[SXX]

Blockchain remains, but it's will only contain hash of transaction script. Actual transaction script body which is heavy and take most of space in blockchain will go into separate extended block. This reduces size of transactions in main chain.

You might want to check this 5 minute segregated witness explained video:

https://youtu.be/OFfBRzh9HmU

Or this 50 minute presentation from actual Bitcoin developer and initiator of segwit:

https://youtu.be/NOYNZB5BCHM

[Laforet]

The 5 minute video is extremely misinformed if not outright wrong. There is no such thing as an "extended block" in the current form of Segwit[0].

I've linked to a better explanation down below. It does run 12 minutes but you only need to watch the first 3 minutes for a technical answer.

https://www.youtube.com/watch?v=DzBAG2Jp4bg

[0]:https://www.reddit.com/r/Bitcoin/comments/65uriv/a_simplifie...