Subject: Re: [Bitcoin-development] BIP for Proof of Payment

From: Kalle Rosenbaum <[email-masked]>
Date: Mon, 15 Jun 2015 11:21:06 +0200

Hi all!

I have made the discussed changes and updated my implementation (
https://github.com/kallerosenbaum/poppoc) accordingly. These are the
changes:

* There is now only one output, the "pop output", of value 0.
* The sequence number of all inputs of the PoP must be set to 0. I
chose to set it to 0 for all inputs for simplicity.
* The lock_time of the PoP must be set to 499999999 (max block height lock
time).

The comments so far has been mainly positive or neutral. Are there any
major objections against any of the two proposals? If not, I will ask
Gregory Maxwell to assign them BIP numbers.

The two BIP proposals can be found at
https://github.com/kallerosenbaum/poppoc/wiki/Proof-of-Payment-BIP and
https://github.com/kallerosenbaum/poppoc/wiki/btcpop-scheme-BIP. The source
for the Proof of Payment BIP proposal is also in-lined below.

A number of alternative names have been proposed:

* Proof of Potential
* Proof of Control
* Proof of Signature
* Signatory Proof
* Popo: Proof of payment origin
* Pots: Proof of transaction signer
* proof of transaction intent
* Declaration of intent
* Asset-access-and-action-affirmation, AAaAA, or A5
* VeriBit
* CertiBTC
* VBit
* PayID

Given this list, I still think "Proof of Payment" is the most descriptive
to non-technical people.

Regards,
Kalle

#################################################
<pre>
  BIP: <BIP number>
  Title: Proof of Payment
  Author: Kalle Rosenbaum <[email-masked]>
  Status: Draft
  Type: Standards Track
  Created: <date created on, in ISO 8601 (yyyy-mm-dd) format>
</pre>

== Abstract ==

This BIP describes how a wallet can prove to a server that it has the
ability to sign a certain transaction.

== Motivation ==

There are several scenarios in which it would be useful to prove that you
have paid for something. For example:

* A pre-paid hotel room where your PoP functions as a key to the door.
* An online video rental service where you pay for a video and watch it on
any device.
* An ad-sign where you pay in advance for e.g. 2 weeks exclusivity. During
this period you can upload new content to the sign whenever you like using
PoP.
* Log in to a pay site using a PoP.
* A parking lot you pay for monthly and the car authenticates itself using
PoP.
* A lottery where all participants pay to the same address, and the winner
is selected among the transactions to that address. You exchange the prize
for a PoP for the winning transaction.

With Proof of Payment, these use cases can be achieved without any personal
information (user name, password, e-mail address, etc) being involved.

== Rationale ==

Desirable properties:

# A PoP should be generated on demand.
# It should only be usable once to avoid issues due to theft.
# It should be able to create a PoP for any payment, regardless of script
type (P2SH, P2PKH, etc.).
# It should prove that you have enough credentials to unlock all the inputs
of the proven transaction.
# It should be easy to implement by wallets and servers to ease adoption.

Current methods of proving a payment:

* In BIP0070, the PaymentRequest together with the transactions fulfilling
the request makes some sort of proof. However, it does not meet 1, 2 or 4
and it obviously only meets 3 if the payment is made through BIP0070. Also,
there's no standard way to request/provide the proof. If standardized it
would probably meet 5.
* Signing messages, chosen by the server, with the private keys used to
sign the transaction. This could meet 1 and 2 but probably not 3. This is
not standardized either. 4 Could be met if designed so.

If an input script type is P2SH, any satisfying script should do, just as
if it was a payment. For M-of-N multisig scripts, that would mean that any
set of M keys should be sufficient, not neccesarily the same set of M keys
that signed the transaction. This is important because strictly demanding
the same set of M keys would defeat the purpose of a multisig address.

== Specification ==

=== Data structure ===

A proof of payment for a transaction T, here called PoP(T), is used to
prove that one has ownership of the credentials needed to unlock all the
inputs of T. It has the exact same structure as a bitcoin transaction with
the same inputs as T and in the same order as in T, but with each sequence
number set to 0. There is exactly one output, here called the pop output,
with value 0. The pop output must have the following format:

 OP_RETURN <version> <txid> <nonce>

{|
! Field        !! Size [B] !! Description
|-
| &lt;version> || 2        || Version, little endian, currently 0x01 0x00
|-
| &lt;txid>    || 32       || The transaction to prove
|-
| &lt;nonce>   || 6        || Random data
|}

The lock_time of the PoP must be set to 499999999 to prevent the PoP from
being included in a block, should it appear on the bitcoin p2p network.
This is also the reason for setting the sequence numbers to 0, since
sequence number of ffffffff would make lock_time ineffective. This
specification demands that all input sequence numbers are 0, not just one
of them, which would be sufficient to make lock_time effective. This is for
simplicity reasons.

An illustration of the PoP data structure and its original payment is shown
below.

<pre>
  T
 +------------------------------------------------+
 |inputs                | outputs                 |
 |       Value,Sequence | Value,Script            |
 +------------------------------------------------+
 |input0 1,ffffffff     | 0,pay to A              |
 |input1 3,ffffffff     | 2,OP_RETURN <some data> |
 |input2 4,ffffffff     | 1,pay to B              |
 |                      | 4,pay to C              |
 +------------------------------------------------+

  PoP(T)
 +-------------------------------------------------------------+
 | inputs               | outputs                              |
 |       Value,Sequence | Value,Script                         |
 +-------------------------------------------------------------+
 |input0 1,00000000     | 0,OP_RETURN <version> <txid> <nonce> |
 |input1 3,00000000     |                                      |
 |input2 4,00000000     |                                      |
 +-------------------------------------------------------------+
 | lock_time=499999999                                         |
 +-------------------------------------------------------------+
</pre>

The PoP is signed using the same signing process that is used for bitcoin
transactions.

The purpose of the nonce is to make it harder to use a stolen PoP; Once the
PoP has reached the server, that PoP is useless since the server will
generate a new nonce for every PoP request.

=== Process ===

# A proof of payment request is sent from the server to the wallet. The PoP
request contains:
## a random nonce
## a destination where to send the PoP, for example a https URL
## data hinting the wallet which transaction to create a proof for. For
example:
##* txid, if known by the server
##* PaymentRequest.PaymentDetails.merchant_data (in case of a BIP0070
payment)
##* amount, label, message or other information from a BIP0021 URI
# The wallet identifies a transaction T, if possible. Otherwise it asks the
user to select among the ones that match the hints in 1.iii.
# The wallet creates an unsigned PoP (UPoP) for T, and asks the user to
sign it.
# The user confirms
# The UPoP(T) is signed by the wallet, creating PoP(T).
# The PoP is sent to the destination in 1.ii.
# The server receiving the PoP validates it and responds with “valid” or
“invalid”.
# The wallet displays the response in some way to the user.

'''Remarks:'''

* The method of transferring the PoP request at step 1 is not specified
here. Instead that is specified in separate specifications. See [btcpop
scheme BIP](btcpop scheme BIP).
* The nonce must be randomly generated by the server for every new PoP
request.

=== Validating a PoP ===

The server needs to validate the PoP and reply with "valid" or "invalid".
That process is outlined below. If any step fails, the validation is
aborted and "invalid" is returned:

# Check the format of the PoP. It must pass normal transaction checks,
except that the inputs may already be spent.
# Check that lock_time is 499999999.
# Check that there is exactly one output. This output must have value 0 and
conform to the OP_RETURN output format outlined above.
# Check that the nonce is the same as the one requested.
# Check that the inputs of the PoP are exactly the same as in transaction
T, except that the sequence numbers must all be 0. The ordering of the
inputs must also be the same as in T.
# Run the scripts of all the inputs. All scipts must return true.
# Check that the txid in the PoP output is the transaction you actually
want proof for. If you don’t know exactly what transaction you want proof
for, check that the transaction actually pays for the product/service you
deliver.
# Return "valid".

== Security considerations ==

* Someone can intercept the PoP-request and change any parameter in it.
These can be mitigated by using secure connections. For example:
** Pop destination - Stealing your PoP.
** label - Trick you to sign an unintended pop or set a label that your
wallet doesn't have any record for, resulting in a broken service. Always
check the PoP before signing.
** nonce - Your pop will not validate on server.
* Someone can steal a PoP, for example by tampering with the PoP request,
and try to use the service hoping to get a matching nonce. Probability per
try: 1/(2^48). The server should have a mechanism for detecting a brute
force attack of this kind, or at least slow down the process by delaying
the PoP request by some 100 ms or so.
* Even if a wallet has no funds it might still be valuable as a generator
for PoPs. This makes it important to keep the security of the wallet after
it has been emptied.
* Transaction malleability may cause the server to have another transaction
id for a payment than the client's wallet. In that case the wallet will not
be able to prove the transaction to the server. Wallets should not rely on
the transaction id of the outgoing transaction. Instead it should listen
for the transaction on the network and put that in its list of transactions.

== Reference implementation ==

[https://github.com/kallerosenbaum/poppoc poppoc on GitHub]

[https://github.com/kallerosenbaum/wallet Mycelium fork on GitHub]

== References ==

[https://github.com/bitcoin/bips/blob/master/bip-0021.mediawiki BIP0021]:
URI Scheme

[https://github.com/bitcoin/bips/blob/master/bip-0070.mediawiki BIP0070]:
Payment Protocol

[[btcpop scheme BIP]]

#########################################################

2015-06-06 23:25 GMT+02:00 Kalle Rosenbaum <[email-masked]>:
> Thank you all for the feedback.
>
> I will change the data structure as follows:
>
> * There will be only one output, the "pop output", and no outputs from
> T will be copied to the PoP.
> * The pop output will have value 0.
> * The sequence number of all inputs of the PoP will be set to 0. I
> chose to set it to 0 for all inputs for simplicity.
> * The lock_time of the PoP is always set to 499999999.
>
> Any comments on this?
>
> /Kalle
>
> 2015-06-06 19:00 GMT+02:00 Kalle Rosenbaum <[email-masked]>:
>> 2015-06-06 18:10 GMT+02:00 Tom Harding <[email-masked]>:
>>> On Jun 6, 2015 8:05 AM, "Kalle Rosenbaum" <[email-masked]> wrote:
>>>
>>>> I'm open to changes here.
>>>
>>> I suggest:
>>>
>>> - Don't include any real outputs.   They are redundant because the txid
is
>>> already referenced.
>>
>> with the nLocktime solution, the copied outputs are not needed.
>>
>>>
>>> - Start the proof script, which should be invalid, with a magic
constant and
>>> include space for future expansion.  This makes PoP's easy to identify
and
>>> extend.
>>
>> I did remore the constant (a "PoP" literal ascii encoded string)
>> because it didn't add much. The recipient will expect a pop, so it
>> will simply treat it as one. I did add a 2 byte version field to make
>> it extendable.
>>
>>>
>>> - "Proof of Potential"
>>
>> Noted :-)
>>
>> Thank you
>> /Kalle