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CH05::style: s/BIP-/BIP/ for compatibility with many modern docs

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David A. Harding 2023-02-11 08:26:22 -10:00
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@ -123,14 +123,14 @@ all the user's keys between different wallet implementations.
image::images/mbc2_0502.png["Deterministic Wallet"] image::images/mbc2_0502.png["Deterministic Wallet"]
[[hd_wallets]] [[hd_wallets]]
==== HD Wallets (BIP-32/BIP-44) ==== HD Wallets (BIP32/BIP44)
((("wallets", "types of", "hierarchical deterministic (HD) ((("wallets", "types of", "hierarchical deterministic (HD)
wallets")))((("hierarchical deterministic (HD) wallets")))((("bitcoin wallets")))((("hierarchical deterministic (HD) wallets")))((("bitcoin
improvement proposals", "Hierarchical Deterministic Wallets improvement proposals", "Hierarchical Deterministic Wallets
(BIP-32/BIP-44)")))Deterministic wallets were developed to make it easy (BIP32/BIP44)")))Deterministic wallets were developed to make it easy
to derive many keys from a single "seed." The most advanced form of to derive many keys from a single "seed." The most advanced form of
deterministic wallets is the HD wallet defined by the BIP-32 standard. deterministic wallets is the HD wallet defined by the BIP32 standard.
HD wallets contain keys derived in a tree structure, such that a parent HD wallets contain keys derived in a tree structure, such that a parent
key can derive a sequence of children keys, each of which can derive a key can derive a sequence of children keys, each of which can derive a
sequence of grandchildren keys, and so on, to an infinite depth. This sequence of grandchildren keys, and so on, to an infinite depth. This
@ -156,15 +156,15 @@ transaction. The public keys do not need to be preloaded or derived in
advance, yet the server doesn't have the private keys that can spend the advance, yet the server doesn't have the private keys that can spend the
funds. funds.
==== Seeds and Mnemonic Codes (BIP-39) ==== Seeds and Mnemonic Codes (BIP39)
((("wallets", "technology of", "seeds and mnemonic codes")))((("mnemonic ((("wallets", "technology of", "seeds and mnemonic codes")))((("mnemonic
code words")))((("bitcoin improvement proposals", "Mnemonic Code Words code words")))((("bitcoin improvement proposals", "Mnemonic Code Words
(BIP-39)")))HD wallets are a very powerful mechanism for managing many (BIP39)")))HD wallets are a very powerful mechanism for managing many
keys and addresses. They are even more useful if they are combined with keys and addresses. They are even more useful if they are combined with
a standardized way of creating seeds from a sequence of English words a standardized way of creating seeds from a sequence of English words
that are easy to transcribe, export, and import across wallets. This is that are easy to transcribe, export, and import across wallets. This is
known as a _mnemonic_ and the standard is defined by BIP-39. Today, most known as a _mnemonic_ and the standard is defined by BIP39. Today, most
bitcoin wallets (as well as wallets for other cryptocurrencies) use this bitcoin wallets (as well as wallets for other cryptocurrencies) use this
standard and can import and export seeds for backup and recovery using standard and can import and export seeds for backup and recovery using
interoperable mnemonics. interoperable mnemonics.
@ -187,15 +187,15 @@ garbage claim echo media make crunch
==== Wallet Best Practices ==== Wallet Best Practices
((("wallets", "best practices for")))((("bitcoin improvement proposals", ((("wallets", "best practices for")))((("bitcoin improvement proposals",
"Multipurpose HD Wallet Structure (BIP-43)")))As bitcoin wallet "Multipurpose HD Wallet Structure (BIP43)")))As bitcoin wallet
technology has matured, certain common industry standards have emerged technology has matured, certain common industry standards have emerged
that make bitcoin wallets broadly interoperable, easy to use, secure, that make bitcoin wallets broadly interoperable, easy to use, secure,
and flexible. These common standards are: and flexible. These common standards are:
* Mnemonic code words, based on BIP-39 * Mnemonic code words, based on BIP39
* HD wallets, based on BIP-32 * HD wallets, based on BIP32
* Multipurpose HD wallet structure, based on BIP-43 * Multipurpose HD wallet structure, based on BIP43
* Multicurrency and multiaccount wallets, based on BIP-44 * Multicurrency and multiaccount wallets, based on BIP44
These standards may change or may become obsolete by future These standards may change or may become obsolete by future
developments, but for now they form a set of interlocking technologies developments, but for now they form a set of interlocking technologies
@ -218,7 +218,7 @@ The following sections examine each of these technologies in detail.
==== ====
If you are implementing a bitcoin wallet, it should be built as a HD If you are implementing a bitcoin wallet, it should be built as a HD
wallet, with a seed encoded as mnemonic code for backup, following the wallet, with a seed encoded as mnemonic code for backup, following the
BIP-32, BIP-39, BIP-43, and BIP-44 standards, as described in the BIP32, BIP39, BIP43, and BIP44 standards, as described in the
following sections. following sections.
==== ====
@ -293,11 +293,11 @@ Let's now examine each of the important industry standards that are used
by many bitcoin wallets in detail. by many bitcoin wallets in detail.
[[mnemonic_code_words]] [[mnemonic_code_words]]
==== Mnemonic Code Words (BIP-39) ==== Mnemonic Code Words (BIP39)
((("wallets", "technology of", "mnemonic code words")))((("mnemonic code ((("wallets", "technology of", "mnemonic code words")))((("mnemonic code
words", id="mnemonic05")))((("bitcoin improvement proposals", "Mnemonic words", id="mnemonic05")))((("bitcoin improvement proposals", "Mnemonic
Code Words (BIP-39)", id="BIP3905")))Mnemonic code words are word Code Words (BIP39)", id="BIP3905")))Mnemonic code words are word
sequences that represent (encode) a random number used as a seed to sequences that represent (encode) a random number used as a seed to
derive a deterministic wallet. The sequence of words is sufficient to derive a deterministic wallet. The sequence of words is sufficient to
re-create the seed and from there re-create the wallet and all the re-create the seed and from there re-create the wallet and all the
@ -319,17 +319,17 @@ important difference makes mnemonic words much more secure, because
humans are very poor sources of randomness. humans are very poor sources of randomness.
==== ====
Mnemonic codes are defined in BIP-39 (see <<appdxbitcoinimpproposals>>). Mnemonic codes are defined in BIP39 (see <<appdxbitcoinimpproposals>>).
Note that BIP-39 is one implementation of a mnemonic code standard. Note that BIP39 is one implementation of a mnemonic code standard.
((("Electrum wallet", seealso="wallets")))There is a different standard, ((("Electrum wallet", seealso="wallets")))There is a different standard,
with a different set of words, used by the Electrum wallet and predating with a different set of words, used by the Electrum wallet and predating
BIP-39. BIP-39 was proposed by the company behind the Trezor hardware BIP39. BIP39 was proposed by the company behind the Trezor hardware
wallet and is incompatible with Electrum's implementation. However, wallet and is incompatible with Electrum's implementation. However,
BIP-39 has now achieved broad industry support across dozens of BIP39 has now achieved broad industry support across dozens of
interoperable implementations and should be considered the de facto interoperable implementations and should be considered the de facto
industry standard. industry standard.
BIP-39 defines the creation of a mnemonic code and seed, which we BIP39 defines the creation of a mnemonic code and seed, which we
describe here in nine steps. For clarity, the process is split into two describe here in nine steps. For clarity, the process is split into two
parts: steps 1 through 6 are shown in <<generating_mnemonic_words>> and parts: steps 1 through 6 are shown in <<generating_mnemonic_words>> and
steps 7 through 9 are shown in <<mnemonic_to_seed>>. steps 7 through 9 are shown in <<mnemonic_to_seed>>.
@ -338,7 +338,7 @@ steps 7 through 9 are shown in <<mnemonic_to_seed>>.
===== Generating mnemonic words ===== Generating mnemonic words
Mnemonic words are generated automatically by the wallet using the Mnemonic words are generated automatically by the wallet using the
standardized process defined in BIP-39. The wallet starts from a source standardized process defined in BIP39. The wallet starts from a source
of entropy, adds a checksum, and then maps the entropy to a word list: of entropy, adds a checksum, and then maps the entropy to a word list:
1. Create a random sequence (entropy) of 128 to 256 bits. 1. Create a random sequence (entropy) of 128 to 256 bits.
@ -390,7 +390,7 @@ a deterministic wallet and derive its keys.
((("salts")))((("passphrases")))The key-stretching function takes two ((("salts")))((("passphrases")))The key-stretching function takes two
parameters: the mnemonic and a _salt_. The purpose of a salt in a parameters: the mnemonic and a _salt_. The purpose of a salt in a
key-stretching function is to make it difficult to build a lookup table key-stretching function is to make it difficult to build a lookup table
enabling a brute-force attack. In the BIP-39 standard, the salt has enabling a brute-force attack. In the BIP39 standard, the salt has
another purpose&#x2014;it allows the introduction of a passphrase that another purpose&#x2014;it allows the introduction of a passphrase that
serves as an additional security factor protecting the seed, as we will serves as an additional security factor protecting the seed, as we will
describe in more detail in <<mnemonic_passphrase>>. describe in more detail in <<mnemonic_passphrase>>.
@ -474,9 +474,9 @@ luggage oxygen faint major edit measure invite love trap field dilemma oblige+
|======= |=======
[[mnemonic_passphrase]] [[mnemonic_passphrase]]
===== Optional passphrase in BIP-39 ===== Optional passphrase in BIP39
((("passphrases")))The BIP-39 standard allows the use of an optional ((("passphrases")))The BIP39 standard allows the use of an optional
passphrase in the derivation of the seed. If no passphrase is used, the passphrase in the derivation of the seed. If no passphrase is used, the
mnemonic is stretched with a salt consisting of the constant string mnemonic is stretched with a salt consisting of the constant string
+"mnemonic"+, producing a specific 512-bit seed from any given mnemonic. +"mnemonic"+, producing a specific 512-bit seed from any given mnemonic.
@ -491,7 +491,7 @@ is in use.
[TIP] [TIP]
==== ====
There are no "wrong" passphrases in BIP-39. Every passphrase leads to There are no "wrong" passphrases in BIP39. Every passphrase leads to
some wallet, which unless previously used will be empty. some wallet, which unless previously used will be empty.
==== ====
@ -518,28 +518,28 @@ her family to recover the cryptocurrency estate.
===== Working with mnemonic codes ===== Working with mnemonic codes
BIP-39 is implemented as a library in many different programming BIP39 is implemented as a library in many different programming
languages: languages:
https://github.com/trezor/python-mnemonic[python-mnemonic]:: The https://github.com/trezor/python-mnemonic[python-mnemonic]:: The
reference implementation of the standard by the SatoshiLabs team that reference implementation of the standard by the SatoshiLabs team that
proposed BIP-39, in Python proposed BIP39, in Python
https://github.com/bitcoinjs/bip39[bitcoinjs/bip39]:: An implementation https://github.com/bitcoinjs/bip39[bitcoinjs/bip39]:: An implementation
of BIP-39, as part of the popular bitcoinJS framework, in JavaScript of BIP39, as part of the popular bitcoinJS framework, in JavaScript
https://github.com/libbitcoin/libbitcoin/blob/master/src/wallet/mnemonic.cpp[libbitcoin/mnemonic]:: https://github.com/libbitcoin/libbitcoin/blob/master/src/wallet/mnemonic.cpp[libbitcoin/mnemonic]::
An implementation of BIP-39, as part of the popular Libbitcoin An implementation of BIP39, as part of the popular Libbitcoin
framework, in pass:[<span class="keep-together">C++</span>] framework, in pass:[<span class="keep-together">C++</span>]
There is also a BIP-39 generator implemented in a standalone webpage, There is also a BIP39 generator implemented in a standalone webpage,
which is extremely useful for testing and experimentation. which is extremely useful for testing and experimentation.
<<a_bip39_generator_as_a_standalone_web_page>> shows a standalone web <<a_bip39_generator_as_a_standalone_web_page>> shows a standalone web
page that generates mnemonics, seeds, and extended private keys. page that generates mnemonics, seeds, and extended private keys.
[[a_bip39_generator_as_a_standalone_web_page]] [[a_bip39_generator_as_a_standalone_web_page]]
.A BIP-39 generator as a standalone web page .A BIP39 generator as a standalone web page
image::images/mbc2_0508.png["BIP-39 generator web-page"] image::images/mbc2_0508.png["BIP39 generator web-page"]
((("", startref="mnemonic05")))((("", startref="BIP3905")))The page ((("", startref="mnemonic05")))((("", startref="BIP3905")))The page
(https://iancoleman.github.io/bip39/) can be used offline in a browser, (https://iancoleman.github.io/bip39/) can be used offline in a browser,
@ -683,7 +683,7 @@ structure. Sharing an extended key gives access to the entire branch.
==== ====
Extended keys are encoded using Base58Check, to easily export and import Extended keys are encoded using Base58Check, to easily export and import
between different BIP-32&#x2013;compatible wallets. The Base58Check between different BIP32&#x2013;compatible wallets. The Base58Check
coding for extended keys uses a special version number that results in coding for extended keys uses a special version number that results in
the prefix "xprv" and "xpub" when encoded in Base58 characters to make the prefix "xprv" and "xpub" when encoded in Base58 characters to make
them easily recognizable. Because the extended key is 512 or 513 bits, them easily recognizable. Because the extended key is 512 or 513 bits,
@ -904,21 +904,21 @@ because the possibilities for internal organization into branches and
subbranches are endless. subbranches are endless.
Two BIPs offer a solution to this complexity by creating some proposed Two BIPs offer a solution to this complexity by creating some proposed
standards for the structure of HD wallet trees. BIP-43 proposes the use standards for the structure of HD wallet trees. BIP43 proposes the use
of the first hardened child index as a special identifier that signifies of the first hardened child index as a special identifier that signifies
the "purpose" of the tree structure. Based on BIP-43, an HD wallet the "purpose" of the tree structure. Based on BIP43, an HD wallet
should use only one level-1 branch of the tree, with the index number should use only one level-1 branch of the tree, with the index number
identifying the structure and namespace of the rest of the tree by identifying the structure and namespace of the rest of the tree by
defining its purpose. For example, an HD wallet using only branch defining its purpose. For example, an HD wallet using only branch
m/i++&#x27;++/ is intended to signify a specific purpose and that m/i++&#x27;++/ is intended to signify a specific purpose and that
purpose is identified by index number "i." purpose is identified by index number "i."
Extending that specification, BIP-44 proposes a multiaccount structure Extending that specification, BIP44 proposes a multiaccount structure
as "purpose" number +44'+ under BIP-43. All HD wallets following the as "purpose" number +44'+ under BIP43. All HD wallets following the
BIP-44 structure are identified by the fact that they only used one BIP44 structure are identified by the fact that they only used one
branch of the tree: m/44'/. branch of the tree: m/44'/.
BIP-44 specifies the structure as consisting of five predefined tree levels: BIP44 specifies the structure as consisting of five predefined tree levels:
----- -----
m / purpose' / coin_type' / account' / change / address_index m / purpose' / coin_type' / account' / change / address_index
@ -951,7 +951,7 @@ would be M/44++&#x27;++/0++&#x27;++/0++&#x27;++/0/2. <<table_4-9>> shows
a few more examples. a few more examples.
[[table_4-9]] [[table_4-9]]
.BIP-44 HD wallet structure examples .BIP44 HD wallet structure examples
[options="header"] [options="header"]
|======= |=======
|HD path | Key described |HD path | Key described