BIP-119 is a proposal designed to introduce recurring spending conventions to Bitcoin, in order to optimize transaction scheduling within the network.
Jeremy Rubin, developer of Bitcoin and the BIP-119 improvement proposal, notes that this proposal is ready for implementation within the network blockchain this year, so it is possible that users of this cryptocurrency will soon be able to program the way in which they want to spend their holdings in BTC.
On GitHub, Rubin explained that BIP-119 introduces a new way to spend BTC beyond ownership of the private key. Such functionality is possible through so-called “agreements.” Let’s see what this interesting improvement proposal for Bitcoin is all about.
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What is BIP-119?
The BIP-119 improvement proposal introduces so-called “conventions” to Bitcoin, which can be useful for building smart contracts within the network, the developer explained. Conventions allow for a limited but very valuable set of use cases for Bitcoin, without implying significant risk to the network.
BIP-119 would introduce the Bitcoin Script code, OP_CHECKTEMPLATEVERIFY (OP_CTV) to the Bitcoin protocol. Thanks to it, a recurring spending scheme can be created on our BTC if we so wish. In this way, the proposal allows users to define the way in which they want their bitcoins to be spent in the future. For example, it is possible to specify the amount, the exact moment, and the number of times we want to send value to an address or a set of BTC addresses. This proposed improvement makes it easier to schedule transactions, individually or in batches, at a time when the network experiences greater use and demand and, therefore, greater congestion.
Cryptocurrency exchanges can benefit greatly from this proposition, sending large batches of BTC transactions at very low costs.
Improvements and use cases for Bitcoin
While the arrival of BIPs on Bitcoin may not have as much media coverage as the Taproot upgrade, which was rolled out to mainnet last November to introduce significant improvements to the network’s privacy and security, Rubin highlights that BIP-119 will help Bitcoin become a more programmable, automatable, efficient, and secure network. First, BIP-119 will significantly help improve transaction congestion, making Bitcoin faster and cheaper.
The programming capabilities of this blockchain will also be optimized with the introduction of this improvement proposal to the mainnet. In the case of transactions multi-signaturesRubin points out that with OP_CTV it is possible to build a payment channel from which either party can exit without requiring the signatures of both, as occurs in traditional payment channels.
BIP-119 will also enable scalability protocol nodes Lightning Network make much more secure and efficient use of hash-time locked contracts (HTLCS). It will also make Bitcoin's security and privacy stronger, giving developers the possibility to build new variants of smart vaults that provide greater security and efficiency to cold storage solutions. In these cases, users can configure a single BTC withdrawal address. Thus, in case of loss or theft of a hardware device, a third party will have no way of accessing the funds stored on it.
Another advantage that this proposal has for Bitcoin is the introduction of the Sapio smart contract programming language.
Proposal for activation of BIP-119
Rubin noted that the lack of knowledge about this proposed improvement, the complexity of the agreements and a certain risk of introducing fungibility discriminators have been the main obstacles to its implementation in Bitcoin, since it was first introduced in 2020. However, at the end of 2021, Rubin highlighted that the proposed improvement was ready for its arrival on the blockchain network.
Currently, BIP-119 has the backing and support from various developers, companies and members of the crypto community. These include the developers of Bitcoin Core, mining pools, Bitcoin-related companies and key contributors to the network, such as: Alex Thorn, Head of Research at Galaxy Digital; Ben Carman, from The Bitcoin Company; Charlie Lee, Founder of Litecoin; Olaoluwa Osuntokun, CTO of Lightning Labs, among others.
For its activation, Rubin proposed using a mechanism similar to the one used for the implementation of the Taproot update in Bitcoin. At the beginning of January, Rubin presented a rewards program, which already has 3,6 BTC from the community, to encourage the detection of errors or vulnerabilities present in BIP-119.
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