Bitcoin is a digital currency that has been around for over a decade now. It is decentralized, meaning that it is not controlled by any government or financial institution. Instead, it is maintained by a network of users who participate in the verification and recording of transactions. One of the key features of bitcoin is the use of a public ledger called the blockchain, which records all transactions in a transparent and immutable way.
To send or receive bitcoin, you need a bitcoin wallet. A bitcoin wallet is a software application that allows you to store, send, and receive bitcoin. Each wallet has a unique bitcoin address, which is a string of alphanumeric characters that serves as your public key on the blockchain.
Bitcoin addresses typically start with the number 1 or 3, but there is another type of bitcoin address that starts with the number 2. This type of address is known as a SegWit address.
SegWit stands for Segregated Witness, which is a protocol upgrade that was introduced to the bitcoin network in 2017. The main goal of SegWit was to increase the capacity of the bitcoin blockchain by reducing the size of each transaction. SegWit achieved this by separating the signature data from the transaction data, which allowed more transactions to fit into each block of the blockchain.
SegWit addresses start with the number 2 because they use a different encoding format than traditional bitcoin addresses. The encoding format for SegWit addresses is called Bech32, which is a native SegWit format that was developed by Pieter Wuille, a Bitcoin Core developer.
Bech32 addresses are longer than traditional bitcoin addresses, but they are more efficient in terms of space usage. They also have built-in error detection, which makes them less prone to human error when entering the address.
To use a SegWit address, you need to have a wallet that supports it. Most modern bitcoin wallets support SegWit, but some older wallets may not. If your wallet does not support SegWit, you can still use traditional bitcoin addresses, but you may pay higher transaction fees and experience slower confirmation times.
SegWit has several benefits for users of the bitcoin network. The most obvious benefit is the increased capacity of the blockchain, which allows for more transactions to be processed. This can help reduce transaction fees and improve the speed of transactions.
SegWit also provides enhanced security for bitcoin transactions. By separating the signature data from the transaction data, SegWit makes it harder for attackers to manipulate transactions or steal funds. This makes bitcoin transactions more secure and reliable for users.
In conclusion, a bitcoin wallet address that starts with 2 is a SegWit address. SegWit is a protocol upgrade that was introduced to the bitcoin network in 2017 to increase the capacity of the blockchain and enhance the security of transactions. SegWit addresses use a different encoding format than traditional bitcoin addresses and are more efficient in terms of space usage. To use a SegWit address, you need to have a wallet that supports it, but most modern bitcoin wallets do. SegWit is an important development in the evolution of bitcoin and has several benefits for users of the network.