Bitcoin developer Andrew Chow has added the Bitcoin Improvement Proposal (BIP) 174 to the GitHub Bitcoin repository. The technology was designed for partially signed Bitcoin transactions (PSBT), which enables users to send Bitcoin transactions when they have no internet connection.
Peter Wuille, Blocksteam‘s co-founder was the first one to propose the idea on which BIP 174 is based. Momentarily, this BIP has not been voted on or employed but could be of incredible use to Bitcoin users that have an internet connection prone to frequent downtime.
A PSBT generates the information required to perform a transaction sign in without the having the complete set of signatures for the input. This enables the sender to send cryptos while being offline seeing as all the necessary info will be incorporated in the transaction.
Once the internet connection has been reestablished again, the sender will be able to see the transaction up on the blockchain. In short, a PSBT lets the transactions to be sent without requiring the unspent transaction output (UTXO) database, which currently is required for transactions to go through.
In addition to being highly convenient for those that have a bad internet connection, PSBT will also enable partially-signed and unsigned Bitcoin transactions to be transferred more easily from one wallet to another to get multiple signatures. If those that want to sign in have different types of wallets this sometimes cannot happen because the protocol lacks a standard format for combining signatures.
BIPs usually have to undergo a thorough review and debate process before it can be added to Bitcoin’s software. The well-known Segregated Witness (SegWit) BIP led to such a big disagreement in the community that a small part of the Bitcoin community broke away from the main blockchain.
Adding PSBT to Bitcoin’s software will probably stir less controversy and debate than SegWit seeing as it will add to Bitcoin’s robustness and usefulness without changing the basics of Bitcoin’s protocol.