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Bitcoin Improvement Proposal (BIP)

A Bitcoin Improvement Proposal (BIP) is a formal proposal to improve Bitcoin. It clearly describes a change someone wants to make to the network.

Last updated • 2 min read
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What is a Bitcoin Improvement Proposal (BIP)?

Bitcoin doesn’t have a company or organization that makes decisions about changes on its own. That’s why developers and users can suggest ideas through a BIP.

A BIP can cover new technical features, better rules for the network, or explanations and guidelines. Other developers discuss the proposal and give feedback. As a result, the proposal may change before moving forward.

BIPs have different statuses, such as draft, proposed, and final. Miners can signal that they support a proposal. They do this by adding a recognizable signal to the blocks they create. Not every BIP is eventually implemented.

An example of a Bitcoin Improvement Proposal (BIP)

SegWit is a well-known Bitcoin upgrade from BIP 141. This proposal changed how certain transaction data was stored.

This made more space available in a block. The example shows that a BIP is more than just an idea: an accepted proposal can change how Bitcoin works technically.

Why is a Bitcoin Improvement Proposal (BIP) important in crypto?

In news about Bitcoin upgrades, new features, or technical discussions, you may come across BIP numbers. A number like this refers to the document that describes a proposed change.

A BIP doesn’t automatically mean Bitcoin will change right away. The proposal must first be reviewed and get enough support. Then the change also needs to be implemented.

Some BIPs call for a change to Bitcoin’s rules. This can happen through a soft fork, where older software can usually still recognize new blocks. With a hard fork, the rules aren’t compatible, and the blockchain may split into two separate networks.

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