You must have heard the term Bitcoin Improvement proposal or BIP if you are into the cryptocurrency market. If not BIP, you must have heard SegWit, BIP 141 etc. which are a type of BIP.
What is BIP?
BIP stands for Bitcoin Improvement Proposal which is a document for bringing features and advancement to Bitcoin. Since the Bitcoin has no formal structure, the BIP has to give technical specifications for every feature it proposes to introduce and it’s rational. The term was first coined by Amir Takki in August 2011.
As the Bitcoin is now owned by any single person, anyone in the world can suggest a BIP and the whole community of miners, developers, investors and users of the Bitcoin community vote and decide upon the acceptance and implementation of the BIP.
3 Different Types of BIPs
The three types of BIPs are:
- Informational BIPs
These types of BIP proposes to make changes in the design, guidelines and supporting information of Bitcoin. These BIPs are just for the purpose of information and can be ignored by the community.
- Standard Track BIPs
Standard Track BIP make changes to the block, network protocol and the transaction validation process. These BIP affects the standard version of the Bitcoin and requires community consensus. These BIPs are applied in the Bitcoin protocol and cannot be ignored by the community at any cost.
- Process BIPs
Process BIPs suggest a change in the process of the BIP and require community consensus before being implemented. They cannot be ignored by the community and are similar to Standard Track BIPs. But, they are applied outside the Bitcoin protocol like BIP 2.
Some Important BIPs in the Bitcoin community
- SegWit (Segregated Witness)
SegWit was suggested by Bitcoin core developers in 2015 which aims to increase the network capacity of Bitcoin. Transaction malleability was also solved by the implementation of SegWit. SegWit means segregating the signatures of the witness from the transactions.
BIP91 was suggested by James Hilliard in May 2017 and proposed a process to activate the existing SegWit solution with a hash power majority.
There are many other BIPs in the Bitcoin community waiting to be approved.