Optimizing Bitcoin transaction validation with segregated witness: a single-validation approach

The Bitcoin system has operated reliably for over 16 years, attracting considerable attention due to its decentralized architecture and the inherent value of its digital assets. Nevertheless, performance limitations, especially in transaction validation, continue to impede its scalability and efficiency. In the Bitcoin network, each full node not only needs to validate a transaction when it is first received, but also needs to validate it again when it is packaged into a new block. This redundant validation mechanism reduces the overall efficiency of the Bitcoin system. Utilizing Segregated Witness technology, this paper introduces a one-time validation optimization scheme. Specifically, we leverage the Witness Transaction ID (wtxid) inherent in SegWit to build a deterministic index mapping between the local transaction pool and new candidate blocks. By checking this index, the system can identify and skip the redundant verification of transactions that have already been validated upon entry into the pool. The proposed approach eliminates the need for secondary validation when processing new blocks, specifically for transactions already stored in the local transaction pool. Through comprehensive theoretical analysis, we demonstrate that this optimization can reduce the transaction validation overhead by approximately 50% without compromising the security of the Bitcoin network. In short, our research provides an innovative solution to Bitcoin’s performance challenges, thereby contributing to its future development and long-term sustainability.