Bitcoin Improvement Proposal BIP138 was merged into the Bitcoin Improvement Proposals repository on Sept. 21, but remains a Draft specification rather than a Bitcoin network change. It proposes an encrypted backup file for descriptors, wallet policies and other non-seed metadata that complex wallets may need to recover accounts and locate coins. A descriptor records public keys and spending rules, while a multisignature wallet requires more than one signer. Although a seed phrase can regenerate one signer’s private keys, losing the descriptor or a signer’s public key can prevent reconstruction of a multisig or miniscript wallet. The file must exclude private-key material before encryption. A holder of an eligible extended public key, or xpub (public key for deriving wallet addresses), could decrypt the backup without the seed, exposing public keys and script structure but not the private keys needed to sign. The draft excludes public keys directly present in a script and xpub roots that could be exposed by spending from serving as recovery keys. Its privacy warning is conditional: a wallet-service server that already knows an account xpub and later sees the same xpub reused as an eligible multisig key could read the backup if it obtained a copy, without gaining spending authority. The proposal describes a potential exposure, not a reported breach. A public Rust implementation with command-line build instructions exists. The BIP also says Liana uses an earlier backup format incompatible with the current BIP138 file. Related reading cited with the proposal concerns a Coldcard seed-generation flaw that could let attackers recreate private keys by pressing a button, a Bitcoin mobile privacy feature that can make incoming money invisible, and popular wallets potentially losing support for new hardware devices after a critical security bridge stopped accepting new devices.