diff --git a/02-peer-protocol.md b/02-peer-protocol.md
index 38e2b72ac..7bd81682b 100644
--- a/02-peer-protocol.md
+++ b/02-peer-protocol.md
@@ -199,6 +199,14 @@ This message contains a transaction input.
     * [`u32`:`prevtx_vout`]
     * [`u32`:`sequence`]
 
+1. `tlv_stream`: `tx_add_input_tlvs`
+2. types:
+    1. type: 0 (`prevtxout`)
+    2. data:
+        * [`sha256`:`txid`]
+        * [`u64`:`amount_satoshis`]
+        * [`...*byte`:`scriptpubkey`]
+
 #### Requirements
 
 The sending node:
@@ -206,6 +214,8 @@ The sending node:
   - MUST use a unique `serial_id` for each input currently added to the
     transaction
   - MUST set `sequence` to be less than or equal to 4294967293 (`0xFFFFFFFD`)
+  - If the input is using segwit version 1 or greater:
+    - MAY omit `prevtx` and send `prevtxout` instead
   - MUST NOT re-transmit inputs it has received from the peer
   - if is the *initiator*:
     - MUST send even `serial_id`s
@@ -216,11 +226,12 @@ The receiving node:
   - MUST add all received inputs to the transaction
   - MUST fail the negotiation if:
     - `sequence` is set to `0xFFFFFFFE` or `0xFFFFFFFF`
-    - the `prevtx` and `prevtx_vout` are identical to a previously added
-      (and not removed) input's
-    - `prevtx` is not a valid transaction
+    - `prevtx` and `prevtxout` are both missing
+    - `prevtx` is provided and is not a valid transaction
     - `prevtx_vout` is greater or equal to the number of outputs on `prevtx`
-    - the `scriptPubKey` of the `prevtx_vout` output of `prevtx` is not exactly a 1-byte push opcode (for the numeric values `0` to `16`) followed by a data push between 2 and 40 bytes
+    - the spent outpoint is identical to a previously added (and not removed) input's
+    - the `scriptpubkey` of the `prevtx_vout` output of `prevtx` is not exactly a 1-byte push opcode (for the numeric values `0` to `16`) followed by a data push between 2 and 40 bytes
+    - the `scriptpubkey` of `prevtxout` is not exactly a 1-byte push opcode (for the numeric values `1` to `16`) followed by a data push between 2 and 40 bytes
     - the `serial_id` is already included in the transaction
     - the `serial_id` has the wrong parity
     - if has received 4096 `tx_add_input` messages during this negotiation
@@ -235,6 +246,9 @@ Inputs in the constructed transaction MUST be sorted by `serial_id`.
 
 `prevtx` is the serialized transaction that contains the output
 this input spends. Used to verify that the input is non-malleable.
+When using segwit version 1 or higher, we only need to provide the
+`prevtxout` instead: this is particularly useful when the previous
+transaction is too large to be included in a lightning message.
 
 `prevtx_vout` is the index of the output being spent.