2025 Bitcoin protocol layer overview

Author: Zhixiong Pan Source: chainfeeds

The annual summary of Bitcoin Optech has always been regarded as a technical barometer of the Bitcoin ecosystem. It does not focus on price fluctuations, only recording the most authentic pulse of the Bitcoin protocol and key infrastructure.

The 2025 report reveals a clear trend: Bitcoin is undergoing a paradigm shift from “passive defense” to “active evolution.”

In the past year, the community has no longer been content with just patching vulnerabilities, but has begun to systematically address existential threats (such as quantum computing) and has aggressively explored the boundaries of scalability and programmability without sacrificing decentralization. This report is not only a memorandum for developers but also a key index for understanding the asset attributes of Bitcoin, network security, and governance logic over the next five to ten years.

Core Conclusions

Looking ahead to 2025, the technological evolution of Bitcoin presents three core characteristics, which are also the keys to understanding the following 10 major events:

1. Preemptive Defense: The defense roadmap against quantum threats has become clear and practical for the first time, with security thinking extending from the “present” to the “post-quantum era.”
2. Functional Layering: The high-density discussions of the soft fork proposal and the “hot-plug” evolution of the Lightning Network demonstrate that Bitcoin is achieving the architectural goal of “solid foundation at the bottom, flexibility at the top” through layered protocols.
3. Decentralized Infrastructure: From mining protocols (Stratum v2) to node validation (Utreexo/SwiftSync), a large amount of engineering resources has been invested in lowering the barriers to entry and enhancing censorship resistance, aiming to counteract the centralizing forces of the physical world.

The annual report of Bitcoin Optech covers hundreds of code submissions, heated discussions in mailing lists, and BIP proposals over the past year. To extract the real signals from the technical noise, I filtered out updates that are limited to “local optimizations” and selected the following 10 events that have structural impact on the ecosystem.

1. Systemic Defense Against Quantum Threats and the “Fortification Roadmap”

[Status: Research and Long-term Proposal]

The year 2025 marks a qualitative change in the Bitcoin community's attitude towards the threat of quantum computing, shifting from theoretical discussions to engineering preparations. BIP360 has been numbered and renamed to P2TSH (Pay to Tapscript Hash). This is seen as an important stepping stone for quantum resistance pathways, and more generally serves certain Taproot use cases (for example, commitment structures that do not require internal keys).

At the same time, the community is delving into more specific quantum-safe signature verification schemes, including the premise of introducing corresponding scripting capabilities in the future (such as reintroducing OP_CAT or adding new signature-related opcodes), constructing Winternitz signatures with OP_CAT, discussing making STARK verification a native scripting capability, and optimizing on-chain costs for hash signature schemes (such as SLH-DSA / SPHINCS+).

This topic occupies the top position because it touches on the mathematical foundation of Bitcoin. If quantum computing really undermines the Elliptic Curve Discrete Logarithm Assumption in the future (thereby threatening the security of ECDSA/Schnorr signatures), it will trigger systemic migration pressure and a security stratification of historical outputs. This forces Bitcoin to prepare upgrade pathways in advance at the protocol and wallet levels. For long-term holders, choosing custody solutions with upgrade roadmaps and a culture of security auditing, as well as paying attention to potential future migration windows, will become a required course for asset preservation.

2. Soft Fork Proposal Surge: Building the Cornerstone of “Programmable Vaults”

[Status: High-density Discussion / Draft Stage]

This year has been a high-density discussion year for soft fork proposals, with a core focus on how to release the expressive power of scripts while maintaining minimalism. Contract proposals such as CTV (BIP119) and CSFS (BIP348), as well as technologies like LNHANCE and OP_TEMPLATEHASH, are all attempting to introduce safer “restrictive clauses” for Bitcoin. Additionally, OP_CHECKCONTRACTVERIFY (CCV) has become BIP443, and various arithmetic opcode and script recovery proposals are also waiting for consensus.

These seemingly obscure upgrades are actually adding new “physical laws” to the global value network. They are expected to simplify, secure, and standardize native “Vaults” constructs, allowing users to set mechanisms such as delayed withdrawals and cancellation windows, thus achieving “programmable self-protection” from the perspective of protocol expressiveness. At the same time, these capabilities are expected to significantly reduce the interaction costs and complexity of second-layer protocols like the Lightning Network and DLC (Discrete Log Contracts).

3. The “Anti-Censorship” Reconstruction of Mining Infrastructure

[Status: Experimental Implementation / Protocol Evolution]

The decentralization of the mining layer directly determines Bitcoin's resistance to censorship. In 2025, Bitcoin Core 30.0 introduced an experimental IPC interface, significantly optimizing the interaction efficiency between mining pool software/Stratum v2 services and Bitcoin Core's verification logic, reducing reliance on inefficient JSON-RPC and paving the way for Stratum v2 integration.

One of the key capabilities of Stratum v2 is to further decentralize the transaction selection rights from the mining pool to a more distributed miner side (when mechanisms like Job Negotiation are enabled), thus enhancing censorship resistance. At the same time, the emergence of MEVpool attempts to address the MEV problem through blind templates and market competition: ideally, multiple marketplaces should coexist to prevent a single-point market from becoming a new centralized hub. This directly relates to whether ordinary users' transactions can still be fairly packaged in extreme environments.

4. Immune System Upgrade: Vulnerability Disclosure and Differential Fuzz Testing

[Status: Ongoing Engineering Operations]

The security of Bitcoin relies on self-checks before real attacks. In 2025, Optech recorded a large number of vulnerability disclosures targeting Bitcoin Core and Lightning implementations (such as LDK/LND/Eclair), ranging from fund freezing to privacy de-anonymization, and even severe theft risks. That year, Bitcoinfuzz utilized “Differential Fuzzing” technology, identifying over 35 deep bugs by comparing how different software reacted to the same data.

This high-intensity “stress test” is a sign of ecological maturity. It acts like a vaccine, exposing the underlying issues in the short term, but significantly enhancing the system's immunity in the long run. For users relying on privacy tools or the Lightning Network, this also serves as a wake-up call: no software is absolutely perfect, and keeping critical components updated is the simplest rule to ensure the safety of deposits.

5. Lightning Network Splicing: “Hot Update” of Channel Funds

[Status: Experimental Cross-Implementation Support]

The Lightning Network achieved a significant breakthrough in usability in 2025: Splicing (channel hot updates). This technology allows users to dynamically adjust funds (deposit or withdraw) without closing the channel. It currently has experimental support in the three major implementations: LDK, Eclair, and Core Lightning. Although the related BOLTs specifications are still being refined, significant progress has been made in cross-implementation compatibility testing.

Splicing is the key capability that allows for adding and subtracting funds without the need for a channel. It is expected to reduce payment failures and operational friction caused by the inconvenience of adjusting channel funds. In the future, wallets are expected to significantly lower the learning cost of channel engineering, allowing more users to use LN as a payment layer that is closer to a “balance account”. This is a crucial piece of the puzzle for Bitcoin payments to become widely used in daily life.

6. Verification Cost Revolution: Running Full Nodes on “Consumer Devices”

[Status: Prototype Implementation (SwiftSync) / BIP Draft (Utreexo)]

The decentralized moat lies in the cost of verification. In 2025, two major technologies, SwiftSync and Utreexo, launched a direct impact on the “full node threshold”. SwiftSync optimizes the UTXO set write path during IBD (Initial Block Download): it only adds to the chainstate when confirming that an output remains unspent at the end of IBD, and with the help of a “minimal trust” hints file, the IBD process in the sample implementation was accelerated by more than 5 times, while opening up space for parallel verification. On the other hand, Utreexo (BIP181-183) utilizes a Merkle forest accumulator, allowing nodes to verify transactions without locally storing the complete UTXO set.

The advancement of these two technologies means that running a full node on resource-constrained devices will become feasible, increasing the number of independent validators in the network.

7. Cluster Mempool: Reshaping the underlying scheduling of the fee market

[Status: Near Release (Staging)]

The implementation of Cluster Mempool in the anticipated features of Bitcoin Core 31.0 is nearing completion. It introduces structures such as TxGraph, abstracting complex transaction dependencies into a “transaction cluster linearization/sorting” problem that can be efficiently solved, making block template construction more systematic.

Although this is an upgrade to the underlying scheduling system, it is expected to enhance the stability and predictability of fee estimation. By eliminating abnormal packing orders caused by algorithm limitations, the future Bitcoin network will perform more rationally and smoothly during congestion, and users' accelerated transaction requests (CPFP/RBF) will also be effective under more certain logic.

8. Fine-grained governance of the P2P propagation layer

[Status: Strategy Update / Continuous Optimization]

In response to the surge of low-fee transactions anticipated in 2025, the Bitcoin P2P network has experienced a strategic turning point. Bitcoin Core 29.1 has lowered the default minimum relay fee to 0.1 sat/vB. At the same time, the Erlay protocol continues to advance to reduce node bandwidth consumption; additionally, the community has proposed initiatives such as “block template sharing” and continues to optimize the compact block reconstruction strategy to cope with the increasingly complex propagation environment.

Under policies that are more consistent and with lower default thresholds for nodes, the feasibility of low-fee transactions spreading within the network is expected to improve. These directions are expected to lower the rigid requirements for bandwidth on operating nodes, further maintaining the fairness of the network.

9. The “Tragedy of the Commons” Debate of OP_RETURN and Block Space

[Status: Mempool Policy Change (Core 30.0)]

Core 30.0 relaxed the policy restrictions on OP_RETURN (allowing more outputs, removing some size limits), which sparked intense philosophical debates about the use of Bitcoin in 2025. Note that this falls under Bitcoin Core's Mempool Policy (default forwarding/standard policy), not consensus rules; however, it will significantly affect whether transactions are easy to propagate and seen by miners, thus genuinely impacting the competitive landscape of block space.

Supporters believe this can correct incentive distortions, while opponents worry it may be seen as an endorsement of “on-chain data storage.” This debate reminds us that blockchain space, as a scarce resource, is subject to continuous negotiation of interests, including the rules of its use (even at non-consensus levels).

10. Bitcoin Kernel: Modular Refactoring of Core Code

[Status: Architecture Reconstruction / API Release]

Bitcoin Core took a key step in architecture decoupling in 2025: the introduction of the Bitcoin Kernel C API. This marks the separation of “consensus validation logic” from the large node program, becoming an independent, reusable standard component. Currently, this kernel can support external projects in reusing block validation and chain state logic.

“Kernelization” will bring structural security dividends to the ecosystem. It allows wallet backends, indexers, and analytical tools to directly call official verification logic, avoiding the risks of consensus discrepancies caused by reinventing the wheel. It's like providing a standardized “factory engine” for the Bitcoin ecosystem, making various applications built on it more robust.