Avoiding xpub+derivation reuse across wallets, in a UX-friendly manner

The discussion revolves around the quest for an optimal method to handle unhardened paths in a manner that balances usability with privacy. The current suggestion on the table involves utilizing a combination of a "standard" export path integrated with additional layers of randomness, specifically by appending random values to a predefined derivation path structure (e.g., m/48'/0'/0'/2'/xpub/[RANDOM]/[RANDOM]/[RANDOM]/[..]). This approach aims to preserve user privacy without compromising the functionality or accessibility when switching between different software solutions.

However, there are reservations about the feasibility of this solution with current hardware signers, raising concerns about compatibility and support. Furthermore, the appropriate depth of randomness necessary to ensure adequate privacy protection remains an open question. It's highlighted that relying solely on unix timestamps or date/time for generating unhardened paths is not advisable due to the limited variability they offer, which could potentially compromise privacy. Such methods would still necessitate an overlay of randomness to achieve the desired level of security and privacy.

This conversation underscores the intricate balance between enhancing privacy through complexity in path structures and maintaining a user-friendly experience that does not alienate or confuse users. The challenge lies in finding a middle ground that offers robust privacy protections without introducing unnecessary hurdles for users, especially in terms of compatibility and ease of use across different platforms and software.