Bitstamp Plays With Novelty Segwit Only Bech32 Addresses

Bitstamp has annouced the addition of novelty segwit only Bech32 addresses to their platform (archived). Segwit involves cleaving the ever important transaction signatures from inclusion in Bitcoin blocks through a set of rules precariously enforced at the convenience of miners. With the signatures cleaved, transactions opting for the lower segwit security standard feature a space saving "spend by anyone" script when added to the Bitcoin blockchain.

On at least one altcoin forked off of Bitcoin where miners don't happen to agree to segwit rules, miners sweep the balance of Segwit addresses as a supplemental revenue stream (archived). Bech32 addresses can be identified by beginning with the bc1 prefix rather than 1, as strong public key hash addresses do or 3, as weaker pay to script hash addresses including earlier segwit addresses do. Unlike traditional bitcoin public key hash addresses, the security of balances held in segwit addresses is reduced in proportion to the total balance held across all segwit addresses.

Back in 2015 Bitstamp suspended operations and requested users cease making deposits to their addresses after a minimum of 18,867.62695929 BTC left Bitstamp's hot wallet.

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