Overview

BTC Thunderbolt is an experimental protocol upgrade aimed at boosting Bitcoin’s performance, currently being tested by the Nubit team in an independent environment since April 15, 2025. It is not yet part of the Bitcoin mainnet.

Thunderbolt proposes soft forks like UTXO Bundling and OP_CAT to increase transaction speed and network capacity while improving Bitcoin’s programmability. Its main goal is to enhance transaction efficiency and support complex applications such as DeFi and smart contracts.

Thunderbolt also seeks to address Bitcoin’s scalability issues, enabling it to handle high-frequency trading and diverse on-chain applications better.

Source: https://www.nubit.org/

Funding Information

Founded by UC Santa Barbara Professor Yu Feng, Nubit completed two funding rounds in 2024.

A $3 million Pre-seed round closed on March 26, followed by an $8 million Seed round led by Polychain Capital, with participation from Nomad Capital and Spartan Group, bringing the total to $12 million.

These funds will help Nubit build a secure, scalable Data Availability (DA) layer and advance its applications in AI, SocialFi, and GameFi across multiple chains.

Source: https://medium.com/nubit-official/polychain-leads-8m-seed-round-for-nubit-to-enhance-blockchain-scalability-and-multi-chain-bea6c98eb46e

Understanding Soft Forks

In blockchain, a fork occurs when a network splits due to changes in its rules or protocol.

Hard forks create incompatibility between new and old nodes, potentially leading to a new blockchain, while soft forks are backward compatible, allowing old nodes to verify new rules, but new features are only available to upgraded nodes.

Bitcoin’s soft forks typically optimize performance, enhance security, or introduce new features. The Thunderbolt soft fork, led by Nubit, aims to overcome Bitcoin’s bottlenecks in transaction speed, programmability, and asset issuance while preserving decentralization.

Core Technology

Thunderbolt introduces UTXO Bundling and OP_CAT to improve Bitcoin’s functionality and scalability.

These technologies are still experimental and not yet adopted by the Bitcoin mainnet, currently running only in Nubit’s test environment.

1. UTXO Bundling

UTXO (Unspent Transaction Output) is central to Bitcoin’s transaction model, where each transaction consumes old UTXOs and generates new ones.

As transaction volumes increase, the UTXO set grows, resulting in higher storage and verification costs. UTXO Bundling optimizes transaction structures by bundling multiple UTXOs, reducing data redundancy, improving efficiency, lowering fees, and enhancing network capacity.

Thunderbolt claims to boost transaction speed nearly tenfold compared to traditional Bitcoin, facilitating high-frequency trading and large-scale applications, though this remains unverified and requires further evaluation. This technology lacks an official BIP number and is an experimental proposal by Nubit.

Source: https://www.investopedia.com/terms/u/utxo.asp

2. OP_CAT

OP_CAT is a script opcode that concatenates data segments.

Disabled in 2010 due to security risks like stack overflow attacks, its reintroduction needs community consensus.

Thunderbolt aims to reintroduce and optimize OP_CAT, enhancing Bitcoin’s native programmability. This soft fork proposal allows for complex logic in Bitcoin scripts, enabling on-chain asset issuance, transaction introspection, and smart contract deployment.

Success would enable developers to create richer decentralized applications (DApps) on Bitcoin, such as DeFi protocols or NFT platforms, expanding its use cases.

Source: https://medium.com/nubit-official/bitcoin-thunderbolt-is-live-a-native-upgrade-to-the-bitcoin-network-7b84039b3acb

Timeline of Key Events in the Evolution of Bitcoin Script Opcodes

This timeline highlights significant events, shifts in community consensus, and technical impacts regarding Bitcoin opcodes, particularly focusing on the disabling and reactivation proposals of OP_CAT since 2010. It illustrates the transition from centralized to decentralized governance in Bitcoin’s scripting language and its effects on Bitcoin’s functionality and smart contract capabilities.

Through these milestones, the community has gradually formed a consensus on the importance of security, scalability, and innovation, driving the recovery and enhancement of Bitcoin script opcodes.

Operational Overview

Bitcoin Thunderbolt is an experimental initiative by the Nubit team, designed to enhance the performance and programmability of the Bitcoin mainnet via a soft fork. It’s crucial to understand that Thunderbolt is not a consensus upgrade to the Bitcoin main chain; instead, it’s an experimental network deployed in an independent test environment without broad support from core developers, miners, or nodes.

The project introduces UTXO Bundling to improve transaction throughput and reduce on-chain costs, while attempting to reintroduce the OP_CAT opcode to enhance script logic capabilities, paving the way for native DeFi and smart contracts.

Thunderbolt integrates protocols like BRC-20, Runes, and Ordinals, proposing a unified asset management framework called Goldinals. It also launches BitMM, an on-chain automated market-making mechanism, within the test network, exploring trustless native asset liquidity solutions.

While Thunderbolt showcases potential extensions of Bitcoin’s functionality, it remains in its early stages and has not yet been formally integrated into the Bitcoin mainnet. Its actual impact awaits further validation through community consensus and time.

Source: https://www.nubit.org/

Participation Guidelines

To engage with the Bitcoin Thunderbolt ecosystem, here are actions you can take based on your role:

For Regular Users:
Obtain an invitation code (Boosting Code) by applying through @nubit_org’s Discord or X activities (e.g., @trackoor’s DM).
Use supported wallets (e.g., UniSat wallet, OKX Wallet) to access the network and experience BTC transactions or asset packaging. Be cautious of test network risks; using non-mainnet wallets might involve experimental features, so proceed carefully.

Stay updated with @ nubit_org and join community activities to earn rewards.

Source: https://thunderbolt.lt/

For Developers:
Visit Nubits’ GitHub or documentation to learn how to develop dApps or DeFi protocols using OP_CAT and UTXO Bundling.
Join the Discord community to collaborate with other developers.

For Institutions (like banks or enterprises):
Contact Nubit or similar partners to explore tokenized assets, cross-border payments, or RWA integration.
Leverage Thunderbolt’s efficiency and programmability to create tailored financial solutions.

Source: https://x.com/aiqiqi77/status/1912173206791737432

Comparing Scaling Solutions

Bitcoin Thunderbolt is an experimental on-chain scaling solution that enhances transaction speed and programmability through UTXO Bundling and OP_CAT soft forks, claiming to be 10 times faster than traditional Bitcoin, suitable for DeFi and on-chain asset management, while maintaining high decentralization.

In contrast, the Lightning Network focuses on off-chain micropayments, offering high throughput but complex management; sidechains like Rootstock and Liquid support smart contracts but have low decentralization; Drivechain and Hacash provide innovative multi-layer expansion but have low adoption; Ordinals lean more towards asset issuance rather than scaling.

Thunderbolt seeks a balance between performance and decentralization, but its actual effectiveness and community acceptance remain to be verified, making it suitable for users pursuing on-chain functionality expansion.

Source: https://www.brc-20.io/

Challenges

Despite the benefits brought by the Thunderbolt soft fork, its deployment and application may face some challenges:

1. Technical Perspective

Still in experimental stage: UTXO Bundling and OP_CAT are currently at the proposal or testing stage. OP_CAT is only a BIP-347 draft, and UTXO Bundling has no BIP number yet. Thunderbolt runs only in its self-built environment and has not yet connected with the Bitcoin mainnet.

Scalability challenges: Although Thunderbolt claims to increase transaction speed to 10 times that of the Bitcoin mainnet, on-chain optimization may increase nodes’ bandwidth and storage burden. In high transaction volume scenarios, it may affect network synchronization efficiency, posing scalability risks.

Insufficient development ecosystem: Even if OP_CAT is eventually adopted, supporting complex dApps and DeFi protocols (like BitMM) still requires a sound development toolchain and documentation support. The current ecosystem is immature, and building an active developer community remains challenging.

2. Market Perspective

Community Acceptance: The Bitcoin community is generally cautious about protocol changes due to concerns over potential impacts on security and decentralization. Thunderbolt must persuade miners, node operators, and users to support its soft fork. Historical controversies over forks (like Bitcoin Cash) highlight the risk of community division.

Source: https://www.investopedia.com/tech/history-bitcoin-hard-forks/

User Participation Barriers: Access to Thunderbolt requires an invitation code (Boosting Code), limiting ordinary users’ participation. The competitive invitation mechanism (such as @nubit_org’s Discord events) could hinder market penetration and slow down user base growth.

Competitive Pressure: Thunderbolt faces competition from existing Layer 2 solutions (like the Lightning Network) and programmable blockchains like Ethereum. Its on-chain optimizations and DeFi features (such as BitMM) must outperform rivals to attract users and developers.

3. Compliance Perspective

Regulatory Scrutiny: Thunderbolt has been mentioned only in HSBC’s internal briefings, with no public announcements or official partnerships confirmed. Publicly declaring partnerships could draw attention from global regulators, especially in regions with stringent cryptocurrency regulations. Meeting compliance requirements like KYC/AML would also add significant operational complexity.

Cross-border Compliance Challenges: If Thunderbolt involves cross-border payments and asset tokenization, it will need to navigate various countries’ financial regulatory systems. Coordinating compliance standards globally is a critical challenge for achieving a large-scale application.

Institutional Integration Risks: Should traditional financial institutions become deeply involved, they might demand Thunderbolt comply with higher standards, such as data protection and transaction transparency. These requirements could conflict with Bitcoin’s decentralization principles, affecting its ecosystem’s growth path.

History of Bitcoin Forks

Since 2015, the Bitcoin network has seen multiple fork attempts focused on scaling and technical upgrades, classified into soft forks and hard forks:

Soft forks tighten rules in a backward-compatible way, typically activated gradually through community consensus without splitting the chain;

Hard forks change rules incompatibly and, without broad consensus, can easily lead to network splits and new chains.

This table summarizes major Bitcoin fork events from 2015 to 2023, categorized by time, type, background, community acceptance, and impact, providing insights into the evolution of Bitcoin governance and consensus mechanisms.

SegWit Activation Rate Curve Analysis

SegWit (Segregated Witness, BIP 141) was activated via a soft fork on August 24, 2017. Its activation rate curve reflects the dynamics of coordination and conflict within the Bitcoin community from 2016 to 2017.

The following is a detailed analysis of the 2017 SegWit activation rate curve, based on historical data and community events, combined with the context of mining pool signal support.

Source: https://github.com/bitcoin/bips/blob/master/bip-0141.mediawiki

History of Bitcoin Protocol Upgrades

Since the release of Bitcoin Core 0.1 in 2009, Bitcoin has evolved from a simple peer-to-peer electronic cash system into a decentralized network supporting smart contracts and enhanced privacy features. Its technological advancements have been primarily driven by community-driven Bitcoin Improvement Proposals (BIPs) and Bitcoin Core upgrades, covering consensus mechanisms, scripting systems, scalability, security, and more.

The table below outlines the key technical milestones from Bitcoin Core 0.1 to the 2021 Taproot upgrade, succinctly showcasing the development trajectory of the Bitcoin protocol and the enhancements to network functionality and user experience at each stage.

Source: https://bitcoinops.org/en/topics/taproot/

Future Outlook

1. Technical Outlook

Enhancing Programmability: If OP_CAT is successfully launched, it will significantly enhance the expressiveness of Bitcoin’s scripting system, supporting more complex conditional logic and smart contracts. This will enable on-chain AMM (BitMM), decentralized identity (BitVisa), and other native applications. This could lead to the development of lending protocols, stablecoins, NFT platforms, and further expand Bitcoin’s functional boundaries.

Improving Scalability: If UTXO Bundling is adopted, transaction confirmation times could be reduced to seconds (target 2.897 seconds), meeting the needs of high-frequency, high-throughput scenarios such as micropayments and on-chain finance.

Stimulating Development Ecosystem: With tools, documentation, and community support provided by Nubit (e.g., GitHub, Discord), if Thunderbolt is eventually deployed on the mainnet, it may attract more developers to participate in the Bitcoin ecosystem, promoting the construction of rich DeFi and Web3 applications, narrowing the gap with the Ethereum ecosystem.

It’s worth noting that if OP_CAT does not gain community support, Thunderbolt may remain limited to the test network, with limited impact. Given the high security and broad consensus required for Bitcoin protocol changes, the likelihood of new proposals being formally adopted in the short term is low.

Source: https://github.com/RiemaLabs

2. Market Outlook

Mainstream Financial Integration: If more financial institutions (such as JPMorgan) join, it will drive Thunderbolt’s application in tokenized assets, cross-border payments, and the RWA (Real World Assets) market.

Expanding User Base: With the optimization of the invitation code mechanism (such as broader community activities) and wallet integration (gate.io, OKX), Thunderbolt is expected to lower participation barriers, attract retail and institutional users, and build an active user ecosystem.

3. Compliance Outlook

Creating a Regulatory-Friendly Environment: If Thunderbolt can partner with traditional institutions like banks to develop solutions that adhere to KYC/AML standards, such as BitVisa’s on-chain identity verification, it could fulfill global regulatory requirements and build trust in mainstream financial systems.

Establishing a Global Compliance Framework: Collaborating with international projects like Project Agora to set compliance standards for cross-border payments and tokenized assets could facilitate Bitcoin’s integration into legitimate financial systems worldwide.

Source: https://www.bis.org/about/bisih/topics/fmis/agora.htm

Conclusion

Bitcoin Thunderbolt is an ambitious experiment that aims to enhance Bitcoin’s performance and programmability.

Fifteen years after Bitcoin was created, its core protocol remains robust but faces challenges like limited transaction capacity and a constrained scripting system. Thunderbolt aims to address these issues by proposing several innovative yet controversial soft forks.

These proposals could increase transaction efficiency and support more complex on-chain logic, potentially enabling native DeFi, NFTs, on-chain asset issuance, and cross-chain communication within the Bitcoin ecosystem.

Currently, Thunderbolt is only operational on Nubit’s test network and lacks broad consensus from the Bitcoin mainnet community. Changes to Bitcoin’s consensus rules require a thorough BIP (Bitcoin Improvement Proposal) process, involving extensive community discussions, testing, and eventual activation.

As of 2025, no new consensus rules have been adopted on the Bitcoin main chain, reflecting the community’s cautious stance on protocol changes. Thunderbolt faces significant uncertainty in becoming an official mainnet upgrade.

Despite this, Thunderbolt has sparked new discussions about Bitcoin’s scalability, encouraging developers and researchers to explore the potential of a more programmable Bitcoin. Whether it is ultimately adopted or not, its ideas and technical trials will leave a significant mark on Bitcoin’s evolution.