Subject: Re: [bitcoindev] BIP 322 use case

From: Prof EduStream <[email-masked]>
Date: Fri, 10 May 2024 10:47:10 -0700 (PDT)

Hey,

@Luke: You said a few days ago that signing a message with a multi-sig 
address doesn't have lots of use cases. That's true. But I would argue that 
the use cases are the same as signing a message with a single-sig address: 
being able to cryptographically show that you own an address, which is 
possible in Bitcoin.
I also don't understand why a multi-sig user — who uses a multi-sig wallet 
to secure their bitcoins — couldn't be able to do the same things as a 
single-sig user.

Not wanting to create tools or features that could be used as compliance 
tools is an answer, and as a privacy advocate I do understand this point of 
view. However, single-sig signing already exists, and multi-sig signing 
would only extend this feature to a few people for their personal use; plus 
some companies, which are already compliant.

*> "That being said, BIP322 as-is has already been adopted by at least some 
wallets, despite its unfinished state"*

 @Luke & @Ali: I have tried numerous wallets in the past few weeks, but 
none of them seemed to have adopted BIP322. If you have any further 
information (or GitHub implementation / repo), please feel free to send it 
to me. 

Thank you both for your answers,
@ProfEduStream
Le dimanche 5 mai 2024 à 16:54:28 UTC+2, Luke Dashjr a écrit :

> Addresses are not tied to UTXOs. A proof-of-funds would only ever be 
> proving a numeric amount, not an address. While the proof would necessarily 
> use UTXOs behind-the-scenes, the signature would not be committing to those 
> specific UTXOs being the property of the message-signer; this property is 
> necessary for plausible deniability as well as hot/cold wallet separation 
> (multiple users could have signed messages using the same UTXOs, yet 
> reflecting distinct bitcoin claims).
>
> Proof-of-sender, on the other hand, would make a claim to have sent a 
> specific txid and output index. Where this gets fairly complicated is that 
> it's somewhat important to have a mechanism that is compatible with 
> coinjoins, and without requiring the coinjoin participants to keep in 
> contact after the transaction is formed. It should able be compatible with 
> signing for transactions sent without preparation to sign messages later. 
> Ultimately, this requires delegation.
>
> And since it wouldn't be great to be able to distinguish between delegated 
> and non-delegated, probably everything should just always be delegated 
> (perhaps to a deterministic keypair in some scenarios).
>
> There's also potentially a use case for accepting an opcode rejects on 
> mainnet as invalid, so tapscripts can commit to sign-only script paths.
>
> One thing all the current message signing standards lack is some kind of 
> magic heading to identify what they are, like bech32's "bc1" prefix. This 
> would be a trivial addition rather than trying to decode signatures N 
> different ways and seeing which verify.
>
> I do agree being able to, at least internally, convert to/from PSBTs would 
> improve compatibility significantly. This was the approach I aimed for when 
> I tried to tackle it a few months ago. One limitation with PSBTs is that 
> each input needs non-witness and/or witness input data - repeatedly, if 
> multiple of the same transaction's outputs are used as inputs. To address 
> that, I was planning to support having them refer back to previous inputs' 
> data.
>
> Hope all this helps, if someone wants to pick up the task...
>
> Luke
> On 5/5/24 08:09, Ali Sherief wrote:
>
> > But the feature with much higher demand is proof-of-funds and 
> proof-of-sender, which BIP322 began to address, but turns out to be much 
> more complicated than it seems at face value (I recently looked into this 
> again as part of relaunching OCEAN).
>
> BIP322 is trying to figure two things: Collecting an authentic UTXO set 
> for a given list of addresses, and actually making the signed message. It 
> appears that only the latter of the two has been solved.
>
> I think one of the things that would help unstuck this is an RPC for 
> getting the UTXO set of a list of addresses. I am aware that this is 
> already possible with some SPV implementations, but to have the 
> functionality directly in Core would make this BIP more viable.
>
> > That being said, BIP322 as-is has already been adopted by at least some 
> wallets, despite its unfinished state. So if someone were to pick up this 
> task, it would probably need to be done as a new BIP 
>
> Probably the best solution would be to make a split, where the BIP322 
> draft as it currently is can be used unofficially and then programmed into 
> software that needs it, and then you can have the actual 
> authentication/contract mechanism constructed in a new BIP. Actually, we 
> already have some of the framework for this in Core, since PSBTs can be 
> used to distribute and sign "message contracts". All that's needed is an 
> RPC to get the UTXO set and another to create an unsigned template 
> transaction for the message.
>
> -Ali
>
> On Saturday, May 4, 2024 at 12:14:53 AM UTC Luke Dashjr wrote:
>
> KYC is not an intended use case for signed messages, and attempts to use 
> it for that are probably one of the bigger reasons BIP322 has not moved 
> further - most people do not want to encourage nor enable such nonsense. If 
> you absolutely must only allow withdrawls to the user's own address, I 
> would suggest taking a more traditional approach of asking the user to 
> affirm it with a checkbox. (This is not legal advice, but it seems crazy to 
> demand cryptographic proof from Bitcoin companies, when traditional finance 
> is okay with a mere attestation)
>
> Technically speaking, however, the biggest hurdle is that there is very 
> little apparent interest in the one limited use case it *is* meant for: 
> agreeing to a contract before funds are sent. To a limited extent, a 
> secondary use case has been simply using Bitcoin addresses as a kind of 
> login mechanism (eg, #Bitcoin-OTC and OCEAN). But the feature with much 
> higher demand is proof-of-funds and proof-of-sender, which BIP322 began to 
> address, but turns out to be much more complicated than it seems at face 
> value (I recently looked into this again as part of relaunching OCEAN). 
> That being said, BIP322 as-is has already been adopted by at least some 
> wallets, despite its unfinished state. So if someone were to pick up this 
> task, it would probably need to be done as a new BIP. :/
>
> Luke
>
>
> On 5/3/24 19:53, ProfEduStream wrote:
>
> Hey,
>
> As a Bitcoin association, we're currently facing an issue because we're 
> unable to sign an address with our multi-sig wallet.
> After conducting some research, I came across BIP322 in these threads: 
> https://bitcointalk.org/index.php?topic=5408898.0 & 
> https://github.com/bitcoin/bips/pull/1347
>
> *Explanation*:
>
> As a Bitcoin association, we offer membership to everyone for a few 
> thousand sats per year. To facilitate this process, we utilize "Swiss 
> Bitcoin Pay". It's an application that allows us to easily manage our 
> accounting. Additionally, we onboard merchants with this app because of its 
> user-friendly interface and self-custodial capabilities, making it very 
> convenient. The accounting features are also highly beneficial.
>
> To utilize this application in a self-custodial manner, users need to 
> paste a Bitcoin address on the "Swiss Bitcoin Pay" dashboard and then sign 
> a message with this address. This serves as a "Proof-of-Ownership" and is a 
> legal requirement in some regulated countries. "Swiss Bitcoin Pay" is not 
> the only application that requires signing a message as a 
> "Proof-of-Ownership". Peach, a non-KYC P2P Bitcoin application, is another 
> example.
>
> Given our goal to decentralize our treasury, we naturally opt for a 
> multi-sig wallet, similar to many companies. However, as you know, BIP 322 
> hasn't been pushed and it's currently impossible to sign a message with a 
> multi-sig wallet.
>
>
> *Conclusion*:
>
> I'm unsure why BIP322 hasn't been pushed or addressed in the past few 
> months/years, but I want to highlight its necessity.
> Additionally, I hope that this comment sheds light on a deficiency in our 
> Bitcoin ecosystem, and I trust that further improvements will be made to 
> enable people to sign a message with a multi-sig wallet.
>
>
> I'm available to assist if needed.
>
> @ProfEduStream
>
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