Bitcoin Improvement Proposals (BIPs) are design documents that provide information to the Bitcoin community or describe a new feature for Bitcoin. They are intended to be a standard way of communicating ideas, improvements, and changes to the Bitcoin protocol and its ecosystem.

Purpose of BIPs

BIPs serve several important purposes:

  • Documentation:
    • BIPs document changes and improvements to the Bitcoin protocol, serving as a reference for developers and users.
  • Standardization:
    • They provide a standardized format for proposing new features, making it easier for the community to review and discuss them.
  • Community Engagement:
    • BIPs encourage community involvement and feedback, allowing users and developers to contribute to the evolution of Bitcoin.

Types of BIPs

BIPs are categorized into three main types:

  • Standards Track BIPs:
    • These proposals involve changes to the Bitcoin protocol or its operation, such as new features or improvements to existing ones.
    • Example: BIP 32, which introduces hierarchical deterministic wallets.
  • Informational BIPs:
    • These provide general guidelines or information to the Bitcoin community but do not propose changes to the protocol.
    • Example: BIP 101, which discusses Bitcoin scalability solutions.
  • Process BIPs:
    • These describe processes or changes to the processes used within the Bitcoin community, such as governance or decision-making.
    • Example: BIP 1, which outlines the BIP process itself.

How BIPs are Created

The process of creating a BIP involves several steps:

  1. Drafting:
    • A proposal is drafted in a markdown format, detailing the motivation, specification, and rationale for the proposed change.
  2. Review:
    • The draft is submitted for review by the community, often discussed on forums or mailing lists.
  3. Acceptance:
    • If the proposal gains sufficient support and consensus, it may be accepted and assigned a BIP number.
  4. Implementation:
    • The proposal is then implemented in the Bitcoin software, following the agreed specifications.