Newsletters: add 321 (2024-09-20)

_posts/en/newsletters/2024-09-20-newsletter.md

@@ -0,0 +1,244 @@
+---
+title: 'Bitcoin Optech Newsletter #321'
+permalink: /en/newsletters/2024/09/20/
+name: 2024-09-20-newsletter
+slug: 2024-09-20-newsletter
+type: newsletter
+layout: newsletter
+lang: en
+---
+This week's newsletter links to a proof-of-concept implementation for
+proving in zero-knowledge that an output is part of the UTXO set,
+describes one new and two previous proposals for allowing offline LN
+payments, and summarizes research about DNS seeding for non-IP network
+addresses.  Also included are our regular sections describing changes to
+clients and services, announcing new releases and release candidates,
+and summarizing notable changes to popular Bitcoin infrastructure
+software.
+
+## News
+
+- **Proving UTXO set inclusion in zero knowledge:** Johan Halseth
+  [posted][halseth utxozk] to Delving Bitcoin to announce a
+  proof-of-concept tool that allows someone to prove that they control
+  one of the outputs in the current UTXO set without revealing which
+  output.  The eventual goal is to allow the co-owners of an LN funding
+  output to prove they control a channel without revealing any specific
+  information about their onchain transactions.  That proof can be
+  attached to next-generation [channel announcement messages][topic
+  channel announcements] that are used to build decentralized routing
+  information for LN.
+
+  The method used differs from the aut-ct method described in
+  [Newsletter #303][news303 aut-ct], and some of the discussion focused
+  on clarifying the differences.  Additional research is needed, with
+  Halseth describing several open problems.
+
+- **LN offline payments:** Andy Schroder [posted][schroder lnoff] to
+  Delving Bitcoin to sketch a communication process an LN wallet could
+  use to generate tokens that could be provided to an internet-connected
+  wallet in order to pay it.  For example, Alice's wallet would normally
+  be connected to an always-online LN node she controls or that is
+  controlled by a _Lightning service provider_ (LSP).  While online,
+  Alice will pregenerate authentication tokens.
+
+  Later, when Alice's node is offline and she wants to pay Bob, she
+  gives Bob an authentication token that allows him to connect to her
+  always-online node or LSP and withdraw an amount indicated by Alice.
+  She can provide the authentication token to Bob using [NFC][] or
+  another widely available data transfer protocol that doesn't require
+  Alice to access the internet, keeping the protocol simple and making
+  it easy to implement on devices with limited computing resources (such as
+  smart cards).
+
+  Developer ZmnSCPxj [mentioned][zmn lnoff] an alternative approach he
+  had previously described and Bastien Teinurier [referenced][t-bast
+  lnoff] a method for node remote control he designed for this type of
+  situation (see [Newsletter #271][news271 noderc]).
+
+- **DNS seeding for non-IP addresses:** developer Virtu [posted][virtu seed]
+  to Delving Bitcoin a survey of the availability of seed nodes on
+  [anonymity networks][topic anonymity networks] and discussed methods
+  for allowing new nodes that exclusively use those networks to learn
+  about peers through DNS seeders.
+
+  As background, a Bitcoin node or P2P client needs to learn the
+  network addresses of peers that it can download data from.  Newly
+  installed software, or software that has been offline for a long time,
+  may not know the network address of any active peers.  Normally,
+  Bitcoin Core nodes solve this by querying a DNS seed that returns the
+  IPv4 or IPv6 addresses of several peers that are likely to be
+  available.  If DNS seeding fails, or if it's unavailable (such as for
+  anonymity networks that don't use IPv4 or IPv6 addresses), Bitcoin
+  Core includes the network addresses of peers that were available when
+  the software release was made; those peers are used as _seed nodes_,
+  where the node requests additional peer addresses from the seed node
+  and uses them as potential peers.  DNS seeds are preferred over seed nodes
+  as their information is usually more current and the global DNS
+  caching infrastructure can prevent a DNS seed from learning the
+  network address of each querying node.
+
+  Virtu examined the seed nodes listed in the last four major
+  releases of Bitcoin Core and found that a satisfactory number of them
+  were still available, indicating that users of anonymity networks
+  should be able to find peers.  They and other discussion participants
+  also examined the possibility of modifying Bitcoin Core to allow it to
+  use DNS seeding for anonymity networks via either DNS `NULL` records
+  or encoding alternative network addresses into pseudo-IPv6 addresses.
+
+## Changes to services and client software
+
+*In this monthly feature, we highlight interesting updates to Bitcoin
+wallets and services.*
+
+- **Strike adds BOLT12 support:**
+  Strike [announced][strike blog] support for [BOLT12 offers][topic offers],
+  including using offers with [BIP353][] DNS payment instructions.
+
+- **BitBox02 adds silent payment support:**
+  BitBox02 [announced][bitbox blog sp] support for [silent payments][topic
+  silent payments] and an implementation of [payment requests][bitbox blog pr].
+
+- **The Mempool Open Source Project v3.0.0 released:**
+  The [v3.0.0 release][mempool github 3.0.0] includes new [CPFP][topic cpfp]
+  fee calculations, additional [RBF][topic rbf] features including fullrbf
+  support, P2PK support, and new mempool and blockchain analysis features, among
+  other changes.
+
+- **ZEUS v0.9.0 released:**
+  The [v0.9.0 post][zeus blog 0.9.0] outlines additional LSP features,
+  watch-only wallets, hardware signing device support, support for transaction
+  [batching][scaling payment batching] including channel open transactions, and other features.
+
+- **Live Wallet adds consolidation support:**
+  The Live Wallet application analyzes the cost to spend a set of UTXOs at
+  different feerates including determining when outputs would be
+  [uneconomical][topic uneconomical outputs] to spend. The [0.7.0 release][live
+  wallet github 0.7.0] includes features to simulate [consolidation][consolidate
+  info] transactions and generate consolidation [PSBTs][topic psbt].
+
+- **Bisq adds Lightning support:**
+  [Bisq v2.1.0][bisq github v2.1.0] adds the ability for users to settle trades using the Lightning Network.
+
+## Releases and release candidates
+
+*New releases and release candidates for popular Bitcoin infrastructure
+projects.  Please consider upgrading to new releases or helping to test
+release candidates.*
+
+- [HWI 3.1.0][] is a release of the next version of this package
+  providing a common interface to multiple different hardware signing
+  devices.  This release adds support for the Trezor Safe 5 and makes
+  several other improvements and bug fixes.
+
+- [Core Lightning 24.08.1][] is a maintenance release that fixes crashes
+  and other bugs discovered in the recent 24.08 release.
+
+- [BDK 1.0.0-beta.4][] is a release candidate for this library for
+  building wallets and other Bitcoin-enabled applications.  The original
+  `bdk` Rust crate has been renamed to `bdk_wallet` and lower layer
+  modules have been extracted into their own crates, including
+  `bdk_chain`, `bdk_electrum`, `bdk_esplora`, and `bdk_bitcoind_rpc`.
+  The `bdk_wallet` crate "is the first version to offer a stable 1.0.0 API."
+
+- [Bitcoin Core 28.0rc2][] is a release candidate for the next major
+  version of the predominant full node implementation.  A [testing
+  guide][bcc testing] is available.
+
+## Notable code and documentation changes
+
+_Notable recent changes in [Bitcoin Core][bitcoin core repo], [Core
+Lightning][core lightning repo], [Eclair][eclair repo], [LDK][ldk repo],
+[LND][lnd repo], [libsecp256k1][libsecp256k1 repo], [Hardware Wallet
+Interface (HWI)][hwi repo], [Rust Bitcoin][rust bitcoin repo], [BTCPay
+Server][btcpay server repo], [BDK][bdk repo], [Bitcoin Improvement
+Proposals (BIPs)][bips repo], [Lightning BOLTs][bolts repo],
+[Lightning BLIPs][blips repo], [Bitcoin Inquisition][bitcoin inquisition
+repo], and [BINANAs][binana repo]._
+
+_Note: the commits to Bitcoin Core mentioned below apply to its master
+development branch, so those changes will likely not be released until
+about six months after the release of the upcoming version 28._
+
+- [Bitcoin Core #28358][] drops the `dbcache` limit because the previous 16 GB
+  limit was no longer sufficient to complete an Initial Block Download (IBD)
+  without flushing the UTXO set from RAM to disk, which can
+  [provide][lopp cache] about a 25% speed up. It was decided to remove the
+  limit rather than raise it because there was no optimal value
+  that would be future-proof and to give users complete flexibility.
+
+- [Bitcoin Core #30286][] optimizes the candidate search algorithm used in
+  cluster linearizations, based on the framework laid out in Section 2 of
+  this [Delving Bitcoin post][delving cluster], but with some modifications.
+  These optimizations minimize iterations to improve linearization performance,
+  but may increase startup and per-iteration costs. This is part of the [cluster
+  mempool][topic cluster mempool] project. See Newsletter [#315][news315
+  cluster].
+
+- [Bitcoin Core #30807][] changes the signaling of an [assumeUTXO][topic
+  assumeutxo] node that is syncing the background chain from `NODE_NETWORK` to
+  `NODE_NETWORK_LIMITED` so that peer nodes don’t request blocks older than about a week from it. This
+  fixes a bug where a peer would request a historical block and get no response,
+  causing it to disconnect from the assumeUTXO node.
+
+- [LND #8981][] refactors the `paymentDescriptor` type to only use it within
+  the `lnwallet` package. This is to later replace `paymentDescriptor` with a
+  new structure called `LogUpdate` to simplify how updates are logged and
+  handled, as part of a series of PRs implementing dynamic commitments, a type
+  of [channel commitment upgrade][topic channel commitment upgrades].
+
+- [LDK #3140][] adds support for paying static [BOLT12][topic offers] invoices
+  to send [async payments][topic async payments] as an always online sender as
+  defined in [BOLTs #1149][], but without including the invoice request in the
+  payment [onion message][topic onion messages]. Sending as an often offline
+  sender or receiving async payments is not yet possible, so the flow cannot yet
+  be tested end-to-end.
+
+- [LDK #3163][] updates the [offers][topic offers] message flow by introducing a
+  `reply_path` in BOLT12 invoices. This allows the payer to send the error
+  message back to the payee in case of an invoice error.
+
+- [LDK #3010][] adds functionality for a node to retry sending an invoice
+  request to an [offer][topic offers] reply path if it hasn't yet received the
+  corresponding invoice.  Previously, if an invoice request message on a single
+  reply path offer failed due to network disconnection, it wasn't retried.
+
+- [BDK #1581][] introduces changes to the [coin selection][topic coin selection]
+  algorithm by allowing for a customizable fallback algorithm in the
+  `BranchAndBoundCoinSelection` strategy. The signature of the `coin_select`
+  method is updated to allow a random number generator to be passed directly to
+  the coin selection algorithm. This PR also includes additional refactorings,
+  internal fallback handling, and simplification of error handling.
+
+- [BDK #1561][] removes the `bdk_hwi` crate from the project, to simplify
+  dependencies and CI. The `bdk_hwi` crate contained `HWISigner`, which has now
+  been moved to the `rust_hwi` project.
+
+{% assign four_days_after_posting = page.date | date: "%s" | plus: 345600 | date: "%Y-%m-%d 14:30" %}
+{% include snippets/recap-ad.md when=four_days_after_posting %}
+{% include references.md %}
+{% include linkers/issues.md v=2 issues="28358,30286,30807,8981,3140,3163,3010,1581,1561,1149" %}
+[BDK 1.0.0-beta.4]: https://github.com/bitcoindevkit/bdk/releases/tag/v1.0.0-beta.4
+[bitcoin core 28.0rc2]: https://bitcoincore.org/bin/bitcoin-core-28.0/
+[bcc testing]: https://github.com/bitcoin-core/bitcoin-devwiki/wiki/28.0-Release-Candidate-Testing-Guide
+[halseth utxozk]: https://delvingbitcoin.org/t/proving-utxo-set-inclusion-in-zero-knowledge/1142/
+[schroder lnoff]: https://delvingbitcoin.org/t/privately-sending-payments-while-offline-with-bolt12/1134/
+[virtu seed]: https://delvingbitcoin.org/t/hardcoded-seeds-dns-seeds-and-darknet-nodes/1123
+[news303 aut-ct]: /en/newsletters/2024/05/17/#anonymous-usage-tokens
+[nfc]: https://en.wikipedia.org/wiki/Near-field_communication
+[zmn lnoff]: https://delvingbitcoin.org/t/privately-sending-payments-while-offline-with-bolt12/1134/2
+[t-bast lnoff]: https://delvingbitcoin.org/t/privately-sending-payments-while-offline-with-bolt12/1134/4
+[news271 noderc]: /en/newsletters/2023/10/04/#secure-remote-control-of-ln-nodes
+[hwi 3.1.0]: https://github.com/bitcoin-core/HWI/releases/tag/3.1.0
+[core lightning 24.08.1]: https://github.com/ElementsProject/lightning/releases/tag/v24.08.1
+[delving cluster]: https://delvingbitcoin.org/t/how-to-linearize-your-cluster/303#h-2-finding-high-feerate-subsets-5
+[lopp cache]: https://github.com/bitcoin/bitcoin/pull/28358#issuecomment-2186630679
+[news315 cluster]: /en/newsletters/2024/08/02/#bitcoin-core-30126
+[strike blog]: https://strike.me/blog/bolt12-offers/
+[bitbox blog sp]: https://bitbox.swiss/blog/understanding-silent-payments-part-one/
+[bitbox blog pr]: https://bitbox.swiss/blog/using-payment-requests-to-securely-send-bitcoin-to-an-exchange/
+[mempool github 3.0.0]: https://github.com/mempool/mempool/releases/tag/v3.0.0
+[zeus blog 0.9.0]: https://blog.zeusln.com/new-release-zeus-v0-9-0/
+[live wallet github 0.7.0]: https://github.com/Jwyman328/LiveWallet/releases/tag/0.7.0
+[consolidate info]: https://en.bitcoin.it/wiki/Techniques_to_reduce_transaction_fees#Consolidation
+[bisq github v2.1.0]: https://github.com/bisq-network/bisq2/releases/tag/v2.1.0

_topics/en/anonymity-networks.md

@@ -112,6 +112,9 @@ optech_mentions:
   - title: "Bitcoin Core #29200 allows the I2P to use connections encrypted with both ECIES-X25519 and ElGamal"
     url: /en/newsletters/2024/01/17/#bitcoin-core-29200
 
+  - title: "DNS seeding for nodes on anonymity networks"
+    url: /en/newsletters/2024/09/20/#dns-seeding-for-non-ip-addresses
+
 ## Optional.  Same format as "primary_sources" above
 see_also:
   - title: Dandelion

_topics/en/assumeutxo.md

@@ -70,6 +70,9 @@ optech_mentions:
   - title: "Bitcoin Core #28553 adds assumeUTXO snapshot parameters for mainnet block 840,000"
     url: /en/newsletters/2024/08/23/#bitcoin-core-28553
 
+  - title: "Bitcoin Core #30807 has assumeUTXO nodes during background sync signal NODE_NETWORK_LIMITED"
+    url: /en/newsletters/2024/09/20/#bitcoin-core-30807
+
 ## Optional.  Same format as "primary_sources" above
 see_also:
   - title: "Bitcoin Core issue #15605: AssumeUTXO discussion"

_topics/en/async-payments.md

@@ -54,6 +54,12 @@ optech_mentions:
   - title: "LDK #3125 introduces support for encoding and parsing messages needed for async payments"
     url: /en/newsletters/2024/07/05/#ldk-3125
 
+  - title: "Eclair #2865 enables waking up a disconnected mobile peer for async payments or onion messages"
+    url: /en/newsletters/2024/09/06/#eclair-2865
+
+  - title: "LDK #3140 adds support for paying static BOLT12 invoices to send async payments"
+    url: /en/newsletters/2024/09/20/#ldk-3140
+
 ## Optional.  Same format as "primary_sources" above
 see_also:
   - title: Trampoline payments

_topics/en/channel-announcements.md

@@ -41,6 +41,9 @@ optech_mentions:
   - title: New anonymous usage tokens proposed that could be used to improve channel announcement privacy
     url: /en/newsletters/2024/05/17/#anonymous-usage-tokens
 
+  - title: "Proving UTXO set inclusion in zero knowledge for more private channel announcement messages"
+    url: /en/newsletters/2024/09/20/#proving-utxo-set-inclusion-in-zero-knowledge
+
 ## Optional.  Same format as "primary_sources" above
 # see_also:
 #   - title:

_topics/en/cluster-mempool.md

@@ -82,6 +82,9 @@ optech_mentions:
   - title: "Bitcoin Core #30285 adds two key cluster linearization algorithms"
     url: /en/newsletters/2024/08/09/#bitcoin-core-30285
 
+  - title: "Bitcoin Core #30286 optimizes the candidate search algorithm used in cluster linearizations"
+    url: /en/newsletters/2024/09/20/#bitcoin-core-30286
+
 ## Optional.  Same format as "primary_sources" above
 see_also:
   - title: Package relay

_topics/en/coin-selection.md

@@ -87,6 +87,9 @@ optech_mentions:
   - title: "Effect of SubtractFeeFromOutputs on coin selection in Bitcoin Core"
     url: /en/newsletters/2024/06/28/#how-does-subtractfeefrom-work
 
+  - title: "BDK #1581 allows a customizable fallback algorithm in branch-and-bound coin selection"
+    url: /en/newsletters/2024/09/20/#bdk-1581
+
 ## Optional.  Same format as "primary_sources" above
 see_also:
   - title: An Evaluation of Coin Selection Strategies

_topics/en/consensus-cleanup-soft-fork.md

@@ -50,6 +50,9 @@ optech_mentions:
   - title: Notes from Bitcoin developer discussion about consensus cleanup
     url: /en/newsletters/2024/05/01/#coredev-tech-berlin-event
 
+  - title: "Discussion about mitigating merkle tree vulnerabilities in the proposed consensus cleanup soft fork"
+    url: /en/newsletters/2024/09/06/#mitigating-merkle-tree-vulnerabilities
+
 ## Optional.  Same format as "primary_sources" above
 see_also:
  - title: Soft fork activation

_topics/en/discreet-log-contracts.md

@@ -77,6 +77,9 @@ optech_mentions:
   - title: "Wallet 10101 allows pooling funds between LN and DLCs"
     url: /en/newsletters/2023/07/19/#wallet-10101-beta-testing-pooling-funds-between-ln-and-dlcs
 
+  - title: "Lava Loans: DLC-based loan contract execution"
+    url: /en/newsletters/2024/09/13/#dlc-based-loan-contract-execution
+
 ## Optional.  Same format as "primary_sources" above
 see_also:
   - title: Signature adaptors

_topics/en/fee-estimation.md

@@ -56,6 +56,9 @@ optech_mentions:
   - title: "Bitcoin Core #30275 updates `estimatesmartfee` RPC default from conservative to economical"
     url: /en/newsletters/2024/08/02/#bitcoin-core-30275
 
+  - title: "LDK #3268 adds a more conservative fee estimation method for dust calculations"
+    url: /en/newsletters/2024/09/06/#ldk-3268
+
 ## Optional.  Same format as "primary_sources" above
 see_also:
   - title: Coin selection

_topics/en/merkle-tree-vulnerabilities.md

@@ -56,6 +56,9 @@ optech_mentions:
   - title: "LDK #3215 rejects transactions less than 65 bytes to protect against merkle tree vulnerabilites"
     url: /en/newsletters/2024/08/16/#ldk-3215
 
+  - title: "Discussion about mitigating merkle tree vulnerabilities"
+    url: /en/newsletters/2024/09/06/#mitigating-merkle-tree-vulnerabilities
+
 ## Optional.  Same format as "primary_sources" above
 see_also:
   - title: CVEs

_topics/en/offers.md

@@ -121,6 +121,9 @@ optech_mentions:
   - title: "Proposal to allow opt-in identification and authentication of LN payers when using offers"
     url: /en/newsletters/2024/08/16/#optional-identification-and-authentication-of-ln-payers
 
+  - title: "LDK #3140 adds support for paying static BOLT12 invoices to send async payments"
+    url: /en/newsletters/2024/09/20/#ldk-3140
+
 ## Optional.  Same format as "primary_sources" above
 see_also:
   - title: Blinded paths

_topics/en/onion-messages.md

@@ -95,6 +95,9 @@ optech_mentions:
   - title: "Discussion of onion denial-of-service risk with proposed mitigations"
     url: /en/newsletters/2024/08/16/#onion-message-dos-risk-discussion
 
+  - title: "Eclair #2865 enables waking up a disconnected mobile peer for async payments or onion messages"
+    url: /en/newsletters/2024/09/06/#eclair-2865
+
 ## Optional.  Same format as "primary_sources" above
 see_also:
   - title: Blinded paths

_topics/en/op_cat.md

@@ -66,6 +66,9 @@ optech_mentions:
   - title: "`OP_CAT` script to validate proof of work"
     url: /en/newsletters/2024/06/07/#op-cat-script-to-validate-proof-of-work
 
+  - title: "`OP_CAT` research fund"
+    url: /en/newsletters/2024/09/06/#op-cat-research-fund
+
 ## Optional.  Same format as "primary_sources" above
 see_also:
   - title: OP_CHECKSIGFROMSTACK

_topics/en/output-script-descriptors.md

@@ -179,6 +179,9 @@ optech_mentions:
   - title: "BIPs 328, 390, and 373 added with specifications for MuSig2 key derivation, descriptors, and PSBTs"
     url: /en/newsletters/2024/07/05/#bips-1540
 
+  - title: "Bitcoin Core #22838 implements multiple derivation path descriptors (BIP389)"
+    url: /en/newsletters/2024/09/06/#bitcoin-core-22838
+
 ## Optional.  Same format as "primary_sources" above
 see_also:
   - title: Miniscript