diff --git a/CHANGELOG.md b/CHANGELOG.md
index b5792195d..f0093ba92 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -1,3 +1,18 @@
+# 5.7.3
+
+SMP/NTF protocol:
+- add ALPN for handshake version negotiation, similar to XFTP (to preserve backwards compatibility with the old clients).
+- upgrade clients to versions v7/v2 of the protocols.
+
+SMP server:
+- faster responses to subscription requests.
+
+XFTP client:
+- fix network exception during file download treated as permanent file error.
+
+SMP agent:
+- do not report subscription timeouts while client is offline.
+
 # 5.7.2
 
 SMP agent:
diff --git a/package.yaml b/package.yaml
index 7a536f7bf..6d63ad488 100644
--- a/package.yaml
+++ b/package.yaml
@@ -1,5 +1,5 @@
 name: simplexmq
-version: 5.7.2.0
+version: 5.7.3.1
 synopsis: SimpleXMQ message broker
 description: |
   This package includes <./docs/Simplex-Messaging-Server.html server>,
diff --git a/simplexmq.cabal b/simplexmq.cabal
index aa008f600..494602941 100644
--- a/simplexmq.cabal
+++ b/simplexmq.cabal
@@ -5,7 +5,7 @@ cabal-version: 1.12
 -- see: https://github.com/sol/hpack
 
 name:           simplexmq
-version:        5.7.2.0
+version:        5.7.3.1
 synopsis:       SimpleXMQ message broker
 description:    This package includes <./docs/Simplex-Messaging-Server.html server>,
                 <./docs/Simplex-Messaging-Client.html client> and
diff --git a/src/Simplex/Messaging/Server.hs b/src/Simplex/Messaging/Server.hs
index 4195bffba..156f5da18 100644
--- a/src/Simplex/Messaging/Server.hs
+++ b/src/Simplex/Messaging/Server.hs
@@ -53,7 +53,7 @@ import Data.Either (fromRight, partitionEithers)
 import Data.Functor (($>))
 import Data.Int (Int64)
 import qualified Data.IntMap.Strict as IM
-import Data.List (intercalate)
+import Data.List (intercalate, mapAccumR)
 import Data.List.NonEmpty (NonEmpty (..))
 import qualified Data.List.NonEmpty as L
 import qualified Data.Map.Strict as M
@@ -429,7 +429,7 @@ smpServer started cfg@ServerConfig {transports, transportConfig = tCfg} = do
                     hPutStrLn h "AUTH"
 
 runClientTransport :: Transport c => THandleSMP c 'TServer -> M ()
-runClientTransport th@THandle {params = thParams@THandleParams {thVersion, sessionId}} = do
+runClientTransport h@THandle {params = thParams@THandleParams {thVersion, sessionId}} = do
   q <- asks $ tbqSize . config
   ts <- liftIO getSystemTime
   active <- asks clients
@@ -440,11 +440,12 @@ runClientTransport th@THandle {params = thParams@THandleParams {thVersion, sessi
     pure new
   s <- asks server
   expCfg <- asks $ inactiveClientExpiration . config
+  th <- newMVar h -- put TH under a fair lock to interleave messages and command responses
   labelMyThread . B.unpack $ "client $" <> encode sessionId
-  raceAny_ ([liftIO $ send th c, client thParams c s, receive th c] <> disconnectThread_ c expCfg)
+  raceAny_ ([liftIO $ send th c, liftIO $ sendMsg th c, client thParams c s, receive h c] <> disconnectThread_ c expCfg)
     `finally` clientDisconnected c
   where
-    disconnectThread_ c (Just expCfg) = [liftIO $ disconnectTransport th (rcvActiveAt c) (sndActiveAt c) expCfg (noSubscriptions c)]
+    disconnectThread_ c (Just expCfg) = [liftIO $ disconnectTransport h (rcvActiveAt c) (sndActiveAt c) expCfg (noSubscriptions c)]
     disconnectThread_ _ _ = []
     noSubscriptions c = atomically $ (&&) <$> TM.null (subscriptions c) <*> TM.null (ntfSubscriptions c)
 
@@ -477,10 +478,10 @@ cancelSub sub =
     _ -> return ()
 
 receive :: Transport c => THandleSMP c 'TServer -> Client -> M ()
-receive th@THandle {params = THandleParams {thAuth}} Client {rcvQ, sndQ, rcvActiveAt, sessionId} = do
+receive h@THandle {params = THandleParams {thAuth}} Client {rcvQ, sndQ, rcvActiveAt, sessionId} = do
   labelMyThread . B.unpack $ "client $" <> encode sessionId <> " receive"
   forever $ do
-    ts <- L.toList <$> liftIO (tGet th)
+    ts <- L.toList <$> liftIO (tGet h)
     atomically . writeTVar rcvActiveAt =<< liftIO getSystemTime
     (errs, cmds) <- partitionEithers <$> mapM cmdAction ts
     write sndQ errs
@@ -497,20 +498,41 @@ receive th@THandle {params = THandleParams {thAuth}} Client {rcvQ, sndQ, rcvActi
               VRFailed -> Left (corrId, entId, ERR AUTH)
     write q = mapM_ (atomically . writeTBQueue q) . L.nonEmpty
 
-send :: Transport c => THandleSMP c 'TServer -> Client -> IO ()
-send h@THandle {params} Client {sndQ, sessionId, sndActiveAt} = do
+send :: Transport c => MVar (THandleSMP c 'TServer) -> Client -> IO ()
+send th c@Client {sndQ, msgQ, sessionId} = do
   labelMyThread . B.unpack $ "client $" <> encode sessionId <> " send"
-  forever $ do
-    ts <- atomically $ L.sortWith tOrder <$> readTBQueue sndQ
-    -- TODO we can authorize responses as well
-    void . liftIO . tPut h $ L.map (\t -> Right (Nothing, encodeTransmission params t)) ts
-    atomically . writeTVar sndActiveAt =<< liftIO getSystemTime
+  forever $ atomically (readTBQueue sndQ) >>= sendTransmissions
   where
-    tOrder :: Transmission BrokerMsg -> Int
-    tOrder (_, _, cmd) = case cmd of
-      MSG {} -> 0
-      NMSG {} -> 0
-      _ -> 1
+    sendTransmissions :: NonEmpty (Transmission BrokerMsg) -> IO ()
+    sendTransmissions ts
+      | L.length ts <= 2 = tSend th c ts
+      | otherwise = do
+          let (msgs_, ts') = mapAccumR splitMessages [] ts
+          -- If the request had batched subscriptions (L.length ts > 2)
+          -- this will reply OK to all SUBs in the first batched transmission,
+          -- to reduce client timeouts.
+          tSend th c ts'
+          -- After that all messages will be sent in separate transmissions,
+          -- without any client response timeouts, and allowing them to interleave
+          -- with other requests responses.
+          mapM_ (atomically . writeTBQueue msgQ) $ L.nonEmpty msgs_
+      where
+        splitMessages :: [Transmission BrokerMsg] -> Transmission BrokerMsg -> ([Transmission BrokerMsg], Transmission BrokerMsg)
+        splitMessages msgs t@(corrId, entId, cmd) = case cmd of
+          -- replace MSG response with OK, accumulating MSG in a separate list.
+          MSG {} -> ((CorrId "", entId, cmd) : msgs, (corrId, entId, OK))
+          _ -> (msgs, t)
+
+sendMsg :: Transport c => MVar (THandleSMP c 'TServer) -> Client -> IO ()
+sendMsg th c@Client {msgQ, sessionId} = do
+  labelMyThread . B.unpack $ "client $" <> encode sessionId <> " sendMsg"
+  forever $ atomically (readTBQueue msgQ) >>= mapM_ (\t -> tSend th c [t])
+
+tSend :: Transport c => MVar (THandleSMP c 'TServer) -> Client -> NonEmpty (Transmission BrokerMsg) -> IO ()
+tSend th Client {sndActiveAt} ts = do
+  withMVar th $ \h@THandle {params} ->
+    void . tPut h $ L.map (\t -> Right (Nothing, encodeTransmission params t)) ts
+  atomically . writeTVar sndActiveAt =<< liftIO getSystemTime
 
 disconnectTransport :: Transport c => THandle v c 'TServer -> TVar SystemTime -> TVar SystemTime -> ExpirationConfig -> IO Bool -> IO ()
 disconnectTransport THandle {connection, params = THandleParams {sessionId}} rcvActiveAt sndActiveAt expCfg noSubscriptions = do
@@ -1085,9 +1107,10 @@ saveServerMessages keepMsgs = asks (storeMsgsFile . config) >>= mapM_ saveMessag
             >>= mapM_ (B.hPutStrLn h . strEncode . MLRv3 rId)
 
 restoreServerMessages :: M Int
-restoreServerMessages = asks (storeMsgsFile . config) >>= \case
-  Just f -> ifM (doesFileExist f) (restoreMessages f) (pure 0)
-  Nothing -> pure 0
+restoreServerMessages =
+  asks (storeMsgsFile . config) >>= \case
+    Just f -> ifM (doesFileExist f) (restoreMessages f) (pure 0)
+    Nothing -> pure 0
   where
     restoreMessages f = do
       logInfo $ "restoring messages from file " <> T.pack f
diff --git a/src/Simplex/Messaging/Server/Env/STM.hs b/src/Simplex/Messaging/Server/Env/STM.hs
index c9f7e1cb1..845d483b1 100644
--- a/src/Simplex/Messaging/Server/Env/STM.hs
+++ b/src/Simplex/Messaging/Server/Env/STM.hs
@@ -138,6 +138,7 @@ data Client = Client
     ntfSubscriptions :: TMap NotifierId (),
     rcvQ :: TBQueue (NonEmpty (Maybe QueueRec, Transmission Cmd)),
     sndQ :: TBQueue (NonEmpty (Transmission BrokerMsg)),
+    msgQ :: TBQueue (NonEmpty (Transmission BrokerMsg)),
     endThreads :: TVar (IntMap (Weak ThreadId)),
     endThreadSeq :: TVar Int,
     thVersion :: VersionSMP,
@@ -172,13 +173,14 @@ newClient nextClientId qSize thVersion sessionId createdAt = do
   ntfSubscriptions <- TM.empty
   rcvQ <- newTBQueue qSize
   sndQ <- newTBQueue qSize
+  msgQ <- newTBQueue qSize
   endThreads <- newTVar IM.empty
   endThreadSeq <- newTVar 0
   connected <- newTVar True
   rcvActiveAt <- newTVar createdAt
   sndActiveAt <- newTVar createdAt
   proxyClient_ <- newTVar Nothing
-  return Client {clientId, subscriptions, ntfSubscriptions, rcvQ, sndQ, endThreads, endThreadSeq, thVersion, sessionId, connected, createdAt, rcvActiveAt, sndActiveAt, proxyClient_}
+  return Client {clientId, subscriptions, ntfSubscriptions, rcvQ, sndQ, msgQ, endThreads, endThreadSeq, thVersion, sessionId, connected, createdAt, rcvActiveAt, sndActiveAt, proxyClient_}
 
 newSubscription :: SubscriptionThread -> STM Sub
 newSubscription subThread = do
diff --git a/tests/AgentTests.hs b/tests/AgentTests.hs
index d42fffdd1..7873e1d74 100644
--- a/tests/AgentTests.hs
+++ b/tests/AgentTests.hs
@@ -27,9 +27,9 @@ import GHC.Stack (withFrozenCallStack)
 import Network.HTTP.Types (urlEncode)
 import SMPAgentClient
 import SMPClient (testKeyHash, testPort, testPort2, testStoreLogFile, withSmpServer, withSmpServerStoreLogOn)
-import Simplex.Messaging.Agent.Protocol hiding (MID, CONF, INFO, REQ, SENT)
+import Simplex.Messaging.Agent.Protocol hiding (CONF, INFO, MID, REQ, SENT)
 import qualified Simplex.Messaging.Agent.Protocol as A
-import Simplex.Messaging.Crypto.Ratchet (InitialKeys (..), PQEncryption (..), PQSupport (..), pattern IKPQOn, pattern IKPQOff, pattern PQEncOn, pattern PQSupportOn, pattern PQSupportOff)
+import Simplex.Messaging.Crypto.Ratchet (InitialKeys (..), PQEncryption (..), PQSupport (..), pattern IKPQOff, pattern IKPQOn, pattern PQEncOn, pattern PQSupportOff, pattern PQSupportOn)
 import qualified Simplex.Messaging.Crypto.Ratchet as CR
 import Simplex.Messaging.Encoding.String
 import Simplex.Messaging.Protocol (ErrorType (..))
@@ -547,10 +547,10 @@ testResumeDeliveryQuotaExceeded _ alice bob = do
   bob <#= \case ("", "alice", Msg "message 4") -> True; _ -> False
   bob #: ("4", "alice", "ACK 7") #> ("4", "alice", OK)
   inAnyOrder
-      (tGetAgent alice)
-      [ \case ("", c, Right (SENT 8)) -> c == "bob"; _ -> False,
-        \case ("", c, Right QCONT) -> c == "bob"; _ -> False
-      ]
+    (tGetAgent alice)
+    [ \case ("", c, Right (SENT 8)) -> c == "bob"; _ -> False,
+      \case ("", c, Right QCONT) -> c == "bob"; _ -> False
+    ]
   bob <#= \case ("", "alice", Msg "over quota") -> True; _ -> False
   -- message 8 is skipped because of alice agent sending "QCONT" message
   bob #: ("5", "alice", "ACK 9") #> ("5", "alice", OK)
@@ -580,7 +580,7 @@ enableKEMStr _ = ""
 
 pqConnModeStr :: InitialKeys -> ByteString
 pqConnModeStr (IKNoPQ PQSupportOff) = ""
-pqConnModeStr pq =  " " <> strEncode pq
+pqConnModeStr pq = " " <> strEncode pq
 
 sendMessage :: Transport c => (c, ConnId) -> (c, ConnId) -> ByteString -> IO ()
 sendMessage (h1, name1) (h2, name2) msg = do
diff --git a/tests/AgentTests/FunctionalAPITests.hs b/tests/AgentTests/FunctionalAPITests.hs
index 1561bf7a2..3476c24c9 100644
--- a/tests/AgentTests/FunctionalAPITests.hs
+++ b/tests/AgentTests/FunctionalAPITests.hs
@@ -59,10 +59,10 @@ import Data.ByteString.Char8 (ByteString)
 import qualified Data.ByteString.Char8 as B
 import Data.Either (isRight)
 import Data.Int (Int64)
-import Data.List (nub)
+import Data.List (find, nub)
 import Data.List.NonEmpty (NonEmpty)
 import qualified Data.Map as M
-import Data.Maybe (isNothing)
+import Data.Maybe (isJust, isNothing)
 import qualified Data.Set as S
 import Data.Time.Clock (diffUTCTime, getCurrentTime)
 import Data.Time.Clock.System (SystemTime (..), getSystemTime)
@@ -341,6 +341,9 @@ functionalAPITests t = do
     skip "faster version of the previous test (200 subscriptions gets very slow with test coverage)" $
       it "should subscribe to multiple (6) subscriptions with batching" $
         testBatchedSubscriptions 6 3 t
+    it "should subscribe to multiple connections with pending messages" $
+      withSmpServer t $
+        testBatchedPendingMessages 10 5
   describe "Async agent commands" $ do
     it "should connect using async agent commands" $
       withSmpServer t testAsyncCommands
@@ -1546,7 +1549,7 @@ testBatchedSubscriptions :: Int -> Int -> ATransport -> IO ()
 testBatchedSubscriptions nCreate nDel t =
   withAgentClientsCfgServers2 agentCfg agentCfg initAgentServers2 $ \a b -> do
     conns <- runServers $ do
-      conns <- replicateM (nCreate :: Int) $ makeConnection_ PQSupportOff a b
+      conns <- replicateM nCreate $ makeConnection_ PQSupportOff a b
       forM_ conns $ \(aId, bId) -> exchangeGreetings_ PQEncOff a bId b aId
       let (aIds', bIds') = unzip $ take nDel conns
       delete a bIds'
@@ -1605,6 +1608,25 @@ testBatchedSubscriptions nCreate nDel t =
         killThread t1
         pure res
 
+testBatchedPendingMessages :: Int -> Int -> IO ()
+testBatchedPendingMessages nCreate nMsgs =
+  withA $ \a -> do
+    conns <- withB $ \b -> runRight $ do
+      replicateM nCreate $ makeConnection a b
+    let msgConns = take nMsgs conns
+    runRight_ $ forM_ msgConns $ \(_, bId) -> sendMessage a bId SMP.noMsgFlags "hello"
+    replicateM_ nMsgs $ get a =##> \case ("", cId, SENT _) -> isJust $ find ((cId ==) . snd) msgConns; _ -> False
+    withB $ \b -> runRight_ $ do
+      r <- subscribeConnections b $ map fst conns
+      liftIO $ all isRight r `shouldBe` True
+      replicateM_ nMsgs $ do
+        ("", cId, Msg' msgId _ "hello") <- get b
+        liftIO $ isJust (find ((cId ==) . fst) msgConns) `shouldBe` True
+        ackMessage b cId msgId Nothing
+  where
+    withA = withAgent 1 agentCfg initAgentServers testDB
+    withB = withAgent 2 agentCfg initAgentServers testDB2
+
 testAsyncCommands :: IO ()
 testAsyncCommands =
   withAgentClients2 $ \alice bob -> runRight_ $ do