From 0e6a03ad54a8145e8249811b365f03b2e47fad43 Mon Sep 17 00:00:00 2001
From: Luis Covarrubias <luiscovarrubias@bitgo.com>
Date: Tue, 2 Dec 2025 14:41:59 -0800
Subject: [PATCH] feat: add LTC cross-chain recovery support

Implement Litecoin address format conversion for cross-chain recovery
when LTC was sent to BTC addresses. This conversion allows the recovery
process to match LTC M-addresses with BTC 3-addresses stored in wallet.

Co-authored-by: llm-git <llm-git@ttll.de>

Ticket: BTC-2829

TICKET: BTC-2829
---
 .../src/recovery/crossChainRecovery.ts        | 47 ++++++++++++++++++-
 .../test/unit/recovery/crossChainRecovery.ts  | 30 ++++++++++++
 2 files changed, 76 insertions(+), 1 deletion(-)

diff --git a/modules/abstract-utxo/src/recovery/crossChainRecovery.ts b/modules/abstract-utxo/src/recovery/crossChainRecovery.ts
index 420ea01fbd..826f81fe60 100644
--- a/modules/abstract-utxo/src/recovery/crossChainRecovery.ts
+++ b/modules/abstract-utxo/src/recovery/crossChainRecovery.ts
@@ -113,6 +113,40 @@ export async function isWalletAddress(wallet: IWallet | WalletV1, address: strin
   }
 }
 
+/**
+ * Convert a Litecoin P2SH address from M... format (scriptHash 0x32) to the legacy 3... format (scriptHash 0x05).
+ * This is needed for cross-chain recovery when LTC was sent to a BTC address, because the BTC wallet
+ * stores addresses in the 3... format while the LTC blockchain returns addresses in M... format.
+ *
+ * @param address - LTC address to convert
+ * @param network - The Litecoin network
+ * @returns The address in legacy 3... format, or the original address if it's not a P2SH address
+ */
+export function convertLtcAddressToLegacyFormat(address: string, network: utxolib.Network): string {
+  try {
+    // Try to decode as bech32 - these don't need conversion
+    utxolib.address.fromBech32(address);
+    return address;
+  } catch (e) {
+    // Not bech32, continue to base58
+  }
+
+  try {
+    const decoded = utxolib.address.fromBase58Check(address, network);
+    // Only convert P2SH addresses (scriptHash), not P2PKH (pubKeyHash)
+    if (decoded.version === network.scriptHash) {
+      // Convert to legacy format using Bitcoin's scriptHash (0x05)
+      const legacyScriptHash = utxolib.networks.bitcoin.scriptHash;
+      return utxolib.address.toBase58Check(decoded.hash, legacyScriptHash, network);
+    }
+    // P2PKH or other - return unchanged
+    return address;
+  } catch (e) {
+    // If decoding fails, return the original address
+    return address;
+  }
+}
+
 /**
  * @param coin
  * @param txid
@@ -137,7 +171,18 @@ async function getAllRecoveryOutputs<TNumber extends number | bigint = number>(
         // in non legacy format. However, we want to keep the address in the same format as the response since we
         // are going to hit the API again to fetch address unspents.
         const canonicalAddress = coin.canonicalAddress(output.address);
-        const isWalletOwned = await isWalletAddress(wallet, canonicalAddress);
+        let isWalletOwned = await isWalletAddress(wallet, canonicalAddress);
+
+        // For LTC cross-chain recovery: if the address isn't found, try the legacy format.
+        // When LTC is sent to a BTC address, the LTC blockchain returns M... addresses
+        // but the BTC wallet stores addresses in 3... format.
+        if (!isWalletOwned && coin.getFamily() === 'ltc') {
+          const legacyAddress = convertLtcAddressToLegacyFormat(output.address, coin.network);
+          if (legacyAddress !== output.address) {
+            isWalletOwned = await isWalletAddress(wallet, legacyAddress);
+          }
+        }
+
         return isWalletOwned ? output.address : null;
       })
     )
diff --git a/modules/abstract-utxo/test/unit/recovery/crossChainRecovery.ts b/modules/abstract-utxo/test/unit/recovery/crossChainRecovery.ts
index 2a5ad48e6d..1d7edcfae6 100644
--- a/modules/abstract-utxo/test/unit/recovery/crossChainRecovery.ts
+++ b/modules/abstract-utxo/test/unit/recovery/crossChainRecovery.ts
@@ -14,6 +14,7 @@ import {
   getWallet,
   supportedCrossChainRecoveries,
   generateAddress,
+  convertLtcAddressToLegacyFormat,
 } from '../../../src';
 import {
   getFixture,
@@ -327,3 +328,32 @@ describe(`Cross-Chain Recovery getWallet`, async function () {
     }
   });
 });
+
+describe('convertLtcAddressToLegacyFormat', function () {
+  const ltcNetwork = utxolib.networks.litecoin;
+
+  it('should convert M... P2SH address to 3... legacy format', function () {
+    // These two addresses represent the same underlying script hash:
+    // - MNQ7zkgMsaV67rsjA3JuP59RC5wxRXpwgE is the LTC format (scriptHash 0x32)
+    // - 3GBygsGPvTdfKMbq4AKZZRu1sPMWPEsBfd is the BTC format (scriptHash 0x05)
+    const ltcAddress = 'MNQ7zkgMsaV67rsjA3JuP59RC5wxRXpwgE';
+    const expectedLegacyAddress = '3GBygsGPvTdfKMbq4AKZZRu1sPMWPEsBfd';
+
+    const legacyAddress = convertLtcAddressToLegacyFormat(ltcAddress, ltcNetwork);
+    assert.strictEqual(legacyAddress, expectedLegacyAddress);
+  });
+
+  it('should convert MD68PsdheKxcYsrVLyZRXgoSDLnB1MdVtE to legacy format', function () {
+    const address = 'MD68PsdheKxcYsrVLyZRXgoSDLnB1MdVtE';
+    const legacyAddress = convertLtcAddressToLegacyFormat(address, ltcNetwork);
+
+    // Should start with '3' (legacy BTC P2SH format)
+    assert.ok(legacyAddress.startsWith('3'), `Expected address to start with '3', got: ${legacyAddress}`);
+  });
+
+  it('should not modify bech32 addresses', function () {
+    const bech32Address = 'ltc1qgrl8zpndsklaa9swgd5vevyxmx5x63vcrl7dk4';
+    const result = convertLtcAddressToLegacyFormat(bech32Address, ltcNetwork);
+    assert.strictEqual(result, bech32Address);
+  });
+});