delvingbitcoin

Unspendable keys in descriptors

Unspendable keys in descriptors

Original Postby josibake

Posted on: December 19, 2023 15:09 UTC

Understanding the implications of revealing script-only taproot outputs is a nuanced aspect of Bitcoin protocol discussions.

The concerns stem from the potential drawbacks of exposing certain transaction details to the public. Although there's an intuitive sense that keeping this information private enhances security, pinpointing concrete examples can be challenging.

Exposing that a transaction was a script-only spend could potentially lead to privacy and security issues. The knowledge that a specific output was script-only could give observers clues about the spending conditions or the parties involved, which might not otherwise be apparent. This could inadvertently reveal strategic financial information or patterns of behavior to potential attackers or surveillance entities. Such transparency might also limit the fungibility of bitcoins, as script-only spends could be treated differently by some users or services if they are perceived to carry higher risk or come from less desirable sources (such as coins with a history of being involved in complex scripts).

Moreover, by making this information public, it could become easier for an observer to identify and discriminate against certain types of transactions or users. For example, if it becomes known that a particular type of script is commonly used by a certain organization or for a specific purpose, then transactions with script-only spends could be censored or scrutinized more heavily by those wishing to interfere with the organization's activities.

In summary, revealing that a transaction is a script-only spend could compromise privacy and security by providing additional information about transaction conditions and participants. It also raises concerns about the potential discrimination against specific transaction types, impacting the fungibility and equitable treatment of bitcoins within the network. These considerations reflect the delicate balance between transparency and privacy in the realm of digital currencies and highlight the need for careful thought when proposing changes to established protocols like Bitcoin's BIP352.