Matt Corallo Sees 80% Chance BIP-54 Becomes Bitcoin’s Next Soft Fork

Bitcoin developer Matt Corallo puts an 80% chance on BIP-54 becoming Bitcoin’s next soft fork, a proposal he sees as both a cleanup and a test of upgrade coordination.

The Great Consensus Cleanup was proposed in 2019 to address four defects that have persisted in Bitcoin’s consensus rules. The network has no formal schedule for the proposal. Taproot, activated in November 2021, was its most recent soft fork.

One targeted issue involves specially constructed blocks that can exploit node performance bottlenecks and slow validation. Another is a weakness in the roughly two-week difficulty adjustment period: miners controlling most of the network’s computing power can manipulate timestamps and speed up block production.

BIP-54 would also address ambiguity in Merkle proofs. A 64-byte transaction has the same size as an internal Merkle tree node, creating a theoretical way to forge proofs that could mislead light clients. The fourth issue involves historical design quirks that allowed duplicate coinbase transaction IDs; those duplicates could recur at future block heights and threaten existing coins or ledger accounting.

Corallo has described the issues as real risks, though not an immediate crisis. He also sees the proposal as a chance for Bitcoin developers to work through the social and political challenges of activating a soft fork and establish a process that can be reused for future soft forks.

Taproot’s activation followed months of debate over deployment, including whether miners should signal support or users should observe a mandatory flag day. Other protocol proposals, including OP_CAT (BIP-347) and OP_CHECKTEMPLATEVERIFY (BIP-119), have struggled to gain broad agreement, amid concerns that Bitcoin’s protocol is becoming harder to change.

Paul Sztorc, co-founder and CEO of LayerTwo Labs, criticized BIP-54 as a “janitorial maintenance fork” that “doesn’t do anything.” Sztorc said developers he surveyed at TABconf in Atlanta expected it to be Bitcoin’s next soft fork. The soonest activation estimate he heard was September 2027; most expected 2028 or later. No activation date has been set.