easily be turned around on the Bitcoin Unlimited development team, which has had its fair share of controversy.

Conclusion

While we do believe that both scaling proposals have their strengths and weaknesses, ViaBTC’s concerns regarding SegWit seem to be non-existent at best: Blocking transaction malleability is a malicious act on the network. Opposition to SegWit should be based on the problems it will cause the network and not on the problems it could theoretically cause if a currently-nonexistent attack vector is eventually found. Lastly, users should decide what is best for the network and not whom, that’s the beauty of Bitcoin.

Do you think that ViaBTC is right and that we are missing the point? If so, let us know in the comment section.


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Úno 08

Litecoin: SegWit ‘Testbed’ at Risk as Bitcoin Politics Spread

· February 8, 2017 · 8:00 am

The Segregated Witness (SegWit) update has received lukewarm support thus far since it was announced on Litecoin on January 28th.


Beyond Bitcoin: ‘Testbed’ for SegWit

After Bitcoin, the SegWit scaling update has now been introduced to Litecoin along with some other cryptocurrencies including Vertcoin, Groestlcoin, and Viacoin.

Right now, Litecoin miners are in the process of voting on the update. Currently at 3%, support is lower than it is in Bitcoin, which rapidly climbed up to 22% in its first two weeks.

Bitcoinist_Litecoin Logo

The vote has attracted the attention of the Bitcoin community. Litecoin (and other coins) could become a testbed for the potential SegWit soft-fork on Bitcoin, and could offer a sneak peek as to how this update fares in the real world. Moreover, SegWit may have better chances on Litecoin since its activation threshold is just 75% compared to Bitcoin’s 95%. 

But this “testbed” mentality may be part of the reason why Litecoin users are not so eager to activate the update, which would make them, in a sense, Bitcoin’s ‘lab rat.’ Dubbed the “silver to Bitcoin gold,” it currently has a market cap of about $198 million USD, which could be negatively affected if the update goes sour.

Creator: ‘Litecoin Became Political Too’

Nevertheless, the SegWit update is supported by Litecoin creator Charlie Lee.

charlie-lee-talks-about-litecoin-bitcoin-and-coinbase-22-640x360

In a recently held Reddit AMA (in Chinese), he stated:

Yes, it’s unfortunate that SegWit on Litecoin became political too. One of the reasons I’m doing this AMA is to try to pull the politics out of the Segwit on Litecoin. Let’s not let Bitcoin politics pollute Litecoin for no reason.

Meanwhile, LTC1BTC founder Jiang Zhuoer stated that his pool, which controls 10% of the network, will not support the SegWit update. His motives, however, seem to stem directly from the Bitcoin debate. 

“Why do the Bitcoin Core developers say that the Segwit soft fork basically fixes every line of Bitcoin’s code? Zhuoer said. “As the complexity of a system increases, it follows that the stability of that system must decrease.”

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Still, other pools have demonstrated their support for SegWit. F2Pool, the biggest Litecoin pool with 45.6% of the network’s hash rate, announced it will signal their support for SegWit in the coming weeks.

Litecoin Could Help Bitcoin Break Deadlock

Since Litecoin has a small number of users compared to Bitcoin, scaling is not exactly a pressing issue at the moment. Though SegWit was introduced to Bitcoin as a scaling solution, it also introduces additional features and paves the way for other upgrades such as the Lightning Network. 

Lee explained the motive for supporting SegWit saying,

The main fix is transaction malleability, which would allow Lightning Networks (LN) to be built on top of Litecoin. And there are a bunch more nice features of SegWit. With SegWit and Bitcoin’s current block scaling deadlock, I see a potential for Litecoin to help Bitcoin break through this deadlock[…]. We have been drafting behind the Bitcoin race car for many years. It’s about time to take a turn out front.

During the AMA, Lee also expressed his opinion regarding the alternatives that have been proposed, reassuring that Litecoin will stick to SegWit.

Litecoin roadmap

When asked what will Litecoin do if Bitcoin goes with Bitcoin Unlimited and FlexTrans, he said:

With such a controversial topic, I can’t see how Bitcoin can possibly go BU and FlexTrans. It will likely just not change, and that’s fine. It’s still the best store of value we have ever seen. Whatever happens, Litecoin is going the SegWit direction. And we welcome any Bitcoin Core devs to join us if Bitcoin, for some reason, goes in another direction.

Charlie Lee is currently holding another AMA thread on this topic (in english) here.

Will Litecoin pave the way for Bitcoin’s SegWit? Or will it fail to reach consensus?


Images courtesy of Shutterstock, Twitter, litecoinpool.org

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