A rust library to encode descriptors with a 30-40% size reduction

These include inconsistencies in the use of certain characters and formats, challenges in comparing descriptor strings or using a descriptor checksum as an identifier, and the possibility of creating syntactically valid but semantically invalid descriptors. Such issues underscore the need for a standardized deterministic encoding method. A potential solution explored involves splitting the descriptor into template and payload parts, aiming to address these ambiguities while enhancing usability and reliability.

An innovative library has been developed to compactly encode Bitcoin descriptors, motivated by the desire to reduce QR code sizes for wallet transactions. This solution, which originated from comments on a Bitcoin pull request, utilizes tag-based and variable-length encoding to support diverse descriptor types, including those incorporating private keys. By departing from traditional encoding methods like bech32 and base58, this approach achieves a significant reduction in descriptor size, estimated at 30-40%. This not only improves QR code reliability but also fits within NFC byte limits, facilitating smoother interactions with hardware wallets.

The encoder distinguishes itself through a dual-component system consisting of a structural template and a data payload. The template captures the descriptor's logical structure via single-byte tags that denote script components and other structural details. Meanwhile, the payload contains raw data values such as keys, fingerprints, and timelock values. This separation of elements ensures efficient encoding and decoding, making the library particularly useful for sharing multisig configurations, enhancing wallet coordination protocols, and optimizing storage in memory-constrained environments.

Future enhancements will focus on integrating this encoder within the descriptor-encrypt tool and extending its applicability to new miniscript operators and descriptor types. The project is accessible online, providing both a GitHub repository and detailed documentation for interested users and developers. The GitHub page can be found at https://github.com/joshdoman/descriptor-codec, and the documentation is available at https://docs.rs/descriptor-codec/latest/descriptor_codec. This development represents a significant step forward in the practical management and transfer of Bitcoin descriptors, aiming to streamline processes and enhance security for users across the ecosystem.