Subject: Re: [bitcoin-dev] Proposal: Extended serialization format for BIP-32 wallets

From: Thomas Voegtlin <[email-masked]>
Date: Thu, 7 Sep 2017 22:39:17 +0200

On 07.09.2017 18:23, Pavol Rusnak wrote:
> On 07/09/17 06:29, Thomas Voegtlin via bitcoin-dev wrote:
>> A solution is still needed to wallets who do not wish to use BIP43
> 
> What if we added another byte field OutputType for wallets that do not
> follow BIP43?
> 
> 0x00 - P2PKH output type
> 0x01 - P2WPKH-in-P2SH output type
> 0x02 - native Segwit output type
> 
> Would that work for you?
> 
> The question is whether this field should be present only if depth==0x00
> or at all times. What is your suggestion, Thomas?
> 

well, in my initial proposal, I wrote that this value should be user
visible. That is why I used version bytes. If you create an extra byte
field, and then use base58 or bech32 encoding, the value will not be
user visible anymore.

The initial implementation of segwit xpub/xprv in Electrum used a flag
that was not user visible (I added 1 to the bip32 version bytes, which
leaves the xpub/xprv prefix unchanged). I have experimented with that
invisible flag for more than 6 months now, and I am now convinced that
it is better to make that flag user visible.

The reason is that when users create wallets with multisig scripts, they
need to combine several master public keys. However, these master public
keys should all be of the same type: it would not make sense to create a
2 of 3 multisig wallet with a one xpub, one ypub and one zpub. By
imposing that all master keys are of the same type, we ensure that all
cosigners agree on the script type that will be used to derive addresses.

In other words, if users are exposed to master keys and need to
manipulate them, it is better to let them see what they are doing.

OTOH if you do not plan to expose your users to these keys, you probably
do not need a serialization format.