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Subject: Re: [bitcoin-dev] Wallet policies for descriptor wallets
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I took a look at the spec for the wallet descriptor format, and I like the
concept of having placeholder variables for keys. It reduces the size of
the descriptor, makes it substantially easier for a human to
read/verify, especially in the future when we have more complex
scripts, and provides a nice format for a script template which can make it
easier to verify that you're using the same script template as something
else (ie besides using different keys). I think the `/**` syntax is an
improvement over the current descriptor format, however it is a bit awkward
and inflexible. My understanding is that some of this inflexibility comes
from the goal of reducing memory usage, and I don't think I have a good
enough handle on that part of things to usefully comment. I've put
additional comments and suggestions on the format in this github issue
<https://github.com/LedgerHQ/app-bitcoin-new/issues/35>.

I think it would be very useful to come to agreement on a more flexible
format that can support a much broader set of use cases, and can
potentially be a widely supported standard. I understand low-ram devices
might have a much harder time using more flexible (and complex) formats.







On Thu, May 5, 2022 at 9:39 AM Salvatore Ingala via bitcoin-dev <
bitcoin-dev@lists.linuxfoundation.org> wrote:

> In the implementation work to implement descriptors and miniscript support
> in hardware wallets [a][b], I encountered a number of challenges. Some of
> them are technical in nature (e.g. due to constraints of embedded
> development). Others are related to the attempts of shaping a good user
> experience; with bitcoin reaching more people who are not tech-savvy,
> self-custody is only as secure as what those newcomers can use easily
> enough.
>
> The main tool that I am using to address some of these challenges is a
> layer that sits _on top_ of descriptors/miniscript, while staying very
> close to it. Since there is nothing that is vendor-specific in the vast
> majority of the approach I'm currently using, I tried to distill it here
> for your comments, and will propose a BIP if this is deemed valuable.
>
> I called the language "wallet policies" (suggestions for a better name are
> welcome). I believe an approach based on wallet policies can benefit all
> hardware wallets (stateless or not) that want to securely support complex
> scripts; moreover, wallet policies are close enough to descriptors that
> their integration should be extremely easy for any software wallet that is
> currently using descriptors.
>
> [a]: https://blog.ledger.com/bitcoin-2 - early demo
> [b]: https://blog.ledger.com/miniscript-is-coming - miniscript example
>
>
> Salvatore Ingala
>
>
> ======================================================
>
> This document starts with a discussion on the motivation for wallet
> policies, followed by their formal definition, and some recommendations for
> implementations.
>
> == Rationale ==
>
> Output script descriptors [1] were introduced in bitcoin-core as a way to
> represent collections of output scripts. It is a very general and flexible
> language, designed to catch all the possible use-cases of bitcoin wallets
> (that is, if you know the script and you have the necessary keys, it will
> be possible to sign transactions with bitcoin-core's descriptor-based
> wallets).
>
> Unfortunately, descriptors are not a perfect match for the typical usage
> of hardware wallets. Most hardware wallets have the following limitations
> compared to a general-purpose machine running bitcoin-core:
>
> - they are embedded devices with limited RAM and computational power;
> - they might not be able to import additional private keys (all the keys
> are generated from a single seed via [BIP-32](
> https://github.com/bitcoin/bips/blob/master/bip-0032.mediawiki));
> - they might not have permanent storage (*stateless* hardware wallet
> design).
>
> Moreover, other limitations like the limited size of the screen might
> affect what design choices are available in practice. Therefore, minimizing
> the size of the information shown on-screen is important for a good user
> experience.
>
> A more native, compact representation of the wallet receive/change would
> also benefit the UX of software wallets using descriptors to represent
> software wallets using descriptors/miniscript for multisignature or other
> complex locking conditions.
>
> === Security and UX concerns of scripts in hardware wallets ===
>
> For a hardware wallet, allowing the usage of complex scripts presents
> challenges in terms of both security and user experience.
>
> ==== Security issues ====
>
> One of the security properties that hardware wallets strive to guarantee
> is the following: **as long as the user correctly verifies the information
> that is shown on the hardware wallet's screen before approving, no action
> can be performed without the user's consent**.
> This must hold even in scenarios where the attacker has full control of
> the machine that is connected to the hardware wallet, and can execute
> arbitrary requests or tamper with the legitimate user's requests.
>
> Therefore, it is not at all trivial to allow complex scripts, especially
> if they contain keys that belong to third parties.
> The hardware wallet must guarantee that the user knows precisely *what*
> "policy" is being used to spend the funds, and that the "unspent" funds (if
> any) will be protected by the same policy. This makes it impossible for an
> attacker to surreptitiously modify the policy, therefore stealing or
> burning user's funds.
>
> ==== UX issues ====
>
> With miniscript (and taproot trees) allowing substantially more complex
> spending policies to be used, it becomes more challenging to make sure that
> the user is able _in practice_ to verify the information on the screen.
> Therefore, there are two fundamental design goals to strive for:
> - Minimize the amount of information that is shown on screen - so that the
> user can actually validate it.
> - Minimize the number of times the user has to validate such information.
>
> Designing a secure protocol for the coordination of a descriptor wallet
> among distant parties is also a challenging problem that is out of scope in
> this document. See BIP-129 [2] for an approach designed for multisignature
> wallets.
>
> === Policy registration as a solution ===
>
> A solution to address the security concerns, and part of the UX concerns,
> is to have a *registration* flow for the wallet policy in the hardware
> wallet. The "wallet policy" must contain enough information to generate all
> the relevant addresses/scripts, and for the hardware wallet to identify the
> keys that it controls and that are needed to spend the funds sent to those
> addresses.
>
> Before a new policy is used for the first time, the user will register a
> `wallet policy` into the hardware wallet. While the details of the process
> are out of scope in this document, the flow should be something similar to
> the following:
>
> 1) The software wallet initiates a _wallet policy registration_ on the
> hardware wallet; the information should include the wallet policy, but also
> a unique *name* that identifies the policy.
> 2) The hardware wallet shows the wallet policy to the user using the
> secure screen.
> 3) After inspecting the policy and comparing it with a trusted source (for
> example a printed backup), the user approves the policy.
> 4) If stateful, the hardware wallet persists the policy in its permanent
> memory; if stateless, it returns a "proof of registration".
>
> The details of how to create a proof of registration are out of scope for
> this document; using a *message authentication codes* on a hash committing
> to the wallet policy, its name and any additional metadata is an effective
> solution if correctly executed.
>
> Once a policy is registered, the hardware wallet can perform the usual
> operations securely:
> - generating receive and change addresses;
> - showing addresses on the secure screen;
> - sign transactions spending from a wallet, while correctly identifying
> change addresses and computing the transaction fees.
>
> Before any of the actions mentioned above, the hardware wallet will
> retrieve the policy from its permanent storage if stateful; if stateless it
> will validate the _proof of registration_ before using the wallet policy
> provided by the client.
> Once the previously registered policy is correctly identified and approved
> by the user (for example by its name), and *as long as the policy
> registration was executed securely*, hardware wallets can provide a user
> experience similar to the usual one for single-signature transactions.
>
> === Avoiding blowup in descriptor size ===
>
> While reusing a pubkey in different branches of a miniscript is explicitly
> forbidden by miniscript (as it has certain negative security implications),
> it is still reasonable to reuse the same *xpub* in multiple places, albeit
> with different final steps of derivation (so that the actual pubkeys that
> are used in the script are indeed different).
>
> For example, using Taproot, a *3*-of-*5* multisignature wallet could use:
> - a key path with a 5-of-5 MuSig
> - a script tree with a tree of 10 different 3-of-3 MuSig2 scripts, that
> are generated, plus a leaf with a fallback *3*-of-*5* multisignature using
> plain multisignature (with `OP_CHECKSIGADD`).
>
> This could look similar to:
>
> ```
> tr(musig2(xpubA,xpubB,xpubC,xpubD,xpubE)/<0;1>/*), {
>   {
>     {
>       pk(musig2(xpubA,xpubB,xpubC)/<2;3>/*),
>       {
>         pk(musig2(xpubA,xpubB,xpubD)/<4;5>/*)
>         pk(musig2(xpubA,xpubB,xpubE)/<6;7>/*),
>       }
>     },
>     {
>       pk(musig2(xpubA,xpubC,xpubD)/<8;9>/*),
>       {
>         pk(musig2(xpubA,xpubC,xpubE)/<10;11>/*),
>         pk(musig2(xpubA,xpubD,xpubE)/<12;13>/*)
>       }
>     }
>   },
>   {
>     {
>       pk(musig2(xpubB,xpubC,xpubD)/<14;15>/*),
>       pk(musig2(xpubB,xpubC,xpubE)/<16;17>/*)
>     },
>     {
>       pk(musig2(xpubB,xpubD,xpubE)/<18;19>/*),
>       {
>         pk(musig2(xpubC,xpubD,xpubE)/<20;21>/*),
>         sortedmulti_a(3,
>           xpubA/<22;23>/*,
>           xpubB/<22;23>/*,
>           xpubC/<22;23>/*,
>           xpubD/<22;23>/*,
>           xpubE/<22;23>/*)
>       }
>     }
>   }
> })
> ```
>
> Note that each root xpub appears 8 times. With xpubs being up to 118 bytes
> long, the length of the full descriptor can get extremely long (the problem
> gets *exponentially* worse with larger multisignature schemes).
>
> Replacing the common part of the key with a short key placeholder and
> moving the key expression separately helps to keep the size of the wallet
> policy small, which is crucial to allow human inspection in the
> registration flow.
>
> === Restrictions on the supported descriptors ====
>
> The policy language proposed in this document purposely targets only a
> stricter subset of the output descriptors language, and it attempts to
> generalize in the most natural way the approach that is already used for
> single-signature *accounts* (as described in BIP-44 [3], BIP-49 [4], BIP-84
> [5], or BIP-86 [6]), or in multisignature setups (see for example BIP-48
> [7] and BIP-87 [8]).
>
> Unlike the BIPs mentioned above, it is not tied to any specific script
> template, as it applies to arbitrary scripts that can be represented with
> descriptors and miniscript.
>
> Supporting only a reduced feature set when compared to output descriptors
> helps in implementations (especially on hardware wallets), while attempting
> to capture all the common use cases. More features can be added in the
> future if motivated by real world necessity.
>
> By keeping the structure of the wallet policy language very close to that
> of descriptors, it should be straightforward to:
> - write wallet policy parsers;
> - extract the descriptors defined by a wallet policy;
> - convert a pair of descriptors describing a wallet "account" used in
> current implementations into the corresponding wallet policy.
>
>
> == Wallet policies ==
>
> This section formally defines wallet policies, and how they relate to
> output script descriptors.
>
> === Formal definition ===
>
> A wallet policy is composed by a wallet descriptor template, together with
> a vector of key information items.
>
> ==== Wallet descriptor template ====
>
> A wallet descriptor template is a `SCRIPT` expression.
>
> `SCRIPT` expressions:
> - `sh(SCRIPT)` (top level only): P2SH embed the argument.
> - `wsh(SCRIPT)` (top level or inside `sh` only): P2WSH embed the argument.
> - `pkh(KP)` (not inside `tr`): P2PKH output for the given public key (use
> `addr` if you only know the pubkey hash).
> - `wpkh(KP)` (top level or inside `sh` only): P2WPKH output for the given
> compressed pubkey.
> - `multi(k,KP_1,KP_2,...,KP_n)`: k-of-n multisig script.
> - `sortedmulti(k,KP_1,KP_2,...,KP_n)`: k-of-n multisig script with keys
> sorted lexicographically in the resulting script.
> - `tr(KP)` or `tr(KP,TREE)` (top level only): P2TR output with the
> specified key as internal key, and optionally a tree of script paths.
> - any valid miniscript template (inside `wsh` or `tr` only).
>
> `TREE` expressions:
> - any `SCRIPT` expression
> - An open brace `{`, a `TREE` expression, a comma `,`, a `TREE`
> expression, and a closing brace `}`
>
> Note: "miniscript templates" are not formally defined in this version of
> the document, but it is straightforward to adapt this approach.
>
> `KP` expressions (key placeholders) consist of
> - a single character `@`
> - followed by a non-negative decimal number, with no leading zeros (except
> for `@0`).
> - possibly followed by either:
>   - the string  `/**`, or
>   - a string of the form `/<NUM;NUM>/*`, for two distinct decimal numbers
> `NUM` representing unhardened derivations
>
> The `/**` in the placeholder template represents commonly used paths for
> receive/change addresses, and is equivalent to `<0;1>`.
>
> The placeholder `@i` for some number *i* represents the *i*-th key in the
> vector of key origin information (which must be of size at least *i* + 1,
> or the wallet policy is invalid).
>
> ==== Key informations vector ====
>
> Each element of the key origin information vector is a `KEY` expression.
>
> - Optionally, key origin information, consisting of:
>   - An open bracket `[`
>   - Exactly 8 hex characters for the fingerprint of the master key from
> which this key is derived from (see [BIP32](
> https://github.com/bitcoin/bips/blob/master/bip-0032.mediawiki) for
> details)
>   - Followed by zero or more `/NUM'` path elements to indicate hardened
> derivation steps between the fingerprint and the xpub that follows
>   - A closing bracket `]`
> - Followed by the actual key, which is either
>   - a hex-encoded pubkey, which is either
>     - inside `wpkh` and `wsh`, only compressed public keys are permitted
> (exactly 66 hex characters starting with `02` or `03`.
>     - inside `tr`, x-only pubkeys are also permitted (exactly 64 hex
> characters).
>   - a serialized extended public key (`xpub`) (as defined in [BIP 32](
> https://github.com/bitcoin/bips/blob/master/bip-0032.mediawiki))
>
> The placeholder `@i` for some number *i* represents the *i*-th key in the
> vector of key orIgin information (which must be of size at least *i* + 1,
> or the wallet policy is invalid).
>
> The policy template is invalid if any placeholder `@i` has derivation
> steps while the corresponding `(i+1)`-th element of the keys vector is not
> an xpub.
>
> ==== Additional rules ====
>
> The wallet policy is invalid if any placeholder expression with additional
> derivation steps is used when the corresponding key information is not an
> xpub.
>
> The key information vector *should* be ordered so that placeholder `@i`
> never appear for the first time before an occurrence of `@j`  for some `j <
> i`; for example, the first placeholder is always `@0`, the next one is
> `@1`, etc.
>
> === Descriptor derivation ===
>
> From a wallet descriptor template (and the associated vector of key
> informations), one can therefore obtain the 1-dimensional descriptor for
> receive and change addresses by:
>
> - replacing each key placeholder with the corresponding key origin
> information;
> - replacing every `/**`  with `/0/*` for the receive descriptor, and
> `/1/*` for the change descriptor;
> - replacing every `/<M,N>` with  `/M` for the receive descriptor, and `/N`
> for the change descriptor.
>
> For example, the wallet descriptor `pkh(@0/**)` with key information
> `["[d34db33f/44'/0'/0']xpub6ERApfZwUNrhLCkDtcHTcxd75RbzS1ed54G1LkBUHQVHQKqhMkhgbmJbZRkrgZw4koxb5JaHWkY4ALHY2grBGRjaDMzQLcgJvLJuZZvRcEL"]`
> produces the following two descriptors:
>
> - Receive descriptor:
> `pkh([d34db33f/44'/0'/0']xpub6ERApfZwUNrhLCkDtcHTcxd75RbzS1ed54G1LkBUHQVHQKqhMkhgbmJbZRkrgZw4koxb5JaHWkY4ALHY2grBGRjaDMzQLcgJvLJuZZvRcEL/0/*)`
>
> - Change descriptor:
> `pkh([d34db33f/44'/0'/0']xpub6ERApfZwUNrhLCkDtcHTcxd75RbzS1ed54G1LkBUHQVHQKqhMkhgbmJbZRkrgZw4koxb5JaHWkY4ALHY2grBGRjaDMzQLcgJvLJuZZvRcEL/1/*)`
>
> === Implementation guidelines ===
>
> Implementations must not necessarily implement all of the possible wallet
> policies defined by this standard, but it is recommended to clearly
> document any limitation.
>
> Implementations can add additional metadata that is stored together with
> the wallet policy for the purpose of wallet policy registration and later
> usage. Metadata can be vendor-specific and is out of the scope of this
> document.
>
> Any implementation in a general-purpose software wallet allowing arbitrary
> scripts (or any scripts that involve external cosigners) should put great
> care into a process for backing up a wallet policy. In fact, unlike typical
> single-signature scenarios, the seed alone is no longer enough to discover
> wallet policies with existing funds, and the loss of the backup is likely
> to lead to permanent loss of funds.
>
> Avoiding key reuse among different wallet accounts is also extremely
> important, but out of scope for this document.
>
> == Examples ==
>
> Some examples of wallet descriptor templates (vectors of keys omitted for
> simplicity):
> - Template for a native segwit account:
>   wpkh(@0/**)
> - Template for a taproot BIP86 account:
>   tr(@0/**)
> - Template for a native segwit 2-of-3:
>   wsh(sortedmulti(2,@0/**,@1/**,@2/**))
> - Template with miniscript for "1 of 2 equally likely keys":
>   wsh(or_b(pk(@0/**),s:pk(@1/**)))
>
> More examples (esp. targeting miniscript on taproot) will be added in the
> future.
>
> == References ==
>
> * [1] - Output Script Descriptors:
> https://github.com/bitcoin/bitcoin/blob/master/doc/descriptors.md
> * [2] - BIP-129 (Bitcoin Secure Multisig Setup):
> https://github.com/bitcoin/bips/blob/master/bip-0129.mediawiki
> * [3] - BIP-44:
> https://github.com/bitcoin/bips/blob/master/bip-0044.mediawiki
> * [4] - BIP-49:
> https://github.com/bitcoin/bips/blob/master/bip-0049.mediawiki
> * [5] - BIP-84:
> https://github.com/bitcoin/bips/blob/master/bip-0084.mediawiki
> * [6] - BIP-86:
> https://github.com/bitcoin/bips/blob/master/bip-0086.mediawiki
> * [7] - BIP-48:
> https://github.com/bitcoin/bips/blob/master/bip-0048.mediawiki
> * [8] - BIP-87:
> https://github.com/bitcoin/bips/blob/master/bip-0087.mediawiki
>
> _______________________________________________
> bitcoin-dev mailing list
> bitcoin-dev@lists.linuxfoundation.org
> https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev
>

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<div dir=3D"ltr">I took a look at the spec for the wallet descriptor format=
, and I like the concept of having placeholder variables for keys. It reduc=
es the size of the descriptor,=C2=A0makes it substantially easier for a hum=
an to read/verify,=C2=A0especially in the future when we have more complex =
scripts,=C2=A0and provides a nice=C2=A0format for a script template which c=
an make it easier to verify that you&#39;re using the same script template =
as something else (ie besides using different keys). I think the `/**` synt=
ax is an improvement over the current descriptor format, however it is a bi=
t awkward and inflexible. My understanding is that some of this inflexibili=
ty comes from the goal of reducing memory usage, and I don&#39;t think I ha=
ve a good enough handle on that part of things to usefully comment. I&#39;v=
e put additional comments and suggestions on the format in <a href=3D"https=
://github.com/LedgerHQ/app-bitcoin-new/issues/35" target=3D"_blank">this gi=
thub issue</a>.=C2=A0<div><br></div><div>I think it would=C2=A0be very usef=
ul to come to agreement on a more flexible format that can support a much b=
roader set of use cases, and can potentially be a widely supported standard=
. I understand low-ram devices might have a much harder time using more fle=
xible (and complex) formats.</div><div><br></div><div><br></div><div><br></=
div><div><br><div><br></div><div><br></div></div></div><br><div class=3D"gm=
ail_quote"><div dir=3D"ltr" class=3D"gmail_attr">On Thu, May 5, 2022 at 9:3=
9 AM Salvatore Ingala via bitcoin-dev &lt;<a href=3D"mailto:bitcoin-dev@lis=
ts.linuxfoundation.org" target=3D"_blank">bitcoin-dev@lists.linuxfoundation=
.org</a>&gt; wrote:<br></div><blockquote class=3D"gmail_quote" style=3D"mar=
gin:0px 0px 0px 0.8ex;border-left:1px solid rgb(204,204,204);padding-left:1=
ex"><div dir=3D"ltr">In the implementation work to implement descriptors an=
d miniscript support in hardware wallets [a][b], I encountered a number of =
challenges. Some of them are technical in nature (e.g. due to constraints o=
f embedded development). Others are related to the attempts of shaping a go=
od user experience; with bitcoin reaching more people who are not tech-savv=
y, self-custody is only as secure as what those newcomers can use easily en=
ough.<br><br>The main tool that I am using to address some of these challen=
ges is a layer that sits _on top_ of descriptors/miniscript, while staying =
very close to it. Since there is nothing that is vendor-specific in the vas=
t majority of the approach I&#39;m currently using, I tried to distill it h=
ere for your comments, and will propose a BIP if this is deemed valuable.<b=
r><br>I called the language &quot;wallet policies&quot; (suggestions for a =
better name are welcome). I believe an approach based on wallet policies ca=
n benefit all hardware wallets (stateless or not) that want to securely sup=
port complex scripts; moreover, wallet policies are close enough to descrip=
tors that their integration should be extremely easy for any software walle=
t that=C2=A0is currently using descriptors.<br><br>[a]: <a href=3D"https://=
blog.ledger.com/bitcoin-2" target=3D"_blank">https://blog.ledger.com/bitcoi=
n-2</a> - early demo<div>[b]:=C2=A0<a href=3D"https://blog.ledger.com/minis=
cript-is-coming" target=3D"_blank">https://blog.ledger.com/miniscript-is-co=
ming</a> - miniscript example<br><br><br></div><div>Salvatore Ingala<br><br=
></div><div><br></div><div>=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=
=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=
=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D=3D<br><br>This document starts with a =
discussion on the motivation for wallet policies, followed by their formal =
definition, and some recommendations for implementations.</div><div><br>=3D=
=3D Rationale =3D=3D<br><br></div><div>Output script descriptors [1] were i=
ntroduced in bitcoin-core as a way to represent collections of output scrip=
ts. It is a very general and flexible language, designed to catch all the p=
ossible use-cases of bitcoin wallets (that is, if you know the script and y=
ou have the necessary keys, it will be possible to sign transactions with b=
itcoin-core&#39;s descriptor-based wallets).<br><br>Unfortunately, descript=
ors are not a perfect match for the typical usage of hardware wallets. Most=
 hardware wallets have the following limitations compared to a general-purp=
ose machine running bitcoin-core:<br><br>- they are embedded devices with l=
imited RAM and computational power;<br>- they might not be able to import a=
dditional private keys (all the keys are generated from a single seed via [=
BIP-32](<a href=3D"https://github.com/bitcoin/bips/blob/master/bip-0032.med=
iawiki)" target=3D"_blank">https://github.com/bitcoin/bips/blob/master/bip-=
0032.mediawiki)</a>);<br>- they might not have permanent storage (*stateles=
s* hardware wallet design).<br><br>Moreover, other limitations like the lim=
ited size of the screen might affect what design choices are available in p=
ractice. Therefore, minimizing the size of the information shown on-screen =
is important for a good user experience.<br><br>A more native, compact repr=
esentation of the wallet receive/change would also benefit the UX of softwa=
re wallets using descriptors to represent software wallets using descriptor=
s/miniscript for multisignature or other complex locking conditions.<br><br=
>=3D=3D=3D Security and UX concerns of scripts in hardware wallets =3D=3D=
=3D<br><br></div><div>For a hardware wallet, allowing the usage of complex =
scripts presents challenges in terms of both security and user experience.<=
br><br>=3D=3D=3D=3D Security issues =3D=3D=3D=3D</div><div><br>One of the s=
ecurity properties that hardware wallets strive to guarantee is the followi=
ng: **as long as the user correctly verifies the information that is shown =
on the hardware wallet&#39;s screen before approving, no action can be perf=
ormed without the user&#39;s consent**.<br>This must hold even in scenarios=
 where the attacker has full control of the machine that is connected to th=
e hardware wallet, and can execute arbitrary requests or tamper with the le=
gitimate user&#39;s requests.<br><br>Therefore, it is not at all trivial to=
 allow complex scripts, especially if they contain keys that belong to thir=
d parties.<br>The hardware wallet must guarantee that the user knows precis=
ely *what* &quot;policy&quot; is being used to spend the funds, and that th=
e &quot;unspent&quot; funds (if any) will be protected by the same policy. =
This makes it impossible for an attacker to surreptitiously modify the poli=
cy, therefore stealing or burning user&#39;s funds.<br><br>=3D=3D=3D=3D UX =
issues =3D=3D=3D=3D</div><div><br>With miniscript (and taproot trees) allow=
ing substantially more complex spending policies to be used, it becomes mor=
e challenging to make sure that the user is able _in practice_ to verify th=
e information on the screen. Therefore, there are two fundamental design go=
als to strive for:<br>- Minimize the amount of information that is shown on=
 screen - so that the user can actually validate it.<br>- Minimize the numb=
er of times the user has to validate such information.<br><br>Designing a s=
ecure protocol for the coordination of a descriptor wallet among distant pa=
rties is also a challenging problem that is out of scope in this document. =
See BIP-129 [2] for an approach designed for multisignature wallets.<br><br=
>=3D=3D=3D Policy registration as a solution =3D=3D=3D</div><div><br>A solu=
tion to address the security concerns, and part of the UX concerns, is to h=
ave a *registration* flow for the wallet policy in the hardware wallet. The=
 &quot;wallet policy&quot; must contain enough information to generate all =
the relevant addresses/scripts, and for the hardware wallet to identify the=
 keys that it controls and that are needed to spend the funds sent to those=
 addresses.<br><br>Before a new policy is used for the first time, the user=
 will register a `wallet policy` into the hardware wallet. While the detail=
s of the process are out of scope in this document, the flow should be some=
thing similar to the following:<br><br>1) The software wallet initiates a _=
wallet policy registration_ on the hardware wallet; the information should =
include the wallet policy, but also a unique *name* that identifies the pol=
icy.<br>2) The hardware wallet shows the wallet policy to the user using th=
e secure screen.<br>3) After inspecting the policy and comparing it with a =
trusted source (for example a printed backup), the user approves the policy=
.<br>4) If stateful, the hardware wallet persists the policy in its permane=
nt memory; if stateless, it returns a &quot;proof of registration&quot;.<br=
><br>The details of how to create a proof of registration are out of scope =
for this document; using a *message authentication codes* on a hash committ=
ing to the wallet policy, its name and any additional metadata is an effect=
ive solution if correctly executed.<br><br>Once a policy is registered, the=
 hardware wallet can perform the usual operations securely:<br>- generating=
 receive and change addresses;<br>- showing addresses on the secure screen;=
<br>- sign transactions spending from a wallet, while correctly identifying=
 change addresses and computing the transaction fees.<br><br>Before any of =
the actions mentioned above, the hardware wallet will retrieve the policy f=
rom its permanent storage if stateful; if stateless it will validate the _p=
roof of registration_ before using the wallet policy provided by the client=
.<br>Once the previously registered policy is correctly identified and appr=
oved by the user (for example by its name), and *as long as the policy regi=
stration was executed securely*, hardware wallets can provide a user experi=
ence similar to the usual one for single-signature transactions.<br><br>=3D=
=3D=3D Avoiding blowup in descriptor size =3D=3D=3D</div><div><br>While reu=
sing a pubkey in different branches of a miniscript is explicitly forbidden=
 by miniscript (as it has certain negative security implications), it is st=
ill reasonable to reuse the same *xpub* in multiple places, albeit with dif=
ferent final steps of derivation (so that the actual pubkeys that are used =
in the script are indeed different).<br><br>For example, using Taproot, a *=
3*-of-*5* multisignature wallet could use:<br>- a key path with a 5-of-5 Mu=
Sig<br>- a script tree with a tree of 10 different 3-of-3 MuSig2 scripts, t=
hat are generated, plus a leaf with a fallback *3*-of-*5* multisignature us=
ing plain multisignature (with `OP_CHECKSIGADD`).<br><br>This could look si=
milar to:<br><br>```<br>tr(musig2(xpubA,xpubB,xpubC,xpubD,xpubE)/&lt;0;1&gt=
;/*), {<br>=C2=A0 {<br>=C2=A0 =C2=A0 {<br>=C2=A0 =C2=A0 =C2=A0 pk(musig2(xp=
ubA,xpubB,xpubC)/&lt;2;3&gt;/*),<br>=C2=A0 =C2=A0 =C2=A0 {<br>=C2=A0 =C2=A0=
 =C2=A0 =C2=A0 pk(musig2(xpubA,xpubB,xpubD)/&lt;4;5&gt;/*)<br>=C2=A0 =C2=A0=
 =C2=A0 =C2=A0 pk(musig2(xpubA,xpubB,xpubE)/&lt;6;7&gt;/*),<br>=C2=A0 =C2=
=A0 =C2=A0 }<br>=C2=A0 =C2=A0 },<br>=C2=A0 =C2=A0 {<br>=C2=A0 =C2=A0 =C2=A0=
 pk(musig2(xpubA,xpubC,xpubD)/&lt;8;9&gt;/*),<br>=C2=A0 =C2=A0 =C2=A0 {<br>=
=C2=A0 =C2=A0 =C2=A0 =C2=A0 pk(musig2(xpubA,xpubC,xpubE)/&lt;10;11&gt;/*),<=
br>=C2=A0 =C2=A0 =C2=A0 =C2=A0 pk(musig2(xpubA,xpubD,xpubE)/&lt;12;13&gt;/*=
)<br>=C2=A0 =C2=A0 =C2=A0 }<br>=C2=A0 =C2=A0 }<br>=C2=A0 },<br>=C2=A0 {<br>=
=C2=A0 =C2=A0 {<br>=C2=A0 =C2=A0 =C2=A0 pk(musig2(xpubB,xpubC,xpubD)/&lt;14=
;15&gt;/*),<br>=C2=A0 =C2=A0 =C2=A0 pk(musig2(xpubB,xpubC,xpubE)/&lt;16;17&=
gt;/*)<br>=C2=A0 =C2=A0 },<br>=C2=A0 =C2=A0 {<br>=C2=A0 =C2=A0 =C2=A0 pk(mu=
sig2(xpubB,xpubD,xpubE)/&lt;18;19&gt;/*),<br>=C2=A0 =C2=A0 =C2=A0 {<br>=C2=
=A0 =C2=A0 =C2=A0 =C2=A0 pk(musig2(xpubC,xpubD,xpubE)/&lt;20;21&gt;/*),<br>=
=C2=A0 =C2=A0 =C2=A0 =C2=A0 sortedmulti_a(3,<br>=C2=A0 =C2=A0 =C2=A0 =C2=A0=
 =C2=A0 xpubA/&lt;22;23&gt;/*,<br>=C2=A0 =C2=A0 =C2=A0 =C2=A0 =C2=A0 xpubB/=
&lt;22;23&gt;/*,<br>=C2=A0 =C2=A0 =C2=A0 =C2=A0 =C2=A0 xpubC/&lt;22;23&gt;/=
*,<br>=C2=A0 =C2=A0 =C2=A0 =C2=A0 =C2=A0 xpubD/&lt;22;23&gt;/*,<br>=C2=A0 =
=C2=A0 =C2=A0 =C2=A0 =C2=A0 xpubE/&lt;22;23&gt;/*)<br>=C2=A0 =C2=A0 =C2=A0 =
}<br>=C2=A0 =C2=A0 }<br>=C2=A0 }<br>})<br>```<br><br>Note that each root xp=
ub appears 8 times. With xpubs being up to 118 bytes long, the length of th=
e full descriptor can get extremely long (the problem gets *exponentially* =
worse with larger multisignature schemes).<br><br>Replacing the common part=
 of the key with a short key placeholder and moving the key expression sepa=
rately helps to keep the size of the wallet policy small, which is crucial =
to allow human inspection in the registration flow.<br><br>=3D=3D=3D Restri=
ctions on the supported descriptors =3D=3D=3D=3D<br><br>The policy language=
 proposed in this document purposely targets only a stricter subset of the =
output descriptors language, and it attempts to generalize in the most natu=
ral way the approach that is already used for single-signature *accounts* (=
as described in BIP-44 [3], BIP-49 [4], BIP-84 [5], or BIP-86 [6]), or in m=
ultisignature setups (see for example BIP-48 [7] and BIP-87 [8]).</div><div=
><br>Unlike the BIPs mentioned above, it is not tied to any specific script=
 template, as it applies to arbitrary scripts that can be represented with =
descriptors and miniscript.<br><br>Supporting only a reduced feature set wh=
en compared to output descriptors helps in implementations (especially on h=
ardware wallets), while attempting to capture all the common use cases. Mor=
e features can be added in the future if motivated by real world necessity.=
<br><br>By keeping the structure of the wallet policy language very close t=
o that of descriptors, it should be straightforward to:<br>- write wallet p=
olicy parsers;<br>- extract the descriptors defined by a wallet policy;<br>=
- convert a pair of descriptors describing a wallet &quot;account&quot; use=
d in current implementations into the corresponding wallet policy.<br><br><=
br>=3D=3D Wallet policies =3D=3D</div><div><br>This section formally define=
s wallet policies, and how they relate to output script descriptors.</div><=
div><br>=3D=3D=3D Formal definition =3D=3D=3D</div><div><br></div><div>A wa=
llet policy is composed by a wallet descriptor template, together with a ve=
ctor of key information items.<br><br>=3D=3D=3D=3D Wallet descriptor templa=
te =3D=3D=3D=3D<br><br>A wallet descriptor template is a `SCRIPT` expressio=
n.<br><br>`SCRIPT` expressions:<br>- `sh(SCRIPT)` (top level only): P2SH em=
bed the argument.<br>- `wsh(SCRIPT)` (top level or inside `sh` only): P2WSH=
 embed the argument.<br>- `pkh(KP)` (not inside `tr`): P2PKH output for the=
 given public key (use `addr` if you only know the pubkey hash).<br>- `wpkh=
(KP)` (top level or inside `sh` only): P2WPKH output for the given compress=
ed pubkey.<br>- `multi(k,KP_1,KP_2,...,KP_n)`: k-of-n multisig script.<br>-=
 `sortedmulti(k,KP_1,KP_2,...,KP_n)`: k-of-n multisig script with keys sort=
ed lexicographically in the resulting script.<br>- `tr(KP)` or `tr(KP,TREE)=
` (top level only): P2TR output with the specified key as internal key, and=
 optionally a tree of script paths.</div><div>- any valid miniscript templa=
te (inside `wsh` or `tr` only).</div><div><br>`TREE` expressions:<br>- any =
`SCRIPT` expression<br>- An open brace `{`, a `TREE` expression, a comma `,=
`, a `TREE` expression, and a closing brace `}`<br><br><div>Note: &quot;min=
iscript templates&quot; are not formally=C2=A0defined in this version of th=
e document, but it is straightforward=C2=A0to adapt this approach.<br></div=
><br>`KP` expressions (key placeholders) consist of<br>- a single character=
 `@`<br>- followed by a non-negative decimal number, with no leading zeros =
(except for `@0`).<br>- possibly followed by either:<br>=C2=A0 - the string=
 =C2=A0`/**`, or<br>=C2=A0 - a string of the form `/&lt;NUM;NUM&gt;/*`, for=
 two distinct decimal numbers `NUM` representing unhardened derivations<br>=
<br>The `/**` in the placeholder template represents commonly used paths fo=
r receive/change addresses, and is equivalent to `&lt;0;1&gt;`.<br><br>The =
placeholder `@i` for some number *i* represents the *i*-th key in the vecto=
r of key origin information (which must be of size at least *i* + 1, or the=
 wallet policy is invalid).<br></div><div><br></div><div>=3D=3D=3D=3D Key i=
nformations vector =3D=3D=3D=3D<br><br>Each element of the key origin infor=
mation vector is a `KEY` expression.<br><br>- Optionally, key origin inform=
ation, consisting of:<br>=C2=A0 - An open bracket `[`<br>=C2=A0 - Exactly 8=
 hex characters for the fingerprint of the master key from which this key i=
s derived from (see [BIP32](<a href=3D"https://github.com/bitcoin/bips/blob=
/master/bip-0032.mediawiki" target=3D"_blank">https://github.com/bitcoin/bi=
ps/blob/master/bip-0032.mediawiki</a>) for details)<br>=C2=A0 - Followed by=
 zero or more `/NUM&#39;` path elements to indicate hardened derivation ste=
ps between the fingerprint and the xpub that follows<br>=C2=A0 - A closing =
bracket `]`<br>- Followed by the actual key, which is either<br>=C2=A0 - a =
hex-encoded pubkey, which is either<br>=C2=A0 =C2=A0 - inside=C2=A0`wpkh`=
=C2=A0and=C2=A0`wsh`, only compressed public keys are permitted (exactly 66=
 hex characters starting with `02` or `03`.<br>=C2=A0 =C2=A0 - inside `tr`,=
 x-only pubkeys are also permitted (exactly 64 hex characters).<br>=C2=A0 -=
 a serialized extended public key (`xpub`) (as defined in [BIP 32](<a href=
=3D"https://github.com/bitcoin/bips/blob/master/bip-0032.mediawiki" target=
=3D"_blank">https://github.com/bitcoin/bips/blob/master/bip-0032.mediawiki<=
/a>))<br><br>The placeholder `@i` for some number *i* represents the *i*-th=
 key in the vector of key orIgin information=C2=A0(which must be of size at=
 least *i* + 1, or the wallet policy is invalid).<br><br>The policy templat=
e is invalid if any placeholder `@i` has derivation steps while the corresp=
onding `(i+1)`-th element of the keys vector is not an xpub.<br><br>=3D=3D=
=3D=3D Additional rules =3D=3D=3D=3D</div><div><br>The wallet policy is inv=
alid if any placeholder expression with additional derivation steps is used=
 when the corresponding key information is not an xpub.<br><br>The key info=
rmation vector *should* be ordered so that placeholder `@i` never appear fo=
r the first time before an occurrence of `@j` =C2=A0for some `j &lt; i`; fo=
r example, the first placeholder is always `@0`, the next one is `@1`, etc.=
<br><br>=3D=3D=3D Descriptor derivation =3D=3D=3D</div><div><br>From a wall=
et descriptor template (and the associated vector of key informations), one=
 can therefore obtain the 1-dimensional descriptor for receive and change a=
ddresses by:<br><br>- replacing each key placeholder with the corresponding=
 key origin information;<br>- replacing every `/**` =C2=A0with `/0/*` for t=
he receive descriptor, and `/1/*` for the change descriptor;<br>- replacing=
 every `/&lt;M,N&gt;` with =C2=A0`/M` for the receive descriptor, and `/N` =
for the change descriptor.<br><br>For example, the wallet descriptor `pkh(@=
0/**)` with key information `[&quot;[d34db33f/44&#39;/0&#39;/0&#39;]xpub6ER=
ApfZwUNrhLCkDtcHTcxd75RbzS1ed54G1LkBUHQVHQKqhMkhgbmJbZRkrgZw4koxb5JaHWkY4AL=
HY2grBGRjaDMzQLcgJvLJuZZvRcEL&quot;]` produces the following two descriptor=
s:<br><br>- Receive descriptor: `pkh([d34db33f/44&#39;/0&#39;/0&#39;]xpub6E=
RApfZwUNrhLCkDtcHTcxd75RbzS1ed54G1LkBUHQVHQKqhMkhgbmJbZRkrgZw4koxb5JaHWkY4A=
LHY2grBGRjaDMzQLcgJvLJuZZvRcEL/0/*)`<br><br>- Change descriptor: `pkh([d34d=
b33f/44&#39;/0&#39;/0&#39;]xpub6ERApfZwUNrhLCkDtcHTcxd75RbzS1ed54G1LkBUHQVH=
QKqhMkhgbmJbZRkrgZw4koxb5JaHWkY4ALHY2grBGRjaDMzQLcgJvLJuZZvRcEL/1/*)`<br><b=
r>=3D=3D=3D Implementation guidelines =3D=3D=3D</div><div><br>Implementatio=
ns must not necessarily implement all of the possible wallet policies defin=
ed by this standard, but it is recommended to clearly document any limitati=
on. =C2=A0<br><br>Implementations can add additional metadata that is store=
d together with the wallet policy for the purpose of wallet policy registra=
tion and later usage. Metadata can be vendor-specific and is out of the sco=
pe of this document.<br><br>Any implementation in a general-purpose softwar=
e wallet allowing arbitrary scripts (or any scripts that involve external c=
osigners) should put great care into a process for backing up a wallet poli=
cy. In fact, unlike typical single-signature scenarios, the seed alone is n=
o longer enough to discover wallet policies with existing funds, and the lo=
ss of the backup is likely to lead to permanent loss of funds.<br><br>Avoid=
ing key reuse among different wallet accounts is also extremely important, =
but out of scope for this document.<br><br>=3D=3D Examples =3D=3D<br><br>So=
me examples of wallet descriptor templates (vectors of keys omitted for sim=
plicity):</div><div>- Template for a native segwit account:</div><div>=C2=
=A0 wpkh(@0/**)<br><div>- Template for a taproot BIP86 account:</div><div>=
=C2=A0 tr(@0/**)<br></div></div><div>- Template for a native segwit 2-of-3:=
</div><div>=C2=A0 wsh(sortedmulti(2,@0/**,@1/**,@2/**))</div><div>- Templat=
e with miniscript for &quot;1 of 2 equally likely keys&quot;:</div><div>=C2=
=A0 wsh(or_b(pk(@0/**),s:pk(@1/**)))</div><div><br></div><div>More examples=
 (esp. targeting miniscript on taproot) will be added in the future.</div><=
div><br></div><div>=3D=3D References =3D=3D<br></div><div><br></div><div>* =
[1] - Output Script Descriptors: <a href=3D"https://github.com/bitcoin/bitc=
oin/blob/master/doc/descriptors.md" target=3D"_blank">https://github.com/bi=
tcoin/bitcoin/blob/master/doc/descriptors.md</a></div><div>* [2] - BIP-129 =
(Bitcoin Secure Multisig Setup): <a href=3D"https://github.com/bitcoin/bips=
/blob/master/bip-0129.mediawiki" target=3D"_blank">https://github.com/bitco=
in/bips/blob/master/bip-0129.mediawiki</a><br></div><div>* [3] - BIP-44: <a=
 href=3D"https://github.com/bitcoin/bips/blob/master/bip-0044.mediawiki" ta=
rget=3D"_blank">https://github.com/bitcoin/bips/blob/master/bip-0044.mediaw=
iki</a></div><div>* [4] - BIP-49: <a href=3D"https://github.com/bitcoin/bip=
s/blob/master/bip-0049.mediawiki" target=3D"_blank">https://github.com/bitc=
oin/bips/blob/master/bip-0049.mediawiki</a></div><div>* [5] - BIP-84: <a hr=
ef=3D"https://github.com/bitcoin/bips/blob/master/bip-0084.mediawiki" targe=
t=3D"_blank">https://github.com/bitcoin/bips/blob/master/bip-0084.mediawiki=
</a></div><div>* [6] - BIP-86: <a href=3D"https://github.com/bitcoin/bips/b=
lob/master/bip-0086.mediawiki" target=3D"_blank">https://github.com/bitcoin=
/bips/blob/master/bip-0086.mediawiki</a></div><div>* [7] - BIP-48: <a href=
=3D"https://github.com/bitcoin/bips/blob/master/bip-0048.mediawiki" target=
=3D"_blank">https://github.com/bitcoin/bips/blob/master/bip-0048.mediawiki<=
/a></div><div>* [8] - BIP-87: <a href=3D"https://github.com/bitcoin/bips/bl=
ob/master/bip-0087.mediawiki" target=3D"_blank">https://github.com/bitcoin/=
bips/blob/master/bip-0087.mediawiki</a></div><div><br></div></div>
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</blockquote></div>

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