This is a specific implementation of the "nuclear option" soft fork (or "firm-fork").

The problem with any hard-fork (like) change is that there is an incentive to add as much as possible and then the process gets bogged down.

Since the POW is based on the header 1, you could make header 3 expandable.  This would allow adding new fields later.

This could be used for other block commitments.  This would save having to make the merkle tree a sum tree immediately.  At a later time, the sum-tree root could be added. (I think you also need to commit the path to the first entry in the sum-tree, in order to get compact proofs).  There could be separate sum-trees for each counter (sigops, block size, tx count, sighash?)

Having a dedicated hard fork and soft fork counter is a good idea.  There should also be a field for parallel soft forks.  Incrementing the soft fork counter could set the bitfield soft forks back to zero.  Ideally, each soft fork would have a yes and no bit.  If > 50% vote No, then it fails adoption.

The effect of this change is that nodes react to hard forks by stalling the chain.  The hard fork counter means that the new rules could be that nodes should do that going forward for all new hard forks.

- soft fork (bitfield or count) => warn user that a soft fork has happened

- hard fork count increase => warn user that update is required and don't process any more blocks

This means that header3 should be kept as simple as possible.

• 2 bytes: hardfork block version
• 2 bytes: softfork block version
• 4 bytes: softfork bitfields
• 32 byte: hash(header4)

Header4 and everything else in the block could be changed when a hard fork happens.  The merged mining rules and header3 would be fixed.

I think confirmation counts should be based on even numbers, i.e. 3800 of 4000, but that is an aesthetic issue and doesn't really matter.

A section on recommendations for the different client types would be useful.

If 1000 of the last 2000 blocks are votes for a hard fork, then warn the user that a hard fork is being considered

If 4000 of the last 4463 blocks are votes for a hard fork, then warn the user that a hard fork is likely to occur within the next few days

If a hard fork happens:

- shut down transaction processing
- inform the user that a hard fork has happened

Non-upgraded miners could blacklist the hard forking block and keep mining on their own chain.  Their chain would never reach the threshold to trigger the hard fork.  It would max out at 4323 blocks of the last 4463.

Ironically, if users did this, it would defeat some of the benefit of using the hard fork field.

Users should definitely be given the option of accepting or rejecting the hard fork.  Otherwise, miners can hard-fork at will, which isn't desirable.