To Litecoin miners and pool operators,
As you all know, the Litecoin developers and I worked on adding SegWit to Litecoin last year. We have taken tremendous efforts on it in order to help Litecoin rise again and wished that miners and pools would support this and signal for SegWit. As it turned out, we have not done a good job at convincing you why SegWit is good for Litecoin. I hope this letter can help.
First of all, a lot of criticism about SegWit comes from Bitcoin's perspective. SegWit is not a good scaling solution. I agree. It is not. Litecoin, currently, is not running into a block size problem. Litecoin has 4 times the capacity of Bitcoin, so it likely won't run into any capacity issues for many years. Our reasoning for adding SegWit is not because of it's small block size bump. SegWit has a fix for transaction malleability, which lets us add new technologies like Lightning Networks. SegWit also opens up the possibility of adding many other improvements like Schnorr signatures or Confidential Transactions. All of these improvements are going to help Litecoin tremendously. And with Bitcoin stalling due to the block size scaling deadlock, Litecoin can really shine if we can get SegWit on Litecoin.
People also complain about the complexity of SegWit code. I don't think miners or pools need to worry about that. The Litecoin development team is comfortable with the SegWit code and we never have any trouble about it. In a healthy ecosystem, each party contributes its best. We are confident in what we do best, coding. We also welcome you introducing more talents to join our development team.
Xinxi Wang has worked hard to set up a Litecoin Foundation. We will work towards getting funding for it so that we can hire a few full-time Litecoin developers. I will be the Managing Director and I will work with the Litecoin development team to improve Litecoin. However, a lot of what we want to work on depends on SegWit being activated. PZ is also in the process of setting up a foundation in the Cayman Island. I expect this might also help Litecoin and the development team in the future.
I also believe that the market is waiting for Litecoin to get SegWit and the price will react positively if SegWit is activated. Seeing all these other altcoins pump is definitely disheartening. So let's give the market what it wants.
For concerns about on-chain scaling, I understand your concerns. I promise you if and when the need arises for Litecoin to scale on-chain, the Litecoin developers and I will execute a hard fork to increase max block size for Litecoin.
Lastly, I plan to travel to China in June and want to meet with as many of the Chinese miners and pool operators as possible. I would love to hear your opinions about what you think the Litecoin development team should work on next. And at that time, I would much rather talk to you about new Litecoin features as oppose to still trying to convince you about SegWit.
I hope you will trust in me, my vision, and the Litecoin development team. We all want the best for Litecoin and we are all in this together. Let Litecoin take the lead!