{"id":194,"date":"2023-09-25T13:00:44","date_gmt":"2023-09-25T11:00:44","guid":{"rendered":"https:\/\/blog.clovrlabs.com\/?p=194"},"modified":"2024-06-21T13:47:29","modified_gmt":"2024-06-21T11:47:29","slug":"nodeguard-signer-extension","status":"publish","type":"post","link":"https:\/\/clovrlabs.com\/blog\/en\/nodeguard-signer-extension\/","title":{"rendered":"NodeGuard Signer Extension: How to sign a PSBT in Rust"},"content":{"rendered":"\t\t
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Note: AI did not write this article. This is precisely what an AI would say, right? Suspicious \ud83e\udd14\u2026<\/div>\n\t\t\t\n\t\t\t\t\t\t
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\n\t\t\t\t\t\t\t\"Rodrigo\"\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t
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Rodrigo S\u00e1nchez<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t
Software Developer<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t
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At Clovr Labs, we developed NodeGuard, a treasury management system that allows people to have money secured behind multi-signature wallets (among other features). One of the benefits of multi-signature wallets is that because of how they are constructed, a \u201ccontract\u201d prevents a single person from owning the funds. For money to change hands, multiple people must sign the operation to approve the ownership change.<\/p>

To make signing more straightforward, we\u2019re developing a browser extension allowing people to import their seeds and sign an operation. This extension will be open-sourced in the future. It will be open for everyone to use, not only in the NodeGuard application but with their own applications.<\/p>

Now, let\u2019s talk about multi-signature wallets, AKA multi-sig wallets. As stated before, multi-sig wallets are wallets in which the ownership of funds belongs to more than one person at a time. In addition, multi-sig wallets are referred to by the \u201cM-of-N\u201d description, where \u201cN\u201d denotes the number of total signers \u201cagreeing\u201d to construct the wallet. In contrast, \u201cM\u201d represents the number of signers required to do an operation or \u201ctransaction\u201d with these funds.<\/p>

Let\u2019s set an example. Imagine I belong to a group of 3 friends, and we constructed a 2-of-3 multi-sig wallet together. That means that the 3 of us \u201cagreed\u201d to create a wallet together, and we would only need the signature of 2 friends to change ownership of funds. Since we want to send funds to a different wallet, another friend and I must sign off on a transaction. Even though my other friend \u201cagreed\u201d to be part of the wallet, they are not needed to sign.<\/p>

Let\u2019s do another example. I have a friend who has a business in which he has one other partner. My friend comes from a construction background, and his partner comes from an architecture background; they don\u2019t trust each other but decided to go into a business together because they complement each other well. They decided to create a Bitcoin 2-of-2 multi-sig wallet. In this scenario, they both agreed to make the wallet. The contract specifies that both signatures are needed to transact with their funds.<\/p>

As you see, the flexibility of M-of-N wallets allows for a world of possibilities in which funds are secured via many different configurations: 3-of-6, 2-of-2, etc.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t

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\n\n\t\t\t\t\t\tIn this article, we will learn how to sign off on a transaction by multiple people using the Rust language. But first, we need to learn a few concepts that will allow us to understand the code better.<\/span>\n\t\t\t\n\t\t\t\n\t\t\t\n\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t
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\ud83d\udd39 Wallet<\/h4>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t
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We talked about multi-sig wallets, but how are they constructed? We mentioned in the last part that we need to sign something (we\u2019ll talk about what later) to perform a transaction. The way signatures work in Bitcoin is pretty much how a safe work in real life. To access the content of a safe, you need to prove that you know the safe combination. In comparison, to see that you have ownership of funds in Bitcoin, you need to prove that you own a \u201cprivate key\u201d, which is a 256-bit number. This private key can be encoded as 64 hexadecimal characters so humans can easily read it. In the case of a 2-of-3 multi-sig wallet, you can imagine a safe with 3 keypads, but only two out of the 3 combinations are needed to be input to open it. So in the case of a Bitcoin wallet, you (or your friends) need to prove that they know 2 of the private keys to sign off on a transaction.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t

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\ud83d\udd39 Public Keys<\/h4>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t
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A public key is an essential part of how wallets work. It is the face of a wallet and how wallets are constructed. The public key is derived from the private key and generates an address for receiving Bitcoin. The derivation of a public key is one way; even if someone knows your public key, they cannot retrieve the private key from it. Public keys are combined to generate an address to receive funds in a multi-sig wallet. Once funds are transferred to that address, private keys can be used to prove the ownership of that public key and \u201cunlock\u201d the funds for further expending. This is one of the main reasons you see that whenever someone loses their wallet keys, the funds are lost forever since it\u2019s impossible to reconstruct the private key from a public key. And the possibilities of guessing a private key, even with powerful computers, are astronomically small.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t

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\ud83d\udd39 Derivation Path<\/h4>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t
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A Bitcoin wallet uses a derivation path to derive multiple public keys and, in turn, create infinitely different Bitcoin addresses for the same wallet. You can think of derivation paths as other safes belonging to the same person that lives in different buildings, cities and countries. To unlock money from a safe, we first need to know the country, city, building, room and safe number. With that information, we know which safe to input the password, and the password we\u2019ll use will depend on the safe number. In Bitcoin, in contrast, the passwords from the different safes in a room can be derived from the password that unlocks the door of the room. Which also is safe if you think of a room as a big safe with a password-protected door. We\u2019ll not talk about some other complexities regarding derivation paths here. But to sign off on a transaction, we first need to know in which \u201csafe\u201d the money is and if we can prove ownership of the secret to use that money.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t

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\ud83d\udd39 Fingerprint<\/h4>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t
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A fingerprint is a more compact version of a private key. As the name suggests, it identifies a private key without using the long private key itself. In our case, we\u2019ll use it to quickly verify that our private key can be used to sign a transaction and prove that the money is ours before signing off on the transaction.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t

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\ud83d\udd39 Inputs<\/h4>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t
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Inputs consist of information saying where the money comes from, a reference to previous transaction outputs, and information proving that the funds we want to use are authorized to be spent. Every time you do a transaction, e.g., spend money in Bitcoin, a transaction id is generated as the output of that transaction. The input contains the id of the previous transaction being made, so you can trace the money back until it was created. Because an earlier transaction can be done with more than one input, an index is necessary to identify which transaction inputs are being spent. This is somewhat difficult to follow, so let\u2019s see the anatomy of a transaction:<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t

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