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Understanding Bitcoin's Scalability Issues

Bitcoin, the first and most well-known cryptocurrency of all, is more acceptable and popular since its release. On the contrary, since Bitcoin is catching on and more people start using and transacting with it, scalability has become a real problem. In this guide we will examine potential fixes for Bitcoin's scalability issues.

What is Scalability?

Scalability is nothing but the capability of a system to grow to manage an increasing amount of work or its potential to accommodate growth. Scalability in the context of Bitcoin is how well the Bitcoin network can process a growing number of transactions efficiently and quickly.

The Blockchain Size Limit

A primary scalability hindrance Bitcoin is encountering is the blockchain size limitation. The blockchain is a public and transparent decentralized ledger of Bitcoin transactions ever. But as the blockchain continue to add transaction, they have to store that, that blockchain size will keep grow and you need to have more storage and more computing power involved just to validate and process the transaction.

Transaction Processing Time

More Investments Means More Transactions On The Bitcoin Network During the high number of transactions on a day, processing and confirming transactions on the Bitcoin network take time for quite a long time. This can mean transactions taking longer to be included in a block and verified by miners - slower transactions, as well as higher fee prices.

Network Congestion

In times of high demand, like during bull markets or when transaction volume explodes, the Bitcoin network can become congested. Overloads happen when you have a backlog of transactions that the network is not capable of processing, which inevitably results in delays as well as increased fees for users.

Potential Solutions

The scalability problems with Bitcoin have been addressed by a number of solutions:

1. Segregated Witness (SegWit)

Segregated Witness (SegWit) is a protocol upgrade that first activated on the testnet in December 2015 end later on the Bitcoin network in August 2017. SegWit aimed to address network limitations that afflicted Bitcoin at the time; primarily, by addressing transaction malleability, an issue that once resolved would pave the way for second-layer scaling solutions. This decreases the size of transactions making room for additional transactions on each block.

2. Lightning Network

The Lightning Network is a Low-level (L2) protocol (second layer solution) over the Bitcoin blockchain proposed to make fast, cheap and secure txs. This is accomplished by establishing second-layer, off-chain payment channels between users to enable instant transactions without requiring block confirmation on the main blockchain.

3. Schnorr Signatures

A proposed cryptographic improvement, Schnorr Signatures would bolster signature verification on the Bitcoin network. Both the aggregated signature data made possible by Schnorr Signatures and the fact that transactions themselves could be of smaller size stand to improve the scalability and fees of the bitcoin network.

4. Increase Block Size

In contrast to this, some Bitcoin supporters have proposed extending the block size limit so more transactions can fit in a one-megabyte block. Yet this type of an approach is contentious and has raised questions among members of the Bitcoin community who are arguing over the varying between scalability, security and decentralization.


The scalability issues of Bitcoin (BTC) present rather significant challenges to the its future viability as a global payment network. We have discussed many proposed solutions to these issues, as well as answered some of what has been accomplished to combat these issues, but the Bitcoin community is still worried about scalability. Deciding upon scalable, decentralized, and secure long term solutions in line with technological advances is essential.

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