There will be no 2 MB bitcoin blocks with Segwit 2x. The initiators have canceled the update announced for the next week because they want to avert a split in the community.

Actually, in the coming week, an update with new rules for the Bitcoin network should take place, in which the parameter of the block size in the blockchain is increased from 1 to 2 MB. But central initiators of the update have now canceled this. It was not successful in creating a consensus for larger blocks in the community, according to Bitgo CEO Mike Belshe. Further pursuing the current path could lead to a split and harm the Bitcoin.

However, Belshe and the signatories to the announcement, including former core developer Jeff Garzik and Bitmain boss Jihan Wu, emphasize that a scaling solution for Bitcoin is needed in the face of high transaction fees. In the future, the Bitcoin community may find an agreement that includes larger blocks.

In a decentralized system such as Bitcoin, this can not be easily prescribed: A rule update for higher block sizes is not compatible with older clients; If some of the miners and nodes do not take part, they will continue to run on a separate blockchain, which could become a new cryptocurrency.

Failed compromise

The background to the Segwit 2x update is a lengthy dispute in the community as to how the Bitcoin network can handle more transactions. The update was intended as a compromise solution, which was mainly worn by companies in the crypto scene and professional miners. The update next week should be the second part of Segwit 2x; Previously, the Segregated Witness (SegWit) change was already enabled, changing the entry of transaction signatures in the blockchain, thereby creating more capacity.

The team of core developers of the reference client Bitcoin Core rejected so far any direct block expansion decided - and also opposed to the second part of Segwit 2x. Alternately, protagonists of both camps have been covered with allegations, such as that a hostile takeover of Bitcoin is planned. What the cancellation of the update for the future of Bitcoin means remains to be seen.

Transaction costs still high

The course of the crypto field made at least shortly after becoming known a sentence upwards, but then fell again and is currently at around 6800 US dollars (5800 euros). Instead, the competing currency Bitcoin Cash, which has 8MB blocks in the blockchain, jumped up to around $ 800 (€ 687).

The transaction fees have risen again since the end of October and are currently around $ 7.6 per transaction (6.5 euros), according to bitinfocharts. Thus, the Bitcoin for everyday payments is virtually unusable. The fees are theoretically voluntary and serve as an incentive for the miners to preferentially accept a transaction in the tight space of a block. Practically one comes but hardly around it. Although Segwit's scaling solution, which is a favorite of the Bitcoin core warehouse, has been active for several months, it is unlikely to be used to date to solve the fee problem in the long term.