What is a covenant ID in Kaspa's KIP20?

A covenant ID is a consensus-tracked 32-byte identifier introduced by KIP20 that UTXOs carry to establish a stable lineage for covenant state. In Kaspa, UTXOs (unspent transaction outputs) are the fundamental units that hold funds; covenants are rules that can govern how those funds move. A covenant ID acts like a permanent serial number that follows covenant state as it passes from one output to the next across transitions — and because the consensus layer tracks it directly, no external proof is needed to verify the lineage. For a beginner, this means Kaspa can support covenant-based smart contract logic without forcing transactions to balloon in size with historical proof data.