Proposal discussion: BIP39 native-language display wordlists

The email from Daniel Osemberg touches upon a significant proposal regarding the BIP39 seed phrase translation across different languages. The idea is to enable the conversion of a BIP39 seed phrase to and from various languages while ensuring it can be reverted back to English if necessary for compatibility with English-only BIP39 wallets. This concept arises from the limitations present in the current BIP39 implementation where a seed generates a different master key depending on the language used to encode the source entropy. This design flaw has led to reduced compatibility between different implementations and encouraged uniformity in language use to ensure maximum compatibility.

Daniel raises concerns about potential issues that might arise with the introduction of this new translation mechanism. Specifically, he questions the process of mapping and using the PBKDF2 algorithm on translated seed phrases. He points out the need for a clear distinction between a "locale-mapped seed phrase" under the new specification and a legacy seed phrase in its original language format. This clarity is crucial to avoid ambiguity which could potentially result in misderived keys and consequently, the loss of funds. The underlying worry is whether such an innovation, despite its theoretical benefits, might introduce confusion in practical scenarios.

Overall, the proposal aims to rectify a foundational oversight in the BIP39 standard by enhancing cross-language compatibility which could simplify the usage of digital wallets globally. However, careful consideration and possibly further development are required to address the highlighted risks and ensure that the solution does not lead to more complex problems than those it seeks to solve.