What is BTC Segwit address?

[Crypto Library]

We are currently hearing this word "BTC SegWit address" in many places, for those who don't know about it, details are given below

What is SegWit ?

Segregated Witness (SegWit) is a protocol upgrade developed in 2015. The protocol upgrade brought up a number of benefits, such as improved transaction speed and block capacity. In addition, SegWit solved the so-called transaction malleability bug.
As of June 2020, Bech32 349 is supported in many popular wallets and is the preferred address scheme.

How to create SegWit (Bech32) BTC wallet address and why it is worth a while?

Before we describe how to create a SegWit Bitcoin address, you should know that there are two main reasons why you should do it.

First of all, as an innovative exchange platform, we want to show our support to the SegWit adoption and therefore every BTC withdrawal done to a bech32 address will reduce the CoinDeal withdrawal fee by half. Additionally, it is important to remember that EVERY transaction you do FROM a bech32 Bitcoin address (starting with bc1…) is going to be cheaper than if you did it using old/legacy BTC address (starting with 1… or 2…).

There are several ways of getting a bech32 BTC address as some online/desktop wallets offer to create them for you. In our eyes, one of the best and safest option is to get an Electrum desktop app and use it to create a BTC wallet supporting SegWit.
Here is a short guide on how to do so:

• Step 1: Download the app here
• Step 2: Create a new wallet by giving it a name:
  
• Step 3: Choose the type of wallet (for our purposes, Standard is enough)
  
• Step 4: Select ‘Create a new seed’ from the list. It is a safety measure allowing a wallet recovery
  
• Step 5: Select Segwit from the Seed type list:
  
• Step 6: Write down the generated words (seed) in a safe place where you will not lose it:
  
• Step 7: Create a password if you want to restrict the access to your wallet within Electrum app:
  
• Step 8: Your wallet address will be visible upon going to ‘Receive’ tab:
  

Important notes regarding Electrum wallet:

• You can use the same wallet address to receive funds, however, Electrum will generate a new address for you each time as it is a more recommended way in the blockchain world
• Before sending/receiving BTC via Electrum, it would be best to read through their documentation or to search videos/articles explaining in more details what is Segwit wallet and how it works

There are more benefits to using bech32 addresses, however, once again we would like to point out that aside from having lower fees for sending BTC from Segwit addresses, you are also getting 50% lower fees on Coindeal when withdrawing Bitcoins from our cryptocurrency trading platform to an external bech32 wallet address.

Is trust wallet compatible with Segwit?

Your new Bitcoin , Litecoin , Viacoin  and Digibyte  Wallet are native SegWit compatible which means you can send/receive to/from any bech32 address.

I have tried my best to give as much information as possible, sorry if anything is wrong. Thank You

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[khaled0111]

Thank you for quoting the guide on how to create a segwit wallets with Electrum but I think it's a bit outdated. Newer version of Electrum will create a segwit wallet (bech32 adresses starting with bc1) by default and this is since version 4.1.0 (March 2021)^*.
Newer version of Electrum do not allow creating legacy wallets from the GUI anymore. To do so you have to use the command line.
Or you can generate a legacy seed from the Console by typing this command:

Code:

make_seed(seed_type="standard")

* https://github.com/spesmilo/electrum/blob/29d8d8de2619bba9f87c2cc6ca3e68ae2b33031f/RELEASE-NOTES#L152

[hugeblack]

just want to add, it is better to learn about cryptos from better sources and not from trustwalletcommunity, news sites, unknown sites or any other paid company academy.
The information that is provided is usually general, inaccurate, not highly credible, and they do not correct articles after they have been published.
Do not forget that some of these companies, for example, (Bitcoin.com) they hate bitcoin, so you may find some intentional errors.

[JeromeTash]

I have tried my best to give as much information as possible, sorry if anything is wrong. Thank You

Then don't share any information here if you are not sure about it, or else you end up misleading newbies

For example;

is going to be cheaper than if you did it using old/legacy BTC address (starting with 1… or 2…).

Addresses that start with 2... are not used on the mainnet. They are testnet legacy pay to script hash address.

[smartaction]

I have tried my best to give as much information as possible, sorry if anything is wrong. Thank You

The information you have shared here is just the steps to create Electrum wallet. Which is a very common thing. It can only be helpful for them. For those who don't know, where user can get BTC SegWit address and which wallet provide it. You should have added some more information to it. For example, any wallet other than Electrum wallet is predominant in SegWit format wallet. However Thank you for your knowledge about it as a new user.

Some SegWit Wallet Provider List

• Electrum wallet- https://coindeal.com/support/article/segwit/
  
• TREZOR Wallet - https://blog.trezor.io/how-does-segregated-witness-work-in-trezor-wallet-e8dd34d0fc1a
  
• BitPay App - https://support.bitpay.com/hc/en-us/articles/360044453272-How-to-create-a-Bitcoin-Segwit-wallet-
  
• Blockchain Wallet - https://support.blockchain.com/hc/en-us/articles/4417082173716-How-do-I-receive-bitcoin-to-a-Legacy-address-
  

What is the Benefit of Using SegWit Formet wallet?
SegWit cost low gas fee then other wallet like Legacy (P2PKH),  Native SegWit (bech32) and This allows each block to have extra capacity to store more transactions per block. This means the network can process more transactions per block.


How will a user know what Formated wallet he is using?
Wallet Format For BTC :

• Legacy (P2PKH): this Addresses will start with a 1. Example - 1BvBMS********************
• Nested SegWit (P2SH): this Addresses will start with a 3. Example- 3BvBMShsI***********************  
• Native SegWit (bech32): addresses start with bc1. Example - bc1qa**************************

[Crypto Library]

-Snip-

If you follow the links I provided, you will see this information there. But I appreciate your opinion. It highlights some important points Which I should have mentioned.

[nc50lc]

SegWit cost low gas fee then other wallet like Legacy (P2PKH), -snip-

Please do not use the term "gas fee" in Bitcoin. It's an Ethereum term, use "fee rate" for the 'sat/vB' amount or "fee" for the absolute fee instead.

[o_e_l_e_o]

How will a user know what Formated wallet he is using?
Wallet Format For BTC :

• Legacy (P2PKH): this Addresses will start with a 1. Example - 1BvBMS********************
• Nested SegWit (P2SH): this Addresses will start with a 3. Example- 3BvBMShsI***********************  
• Native SegWit (bech32): addresses start with bc1. Example - bc1qa**************************

There are a few things wrong with this.

P2SH addresses are not necessarily nested segwit. There are plenty of other scripts which can be encoded in a P2SH address and will have addresses starting with 3 while not being nested segwit.
Bech32 is the encoding of the character set and checksum, not an address type. Native segwit is more accurately called P2WPKH (pay to witness pubkeyhash).
Now that we have taproot (P2TR, which also use bech32 encoding), you need to specify that native segwit addresses start with bc1q. This is distinguish them from taproot addresses which start with bc1p.

[NdaMk]

just want to add, it is better to learn about cryptos from better sources and not from trustwalletcommunity, news sites, unknown sites or any other paid company academy.
The information that is provided is usually general, inaccurate, not highly credible, and they do not correct articles after they have been published.
Do not forget that some of these companies, for example, (Bitcoin.com) they hate bitcoin, so you may find some intentional errors.

I think I also need answer to this question because most of this sites only have post crediting there own software /app with showing its lapses or cons but that's what every typical programmer will do. So we're can we get the right information apart from the stated places

[1miau]

How to create SegWit (Bech32) BTC wallet address and why it is worth a while?

It's always good to know that there are different address types of Bitcoin addresses and that we can save some fees and reduce network congestion by using SegWit (the best one is native SegWit, bech32).
I've written a guide about it some time ago: Why people should be using SegWit addresses

And also mikeywith wrote an interesting guide for newbies: BTC addresses starting with "3" what are they ? simplified explanation.
See also my comment here because in my opinion it's very easy to spot on Blockchair: https://bitcointalk.org/index.php?topic=5133475.msg50677183#msg50677183

It's displayed a bit differently today but "additional information" (below transaction status) will show you "Has witness data? yes/no". 

   

SegWit (Yes): https://blockchair.com/bitcoin/transaction/db6d2b441a5964cd4c3ccdb7316738b020def1fdf2726201f07cc74016844e50
No SegWit (No): https://blockchair.com/bitcoin/transaction/b4262cc5ac3be3899c6d840408eb4252c150bdf82534921360aa5946ded9d62a

(that's what o_e_l_e_o described here:

P2SH addresses are not necessarily nested segwit. There are plenty of other scripts which can be encoded in a P2SH address and will have addresses starting with 3 while not being nested segwit.

[SquirrelJulietGarden]

Bech32 adoption.
Segregated Witness Wallet Development Guide
It is many years since the Segwit deployment so nowadays if a wallet does not support it, you should choose another one to use.

[khaled0111]

It is many years since the Segwit deployment so nowadays if a wallet does not support it, you should choose another one to use.

Exactly! Segwit (bech32) was first introduced back in 2017 (if am not wrong) so it has been around for more than five years now. Given all its benefits, not only to users but to the Bitcoin network as a whole, it's better to avoid using any service/wallet which didn't upgrade their servers/codes to support it.

I would like to see more threads on the B&H board talking about taproot (for example: its advantages and which wallets support it).

[SquirrelJulietGarden]

Exactly! Segwit (bech32) was first introduced back in 2017 (if am not wrong) so it has been around for more than five years now. Given all its benefits, not only to users but to the Bitcoin network as a whole, it's better to avoid using any service/wallet which didn't upgrade their servers/codes to support it.

Some exchanges nowadays still don't support Segwit Bech32 address. Binance only supports it in December 2020. They are too late but at least they support it. Their announcement

Electrum wallet stops to support Legacy address long time ago. They only allow users to use Bech32 address by default. There is way to use Console and get Legacy address but it is for tech guys.

I would like to see more threads on the B&H board talking about taproot (for example: its advantages and which wallets support it).

Taproot, I have some topics in Taproot - The biggest upgrade for Bitcoin since 2017 & documents to read. If you or anyone knows other topics about Taproot, please give me links, I will consider adding them to my topic.

[Zilon]

Exactly! Segwit (bech32) was first introduced back in 2017 (if am not wrong) so it has been around for more than five years now. Given all its benefits, not only to users but to the Bitcoin network as a whole, it's better to avoid using any service/wallet which didn't upgrade their servers/codes to support it.

Some exchanges nowadays still don't support Segwit Bech32 address. Binance only supports it in December 2020. They are too late but at least they support it. Their announcement

Luno also place support for Bech32 address as well but are yet to implement them. the late adoption isn't bad though it shows support for low transaction fee by some exchange. But don't you think if more exchange especially centralized ones adopt Bech 32 and its upgraded version Bech 32m privacy bridge might occur because it will be hard to detect if a transaction was anonymous or not.

[pooya87]

Luno also place support for Bech32 address as well but are yet to implement them. the late adoption isn't bad though it shows support for low transaction fee by some exchange.

If any exchange is not yet supporting Bech32 addresses today then you can't really call it "late" because it's been 5 years already! Late is for when it takes then 6 months to implement something not 30 months. It should make you wonder what else they haven't upgraded like their security and maybe even vulnerabilities that could lead to you losing your coins while using their services.

[Charles-Tim]

But don't you think if more exchange especially centralized ones adopt Bech 32 and its upgraded version Bech 32m privacy bridge might occur because it will be hard to detect if a transaction was anonymous or not.

I do not really understand this, but did you mean because of anonymity, P2TR may not be adopted on exchanges? Exchanges can accept any of it. As far as I still know, you can maintain privacy and anonymity and still pay into the exchanges if your coin is not tainted or involved in illegal transactions. Yet, both native segwit and P2TR are not privacy means of payment like Monero and Litecoin Minblewinble. Although, you can have privacy if you know how or maintain anonymity while using bitcoin for payment, but bitcoin blockchain is transparent and available to the public.

If any exchange is not yet supporting Bech32 addresses today then you can't really call it "late" because it's been 5 years already! Late is for when it takes then 6 months to implement something not 30 months. It should make you wonder what else they haven't upgraded like their security and maybe even vulnerabilities that could lead to you losing your coins while using their services.

Over 80% and more of bitcoin transactions are now segwit, I am wondering how some exchanges like OKX and Huobi Global and maybe some wallets are not yet supporting segwit, since 2017 when segwit was adopted.

[Cashi]

SegWit cost low gas fee then other wallet like Legacy (P2PKH), -snip-

Please do not use the term "gas fee" in Bitcoin. It's an Ethereum term, use "fee rate" for the 'sat/vB' amount or "fee" for the absolute fee instead.

Yes, Gas fee is not really suited for Bitcoin because Gas is usually a measurement for Ethereum [ETH] fees.
Bitcoin is not using Gas for transactions, it's simply using a normal transaction provided by sats/vbyte.

[Cookdata]

In addition to what others have said, don't generate seed phrase on Electrum if you plan on using it on another wallet, may be not today or tomorrow because the the seed words isn't BIP39 compatible standard for other wallet. Electrum wallet support BIP39 seed phrase, meaning you can always used any seed phrase on Electrum wallet to generate addresses but you can't use their own mnemonic words for other wallets.

[Charles-Tim]

In addition to what others have said, don't generate seed phrase on Electrum if you plan on using it on another wallet, may be not today or tomorrow because the the seed words isn't BIP39 compatible standard for other wallet.

That is true, seed phrase generation on Electrum is not BIP39 and the seed phrase generation on Electrum can not be imported on BIP39 wallets. But you can try Bluewallet, you will be able to successfully import Electrum seed phrase on the wallet, it works fine.