[[Malleability]] posed a significant challenge for the Lightning Network. Because Lightning relies heavily on off-chain transactions, the ability to modify a TxID could potentially be exploited to disrupt payment channels or create fraudulent transactions. **The Soft-Fork Fix:** To address this issue, a soft-fork upgrade to the Bitcoin protocol called [[SegWit (Segregated Witness)]] was implemented in 2017. SegWit essentially separates transaction signatures from the main transaction data, making them tamper-proof and effectively eliminating transaction malleability.