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BIP 174 (PSBT)
2,100 sats
Bitcoin Improvement Proposal (BIP) 174 introduced Partially Signed Bitcoin Transactions (PSBT) as a community standard. PSBT is a standardized format for communicating unsigned or partially signed Bitcoin transactions. PSBT was originally designed to enhance interoperability between wallets and other Bitcoin software, making it easier for a transaction to be constructed by one wallet, transferred to another for signing, and then transferred to a Bitcoin node for broadcasting. PSBT is also particularly useful for coordinating between parties who wish to sign the same transaction. For example, CoinJoin protocols and multisig outputs require multiple different actors to all sign the same transaction. The PSBT format provides a method for constructing the transaction, passing it between the different signers, and then assembling the final transaction to be broadcast. BIP 174 is currently widely adopted as a community standard, however it has several downsides, which are currently being addressed by a proposal for PSBT v2.
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