[
] historical transaction records are basically like building blocks upon which all future transaction records depend. If that's the case, my worry is that if they change something fundamental about Bitcoin protocol, could it potentially create the necessity to go back and rewrite the entire history of transactions from the very beginning? [
]
That would be one possibility. Another is to determine a new blockchain format that is valid starting with block #123456. All blocks before that block would use the current, old format, all blocks #123456 and after would use the new format.
Another problem is that changes that are incompatible with current clients create a fork. To go through a fork without too many problems we want to have a large majority of miners and bitcoin client programmers on one side. They all have to agree on the change. Then a cut-over date is determined, all software is changed such that it changes to the new functionality on that date, and the dissenting minority is left with a non-viable branch of the fork.
The problem here is to get a large majority to agree on something. Humans are generally not as cooperative as I think they should be.
An example of such a change (overdue in my view) would be to determine that every wallet needs a transaction at least every 2 years. Then all blocks older than 2 years are pruned from the blockchain. This would also open the possibility to replenish lost bitcoins.