SetWit was first introduced by a developer named Pieter Wiulle at the Scaling Bitcoin conference in 2015. In his presentation, Wiulle said that by implementing a new protocol to bitcoin's core code that removes certain data normally recorded on its blockchain and storing that data outside the block, he could fix a bug in bitcoin's code called "transaction malleability," which allows anyone to change small details that modify the transaction's identifier, as well as its subsequent hash. Others praised this proposed protocol upgrade as a potential solution to bitcoin's relatively poor scalability; by implementing this upgrade, bitcoin would be able to process more transactions per second, because less data would be required in order to record a transaction in a given block. Because the protocol would also require less data to be imprinted on the blockchain to record a transaction, it could also process more transactions per second.
- What is SegWit?. Coindesk.