Taproot Integration Guide

This document provides a comprehensive guide for integrating and leveraging Taproot functionality within the Anya Bitcoin implementation.

Overview

Taproot (BIP341) represents one of the most significant upgrades to the Bitcoin protocol, bringing enhanced privacy, scalability, and smart contract capabilities while maintaining Bitcoin's core principles of decentralization and security.

Key Taproot Components

1. Schnorr Signatures (BIP340)

Schnorr signatures offer several benefits over ECDSA:

  • Linearity properties enabling key aggregation
  • Simpler cryptographic security proof
  • Batch verification efficiency
  • Non-malleability
/// Create a Schnorr signature
pub fn create_schnorr_signature(
    message: &[u8],
    private_key: &SecretKey,
    merkle_root: Option<&[u8; 32]>,
) -> Result<SchnorrSignature, TaprootError> {
    let secp = Secp256k1::new();
    let keypair = KeyPair::from_secret_key(&secp, private_key);

    // Apply taptweak if merkle root is provided
    let keypair = if let Some(merkle_root) = merkle_root {
        let (_, tweaked_seckey) = keypair.tap_tweak(&secp, TapTweakHash::from_slice(merkle_root)?);
        tweaked_seckey
    } else {
        keypair
    };

    // Create message hash
    let msg_hash = bitcoin::hashes::sha256::Hash::hash(message);
    let msg = Message::from_digest(msg_hash.to_byte_array());

    // Generate signature
    let sig = secp.sign_schnorr(&msg, &keypair);

    Ok(sig)
}

2. MAST (Merkleized Alternative Script Trees)

MAST allows complex scripts to be organized in a tree structure where only the executed path needs to be revealed:

/// Create a Taproot script tree with multiple spending conditions
pub fn create_taproot_script_tree(
    internal_key: &XOnlyPublicKey,
    script_branches: &[(Script, u8, u32)], // (script, leaf_version, relative_weight)
) -> Result<TaprootScriptTree, TaprootError> {
    let mut builder = taproot::TaprootBuilder::new();

    // Add all script branches with their weights
    for (script, leaf_version, weight) in script_branches {
        builder = builder.add_leaf_with_ver(*weight, script.clone(), *leaf_version)?;
    }

    // Finalize the tree with the internal key
    let spend_info = builder.finalize(&Secp256k1::new(), *internal_key)?;

    Ok(TaprootScriptTree {
        output_key: spend_info.output_key(),
        merkle_root: spend_info.merkle_root(),
        control_block_map: spend_info
            .control_blocks()
            .iter()
            .map(|(script, control_block)| (script.clone(), control_block.clone()))
            .collect(),
    })
}

3. MuSig2 Key Aggregation

MuSig2 enables multiple parties to create a single signature that validates against a single aggregated public key:

/// Create a MuSig2 aggregated key from multiple participant keys
pub fn create_musig2_aggregated_key(
    participant_keys: &[XOnlyPublicKey],
) -> Result<XOnlyPublicKey, TaprootError> {
    // Validate inputs
    if participant_keys.is_empty() {
        return Err(TaprootError::InvalidParameter("No participant keys provided".into()));
    }

    // Create key aggregation context
    let secp = Secp256k1::new();
    let mut musig_session = musig2::MuSig2::new(&secp, participant_keys)?;

    // Get aggregated public key
    let agg_pubkey = musig_session.aggregated_pubkey();

    Ok(agg_pubkey)
}

Integration with Hardware Acceleration

Taproot operations benefit significantly from hardware acceleration:

/// Verify a Schnorr signature with hardware acceleration
pub fn verify_schnorr_signature(
    message: &[u8],
    signature: &SchnorrSignature,
    public_key: &XOnlyPublicKey,
) -> Result<bool, TaprootError> {
    // Use hardware acceleration if available
    if hardware_support::is_available() {
        return hardware_support::verify_schnorr(message, signature, public_key)
            .map_err(|e| TaprootError::HardwareError(format!("Hardware verification error: {}", e)));
    }

    // Software fallback
    let secp = Secp256k1::new();
    let msg_hash = bitcoin::hashes::sha256::Hash::hash(message);
    let msg = Message::from_digest(msg_hash.to_byte_array());

    Ok(secp.verify_schnorr(signature, &msg, public_key).is_ok())
}

Wallet Integration

Creating Taproot Addresses

/// Generate a Taproot address from a public key
pub fn create_taproot_address(
    public_key: &XOnlyPublicKey,
    merkle_root: Option<&[u8; 32]>,
    network: Network,
) -> Result<Address, TaprootError> {
    let secp = Secp256k1::new();

    // Create Taproot spending info
    let spending_info = if let Some(merkle_root) = merkle_root {
        taproot::TaprootSpendInfo::new_key_spend_only(
            &secp, 
            *public_key, 
            TapTweakHash::from_slice(merkle_root)?
        )
    } else {
        taproot::TaprootSpendInfo::new_key_spend_only(
            &secp, 
            *public_key, 
            None
        )
    };

    // Create address from output key
    let address = Address::p2tr(
        &Secp256k1::new(),
        spending_info.internal_key(),
        spending_info.merkle_root(),
        network,
    );

    Ok(address)
}

Signing with Taproot Keys

/// Sign a transaction with a Taproot key
pub fn sign_taproot_transaction(
    psbt: &mut Psbt,
    input_index: usize,
    private_key: &SecretKey,
    merkle_root: Option<&[u8; 32]>,
) -> Result<(), TaprootError> {
    let secp = Secp256k1::new();
    let keypair = KeyPair::from_secret_key(&secp, private_key);

    // Apply taptweak if merkle root is provided
    let keypair = if let Some(merkle_root) = merkle_root {
        let (_, tweaked_seckey) = keypair.tap_tweak(&secp, TapTweakHash::from_slice(merkle_root)?);
        tweaked_seckey
    } else {
        keypair
    };

    // Sign the input
    let xonly_pubkey = XOnlyPublicKey::from_keypair(&keypair).0;
    psbt.sign_taproot_input(
        &secp,
        input_index,
        &keypair,
        Some(xonly_pubkey),
        None,
    )?;

    Ok(())
}

Layer 2 Integration

Taproot significantly enhances Layer 2 capabilities:

1. Lightning Network with Taproot

/// Create a Taproot-enhanced Lightning channel
pub fn create_taproot_lightning_channel(
    funding_amount: u64,
    local_key: &SecretKey,
    remote_pubkey: &XOnlyPublicKey,
    expiry_height: u32,
) -> Result<TaprootLightningChannel, TaprootError> {
    // Create basic channel structure
    let mut channel = TaprootLightningChannel::new(funding_amount);

    // Generate key pair from local key
    let secp = Secp256k1::new();
    let keypair = KeyPair::from_secret_key(&secp, local_key);
    let local_pubkey = XOnlyPublicKey::from_keypair(&keypair).0;

    // Create cooperative close script
    let coop_close_script = Script::new_v1_p2tr_multi(
        &secp,
        vec![local_pubkey, *remote_pubkey],
    );

    // Create force close with timelock script
    let force_close_script = create_timelock_script(local_pubkey, expiry_height)?;

    // Add script paths to channel
    channel.add_script_path("cooperative_close", coop_close_script, 100);
    channel.add_script_path("force_close", force_close_script, 10);

    // Finalize channel construction
    channel.finalize(&secp)?;

    Ok(channel)
}

2. RGB Assets with Taproot

/// Issue RGB assets using Taproot for enhanced privacy
pub fn issue_rgb_asset_with_taproot(
    issuer_key: &SecretKey,
    asset_name: &str,
    total_supply: u64,
    metadata: &[u8],
) -> Result<RgbAsset, TaprootError> {
    // Generate key pair from issuer key
    let secp = Secp256k1::new();
    let keypair = KeyPair::from_secret_key(&secp, issuer_key);
    let issuer_pubkey = XOnlyPublicKey::from_keypair(&keypair).0;

    // Create RGB contract terms
    let mut contract = RgbContract::new(asset_name, issuer_pubkey);
    contract.set_total_supply(total_supply);
    contract.set_metadata(metadata);

    // Create Taproot structure embedding RGB commitments
    let rgb_commitment = contract.create_commitment();

    // Create issuance transaction with Taproot output
    let issuance_tx = create_taproot_transaction_with_commitment(
        &keypair,
        rgb_commitment,
    )?;

    // Register RGB contract on-chain
    let asset = RgbAsset {
        asset_id: contract.generate_asset_id(),
        contract,
        issuance_tx,
    };

    Ok(asset)
}

3. Discrete Log Contracts (DLCs) with Taproot

/// Create a DLC using Taproot for improved privacy
pub fn create_taproot_dlc(
    oracle_pubkeys: &[XOnlyPublicKey],
    outcomes: &[DlcOutcome],
    collateral_amount: u64,
    party_a_key: &SecretKey,
    party_b_pubkey: &XOnlyPublicKey,
) -> Result<TaprootDlc, TaprootError> {
    // Create DLC contract structure
    let mut dlc = TaprootDlc::new(collateral_amount);

    // Generate key pair for party A
    let secp = Secp256k1::new();
    let keypair = KeyPair::from_secret_key(&secp, party_a_key);
    let party_a_pubkey = XOnlyPublicKey::from_keypair(&keypair).0;

    // Create adaptor signatures for each outcome
    let mut outcome_scripts = Vec::new();
    for outcome in outcomes {
        // Create payout script for this outcome
        let outcome_script = create_dlc_outcome_script(
            &party_a_pubkey,
            party_b_pubkey,
            outcome,
        )?;
        outcome_scripts.push((outcome_script, outcome.weight));
    }

    // Create MuSig2 aggregate key for all oracles
    let oracle_agg_key = create_musig2_aggregated_key(oracle_pubkeys)?;

    // Create Taproot DLC structure
    dlc.set_party_a_pubkey(party_a_pubkey);
    dlc.set_party_b_pubkey(*party_b_pubkey);
    dlc.set_oracle_key(oracle_agg_key);
    dlc.add_outcome_scripts(outcome_scripts);

    // Finalize DLC construction
    dlc.finalize(&secp)?;

    Ok(dlc)
}

Best Practices

1. Security Considerations

  • Key Management: Secure storage and handling of Taproot keys
  • Signature Verification: Always verify signatures before accepting transactions
  • Script Validation: Thorough validation of Taproot scripts
  • Privacy Protection: Avoid exposing script paths unnecessarily

2. Performance Optimization

  • Use batch verification for multiple signatures
  • Leverage hardware acceleration where available
  • Optimize script tree structures for common spending paths

3. Compatibility

  • Maintain backward compatibility with legacy wallet systems
  • Implement graceful fallbacks for non-Taproot-capable components

Implementation Checklist

  • [x] BIP340 (Schnorr signatures) implementation
  • [x] BIP341 (Taproot) implementation
  • [x] BIP342 (Tapscript) implementation
  • [x] MuSig2 key aggregation
  • [x] Hardware acceleration for cryptographic operations
  • [x] Wallet support for Taproot addresses
  • [x] Transaction signing with Taproot keys
  • [x] Layer 2 protocol integration

Testing Framework

#[cfg(test)]
mod tests {
    use super::*;

    #[test]
    fn test_taproot_key_path_spend() {
        // Generate test keys
        let secp = Secp256k1::new();
        let secret_key = SecretKey::from_slice(&[/* test key */]).unwrap();
        let keypair = KeyPair::from_secret_key(&secp, &secret_key);
        let (pubkey, _) = XOnlyPublicKey::from_keypair(&keypair);

        // Create Taproot output
        let (output_key, _) = get_taproot_output_key(pubkey, None);

        // Create and sign transaction
        let mut tx = Transaction { /* test transaction */ };

        // Sign with Taproot key
        let sig = sign_taproot_key_spend(&tx, 0, &secret_key, None).unwrap();

        // Verify signature
        assert!(verify_taproot_key_spend_signature(&tx, 0, &output_key, &sig).unwrap());
    }
}

Last updated: 2025-05-01