Ethereum: Why are segwit transactions cheaper than legacy transactions?

Ethereum: Why are transactions of separate witnesses (segwit) cheaper than old operations

In the world of cryptocurrencies, transparency and efficiency are the key to a successful online payment system. Two popular cryptocurrencies aimed at achieving these goals are Ethereum and Bitcoin, each of which has its own taxes on operation. One of the primary differences between the two cryptocurrencies is their implementation: SEGWIT transaction separation compared to old (non -specific) transactions.

What is segwit?

SEGWIT is a modified version of the Bitcoin Lightning network to perform more efficient and economical operations. The main idea of ​​SEGWIT is to reduce the number of operations needed to transfer funds, thereby reducing taxes. This innovation was presented in 2017 by Vitalik Buterin, founder of Ethereum.

Why are segwit transactions cheaper?

So why do segwit transactions look cheaper compared to old bitcoin transactions? The main reason is how operations are structured and optimized for both systems.

• This reduced use of space means lower cost of calculating and faster processing time.

• The headlines of these blocks have a shortened version of the operation and output values ​​of the operation, which facilitates the processing and control of operations.

• Faster approval time : Reduction of the number of operations needed to confirm one operation (Bitcoin “block size”), segwit allows faster processing of operation time compared to the inheritance.

Why do old addresses have higher taxes?

Now that you know why segwit is cheaper, let’s let’s do why Legacy’s addresses have ever higher taxes. The main reason is, such as old operations structured and optimized for both systems:

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• These fees are calculated on the basis of factors such as network overload, operating complexity and block size limit.

• Network overload

  : Legal networks are usually overcrowded more than SEGWIT networks, leading to longer operations and increasing gas tax costs.

What about Ethereum taxes?

The Ethereum design is somewhat more complicated than Segwit, whose native cryptomain is ether (ETH), which is the main engine of engine overload. However, Ethereum has introduced various measures to reduce taxes:

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Conclusion

Finally, the differences between segwit and older bitcoins can be attributed to the selection of design that each system has chosen. Although Segwit is optimized for efficiency and economy, old addresses are still higher due to increased computing complexity, additional gas taxes and network overload.

When the country of cryptocurrencies is constantly evolving, they understand these differences between segwit and old operations that become increasingly important for developers, merchants and consumers.

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