Design plan for SegWit support

[oscarguindzberg]

This is a Bisq Network project. Please familiarize yourself with the project management process.

Description

Design a plan for migrating to bitcoinj 0.15 and using segwit in bisq. Implementation is not part of this project.

Rationale

Benefits of using segwit:

• Users could withdraw btc from their bisq wallet to an external segwit (bech32) address.
• Pay less fees in btc transactions when segwit is used.
• Eliminate a transaction malleability exploit in the trade protocol which can cause the deposit TX and payout TX
  to become invalidated.
• Extra: get access to all the new features in bitcoinj 0.15 (not immediate benefit, but the potential is there)

A design/plan project is created because there are options to evaluate, decisions to make and it would be very hard to estimate implementation before design/plan is done.

Criteria for delivery

• Document with a design/plan for using segwit in bisq. Alternatives, roadblocks, pro/cons and migration concerns should be described.

Measures of success

• An implementation project is started.
• Once implemented...
• User withdraw btc from their Bisq wallet to a external segwit (bech32) addresses.
• btc transactions are cheaper, users perceive it is cheaper to use bisq.
• Malleability exploit in the trade protocol is gone.
• bitcoinj 0.15 features are used by bisq devs.

Risks

• Since this is a plan/design project, the only risk is its outcome is not implemented.

Tasks

• Plan migration to bitcoinj 0.15
• List different parts of bisq where segwit could be adopted and evaluate cost/benefit of each one.
• List segwit migration alternatives and evaluate cost/benefit of each one.
• Write an implementation plan for the chosen alternative.

Estimates

4000 USD

Notes

[dmos62]

Welcome back, @oscarguindzberg! I'm in early stages of a Bisq-side BitcoinJ refactor (#30), with the goal of making maintenance easier for Bisq-side devs and the BitcoinJ maintainer. Currently, I'm finishing up a concrete-ish sketch of what I have in mind and should post it soon enough.

I would like to bounce some ideas off you and see how to make this refactor more helpful to your BitcoinJ-related projects here. I see that you haven't created a Keybase account yet. Could you reach me there when you do? My handle is dmos.

[cbeams]

@sqrrm (acting dev team lead) and I met and discussed this project and approved it. I've updated the labels to reflect, and I've added this issue to the Master Projects Board as In Progress.

@oscarguindzberg, let us know if you need anything along the way. Thanks.

[oscarguindzberg]

@cbeams Thanks, I don't have any questions so far. @sqrrm and I had a conversation a few days ago, he explained me the basics of the trade protocol.

@dmos62 I will contact you on keybase probably next week.

[chimp1984]

@cbeams Can we close that?

[cbeams]

Closing as (long ago) complete.