Bitcoin price is stable above $9,000, BitPay Supports SegWit

The Bitcoin price has recovered and is currently changing hands above $9,000. While this is a reprieve, news around Bitcoin adoption dominates.

3 years later, BitPay supports SegWit

The main highlight in the last 24 hours is BitPay’s decision to support Segregated Witness (SegWit).

Of note, the payment processor has been against this controversial update. SegWit was one of Bitcoin’s developers attempt to scale the network without a Layer-2 option.

After @BitPay finally joined #Segwit which companies are still behind the curve?

I wonder when Bitpay will support #LightningNetwork? pic.twitter.com/NvycCs7oiN

— Carsten (@CarstenBKK) July 2, 2020

Though implemented, the follow-through, SegWit 2X—an improvement that would have increased Bitcoin’s block size to 2 MB, was rejected. Unsatisfied, proponents including Roger Ver, forked the Bitcoin source code creating Bitcoin Cash (BCH).

In a blog post, BitPay said SegWit is now available as an optional feature in their Bitcoin wallets and invoice payments. However, as they roll out the feature, it will be made default by the end of the year.

SegWit Pros and Cons

SegWit is an improvement that increased block space without increasing block size, thereby keeping the Bitcoin chain size manageable. The argument was that an increase in block size would have exponentially increased the Bitcoin blockchain size limiting its node distribution.

With SegWit, the protocol moves witness data of each transaction towards the end. Some critics claim that shifting the position of witness data and simultaneously removing them when communicating with deflecting nodes, the overall network security is compromised. This is because, in their preview, down the line, there would be verification issues which may then affect security.

Still, SegWit is welcomed because it fixes the so-called malleability bug, and simplifies the operation of Layer-2 options like the Lightning Network.

Bitcoin price analysis

The Bitcoin price is at the time of writing trading at $9,100. It is down three percent on the last week, losing against ETH.

From the daily chart, the BTC price seems to be in range mode. Bound within a $600 range with immediate support at around $8,800, bulls are trending inside a descending channel. The 20-day moving average (the middle BB), is the immediate flexible resistance level.

Although bulls have a chance especially if Bitcoin prices stabilize above $9,000, bears have the upper hand.

Notably, the double bar bear reversal pattern of June 1-2, 2020 is valid following its confirmation on June 11, 2020. Then, bears broke below the three-month support trend line. Subsequent attempts by bulls have been futile as prices are still trending below $10,000.

A break above the $600 range and $9,300 (the middle BB) could pump BTC back to $10,000. On the flip side, steep losses below $8,800 may spark a sell-off that will see the Bitcoin price falter back to $8,500—or worse.

BTCUSD Daily chart courtesy of Trading View

Disclaimer: This is not investment advice. Opinions expressed here are those of the author and not the view of the publication.