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Compressed Transaction Schema

By (Tom Briar) and (Andrew Poelstra)

1. Abstract

With this Transaction Compression Schema we use several methods to compress transactions, including dropping data and recovering it on decompression by grinding until we obtain valid signatures.

The bulk of our size savings come from replacing the prevout of each input by a block height and index. This requires the decompression to have access to the blockchain, and also means that compression is ineffective for transactions that spend unconfirmed or insufficiently confirmed outputs.

Even without compression, Taproot keyspends are very small: as witness data they include only a single 64/65-byte signature and do not repeat the public key or any other metadata. By using pubkey recovery, we obtain Taproot-like compression for legacy and Segwit transactions.

The main applications for this schema are for steganography, satellite/radio broadcast, and other low bandwidth channels with a high CPU availability on decompression. We assume users have some ability to shape their transactions to improve their compressibility, and therefore give special treatment to certain transaction forms.

This schema is easily reversible except for compressing the Txid/Vout input pairs(Method 4). Compressing the input Txid/Vout is optional, and without it still gleans 50% of the total compression. This allows for the additional use case of P2P communication.

2. Methods

The four main methods to achieve a lower transactions size are:

  1. Packing transaction metadata before the transaction and each of its inputs and outputs to determine the structure of the following data.
  2. Replacing 32-bit numeric values with either variable-length integers (VarInts) or compact-integers (CompactSizes).
  3. Using compressed signatures and public key recovery upon decompression.
  4. Replacing the 36-byte txid/vout pair with a blockheight and output index.

Method 4 will cause the compressed transaction to be undecompressable if a block reorg occurs at or before the block it's included in. Therefore, we'll only compress the Txid if the transaction input is at least one hundred blocks old.

3 Schema

3.1 Primitives

Name Width Description
CompactSize 1-5 Bytes For 0-253, encode the value directly in one byte. For 254-65535, encode 254 followed by 2 little-endian bytes. For 65536-(2^32-1), encode 255 followed by 4 little-endian bytes.
CompactSize flag 2 Bits 1, 2 or 3 indicate literal values. 0 indicates that the value will be encoded in a later CompactInt.
VarInt 1+ Bytes 7-bit little-endian encoding, with each 7-bit word encoded in a byte. The highest bit of each byte is 1 if more bytes follow, and 0 for the last byte.
VLP-Bytestream 2+ Bytes A VarInt Length Prefixed Bytestream. Has a VarInt prefixed to determine the length.

3.2 General Schema

Name Width Description
Transaction Metadata 1 Byte Information on the structure of the transaction. See Section 3.3.
Version 0-5 Bytes An optional CompactSize containing the transactions version.
Input Count 0-5 Bytes An optional CompactSize containing the transactions input count.
Output Count 0-5 Bytes An optional CompactSize containing the transactions output count.
LockTime 0-5 Bytes An optional CompactSize containing the transaction LockTime if its non zero.
Minimum Blockheight 1-5 Bytes A VarInt containing the Minimum Blockheight of which the transaction locktime and input blockheights are given as offsets.
Input Metadata+Output Metadata 1+ Bytes A Encoding containing metadata on all the inputs and then all the outputs of the transaction. For each input see Section 3.4, for each output see Section 3.5.
Input Data 66+ Bytes See Section 3.6 for each input.
Output Data 3+ Bytes See Section 3.7 for each output.

For the four CompactSize listed above we could use a more compact bit encoding for these but they are already a fall back for the bit encoding of the Transaction Metadata.

3.3 Transaction Metadata

Name Width Description
Version 2 Bits A CompactSize flag for the transaction version.
Input Count 2 Bits A CompactSize flag for the transaction input count.
Output Count 2 Bits A CompactSize flag for the transaction output count.
LockTime 1 Bit A Boolean to indicate if the transaction has a LockTime.

3.4 Input Metadata

Name Width Description
Compressed Signature 1 Bit Signature compression flag.
Pubkey Hash Included 1 Bit Weather or not the Hash of the Public key used in the Redeem Script for P2SH-WPKH has been included.
Standard Hash 1 Bit A flag to determine if this Input's Signature Hash Type is standard (0x00 for Taproot, 0x01 for Legacy/Segwit).
Standard Sequence 2 Bits A CompactSize flag for the inputs sequence. Encode literal values as follows: 1 = 0x00000000, 2 = 0xFFFFFFFE, 3 = 0xFFFFFFFF.

3.5.1 Output Metadata

Name Width Description
Encoded Script Type 3 Bits Encoded Script Type.

3.5.2 Script Type encoding

Script Type Value
Uncompressed Custom Script 0b000
Uncompressed P2PK 0b001
Compressed P2PK 0b010
P2PKH 0b011
P2SH 0b100
P2WPKH 0b101
P2WSH 0b110
P2TR 0b111

3.6 Input Data

Name Width Description
Sequence 0-5 Bytes An Optional VarInt containing the sequence if it was non-standard.
Txid Blockheight 1-5 Bytes A VarInt Either containing 0 if this an uncompressed input, or it contains the offset from Minimum Blockheight for this Txid.
Txid/Signature Data 65+ Bytes Txid/Signatures are determined to be uncompressed either by the output script of the previous transaction, or if the Txid Blockheight is zero. For each Compressed Txid/Signature See Section 3.6.1. For each Uncompressed Txid/Signature See Section 3.6.2.

3.6.1 Compressed Txid/Signature Data

Name Width Description
Txid Block Index 1-5 Bytes A VarInt containing the flattened index from the Txid Blockheight for the Vout.
Signature 64 Bytes Contains the 64 byte signature.
Public Key Hash 0-20 Bytes If input is P2SH-P2WPKH contains the 20 byte hash of the public key.
Hash Type 0-1 Bytes An Optional Byte containing the Hash Type if it was non-standard.

3.6.2 Uncompressed Txid/Signature Data

Name Width Description
Txid 32 Bytes Contains the 32 byte Txid.
Vout 1-5 Bytes A CompactSize Containing the Vout of the Txid.
Signature 2+ Bytes A VLP-Bytestream containing the signature.

3.7 Output Data

Name Width Description
Output Script 2+ Bytes A VLP-Bytestream containing the output script.
Amount 1-9 Bytes A VarInt containing the output amount.

4 Ideal Transaction

The target transaction for the most optimal compression was chosen based off the most common transactions that are likely to be used for purposes that requires the best compression.

Field Requirements Possible Savings
Version Less than four 30 Bits
Input Count Less then four 30 Bits
Output Count Less then four 30 Bits
LockTime 0 30 Bits
Input Sequence 0x00, 0xFFFFFFFE, or 0xFFFFFFFF 62 Bits For Each Input
Input Txid Compressed Outpoint 23-31 Bytes For Each Input
Input Vout Compressed Outpoint (-1)-3 Bytes For Each Input
Input Signature Non-custom Script Signing 40-72 Bytes For Each Legacy Input
Input Hash Type 0x00 for Taproot, 0x01 for Legacy 7 Bits For Each Input
Output Script Non-custom Scripts 2-5 Bytes For Each Output
Output Amount No Restrictions (-1)-7 Bytes For Each Output

5 Test Vectors

Transaction Before Compression After Compression Savings
1-(input/output) P2TR 150 Bytes 101 Bytes 98 Bytes / 32%
1-(input/output) P2WPKH 191 Bytes 101 Bytes 180 Bytes / 47%
1-(input/output) P2SH-P2WPKH 214 Bytes 121 Bytes 186 Bytes / 43%
1-(input/output) P2PKH 188 Bytes 101 Bytes 174 Bytes / 46%

5.1 Taproot

5.1.1 Uncompressed

020000000001017ad1d0cc314504ec06f1b5c786c50cf3cda30bd5be88cf08ead571b0ce7481fb0000000000fdffffff0188130000000000001600142da377ed4978fefa043a58489912f8e28e16226201408ce65b3170d3fbc68e3b6980650514dc53565f915d14351f83050ff50c8609495b7aa96271c3c99cdac1a92b1b45e77a4a870251fc1673596793adf2494565e500000000

5.1.2 Compressed

16b1ec7f2d01b0218ce65b3170d3fbc68e3b6980650514dc53565f915d14351f83050ff50c8609495b7aa96271c3c99cdac1a92b1b45e77a4a870251fc1673596793adf2494565e58efefefe7d2da377ed4978fefa043a58489912f8e28e162262a608

5.2 P2WPKH

5.2.1 Uncompressed

0200000000010144bcf05ab48b8789268a7ca07133241ad654c0739ac7165015b2d669eadb10ea0000000000fdffffff0188130000000000001600142da377ed4978fefa043a58489912f8e28e16226202473044022043ab639a98dfbc704f16a35bf25b8b72acb4cb928fd772285f1fcf63725caa85022001c9ff354504e7024708bce61f30370c8db13da8170cef4e8e4c4cdad0f71bfe0121030072484c24705512bfb1f7f866d95f808d81d343e552bc418113e1b9a1da0eb400000000

5.2.2 Compressed

16b1ec712d01932643ab639a98dfbc704f16a35bf25b8b72acb4cb928fd772285f1fcf63725caa8501c9ff354504e7024708bce61f30370c8db13da8170cef4e8e4c4cdad0f71bfe8efefefe7d2da377ed4978fefa043a58489912f8e28e162262a608

5.3 P2SH-P2WPKH

5.3.1 Uncompressed

0200000000010192fb2e4332b43dc9a73febba67f3b7d97ba890673cb08efde2911330f77bbdfc00000000171600147a1979232206857167b401fdac1ffbf33f8204fffdffffff0188130000000000001600142da377ed4978fefa043a58489912f8e28e16226202473044022041eb682e63c25b85a5a400b11d41cf4b9c25f309090a5f3e0b69dc15426da90402205644ddc3d5179bab49cce4bf69ebfaeab1afa34331c1a0a70be2927d2836b0e8012103c483f1b1bd24dd23b3255a68d87ef9281f9d080fd707032ccb81c1cc56c5b00200000000

5.3.2 Compressed

16b1ec7c3d01981641eb682e63c25b85a5a400b11d41cf4b9c25f309090a5f3e0b69dc15426da9045644ddc3d5179bab49cce4bf69ebfaeab1afa34331c1a0a70be2927d2836b0e87a1979232206857167b401fdac1ffbf33f8204ff8efefefe7d2da377ed4978fefa043a58489912f8e28e162262a608

5.4 P2PKH

5.4.1 Uncompressed

02000000015f5be26862482fe2fcc900f06ef26ee256fb205bc4773e5a402d0c1b88b82043000000006a473044022031a20f5d9212023b510599c9d53d082f8e07faaa2d51482e078f8e398cb50d770220635abd99220ad713a081c4f20b83cb3f491ed8bd032cb151a3521ed144164d9c0121027977f1b6357cead2df0a0a19570088a1eb9115468b2dfa01439493807d8f1294fdffffff0188130000000000001600142da377ed4978fefa043a58489912f8e28e16226200000000

5.4.2 Compressed

16b1ec7c2d01981431a20f5d9212023b510599c9d53d082f8e07faaa2d51482e078f8e398cb50d77635abd99220ad713a081c4f20b83cb3f491ed8bd032cb151a3521ed144164d9c8efefefe7d2da377ed4978fefa043a58489912f8e28e162262a608