As contention continues to fester around Bitcoins' scaling issues, a testing ground for one proposed solution has emerged, as Litecoin considers the implementation of Segregated Witness.
In late 2016, Litecoin founder Charlie Lee began advocating for segwit to activate on both Litecoin and Bitcoin, despite Litecoin having no issues with block-size. His support has been focused on expanding Litecoins' core functionality to allow Lightning Networks, and to keep Litecoins' transaction fees and confirmation speed competitive. He has also recently advocated for using Litecoin as a proving ground for new features, prior to their activation by Bitcoin.
“Until SegWit, LN, and Confidential Transactions, I didn’t see a need for Litecoin to come out to help test features before they are on Bitcoin … But with SegWit and Bitcoin’s current block scaling deadlock, I see a potential for Litecoin to help Bitcoin break through this deadlock. Litecoin can take a lead and be a positive force in the cryptocurrency space.” - Charlie Lee
As adoption of the soft fork has risen, so has the value of Litecoin. In the first week of April, Litecoin reached highs of over $12 for the first time since 2014. As of this writing, 75% of all Litecoin nodes have adopted SegWit, making such changes to the network imminent. Though the first segwit block was mined on April 12th by BW Pool, SegWit must maintain 75% support for a period of two weeks in order for the changes to officially take hold.
Not everyone in the community has been sympathetic with Charlie Lee’s goals, however. A number of mining pools and companies have spoken out against the SegWith soft fork, with some removing the support of their nodes from the network. In the event that more miners drop support in the coming two weeks, Charlie Lee has begun advocating for a UASF, or User Activated Soft Fork. A UASF would remove the power of consensus from miners, and allow Litecoins’ community of users to activate the fork themselves.
Vexation on both sides is likely to remain high as the scaling debate progresses. As Litecoin and Bitcoin work together to test and implement new ideas, the future of blockchain-based financial transactions will become steadily more apparent. New solutions and coins will likely emerge in order to placate any feature gaps that are inevitably left by one chain or the other. Though tensions will eventually dissipate on these issues, the block size debate is likely to remain a landmine of disputation for weeks or months to come. For now, whether segwit and lightning networks are viable solutions for scaling the Litecoin blockchain remains to be seen.