Creating a Raw Segwit Transaction from Scratch: Understanding the CHECK(MULTI)SIG Operation

As a Bitcoin developer, creating Segwit transactions is a fundamental task. However, understanding the underlying mechanics can be complex, especially for beginners. In this article, we will delve into the details of creating a raw Segwit transaction from scratch and tackle the challenging CHECK(MULTI)SIG operation.

Continue Basics

Before diving into raw Segwit transactions, let’s quickly review the basics:

• Segwit (Segregated Witness): Segwit is an extension of Bitcoin that allows for multiple signatures per input. This feature was introduced to reduce the number of blocks required to validate a block and increase network efficiency.

• CHECK(MULTI)SIG: CHECK(MULTI)SIG is a transaction verification mechanism used in Segwit transactions. It ensures that each output can be verified by any miner, without requiring a unique signature for each input.

Creating a Raw Segwit Transaction

To create a raw Segwit transaction from scratch, you need to follow these steps:

• Prepare the input data: You need to prepare an input block with multiple outputs. Each output should have its own set of inputs and corresponding coinbase transactions.

• Create a transaction: Create a new transaction using the tx command-line tool or a library like Bitcoin-Java. Make sure to specify the transaction version (currently 1) and the type of input (output).

• Add output data: Add multiple outputs to the transaction, specifying their respective inputs, coinbase transactions, and the scriptPubKey for each output.

• Generate the raw transaction data: Use a library like Bitcoin-Java to generate the raw transaction data in PEM format.

Here’s an example of how you can create a raw Segwit transaction using Bitcoin-Java:

import org.bouncycastle.openpgp.PGPException;

import org.bouncycastle.openpgp.PGPPublicKey;


public class RawSegwitTransaction {

    public static void main(String[] args) throws PGPException {

        // Prepare the input data

        InputBlock input = new InputBlock();

        OutputBlock output1 = new OutputBlock();

        OutputBlock output2 = new OutputBlock();


        // Create a transaction

        Transaction tx = new Transaction(input);


        // Add output data

        output1.setInputs(new ArrayList() {{

            add(new OutputInput(1, "scriptPubKey", "m/44'/0'/0'/0"));

            add(new OutputInput(2, "scriptPubKey", "m/44'/1'/0'/1"));

        }});

        output2.setInputs(new ArrayList() {{

            add(new OutputInput(3, "scriptPubKey", "m/44'/2'/0'/0"));

            add(new OutputInput(4, "scriptPubKey", "m/44'/3'/0'/0"));

        }});


        // Generate the raw transaction data in PEM format

        byte[] pem = tx.toPem();

        System.out.println("Raw Segwit Transaction:");

        System.out.println(pem);

    }

}

CHECK(MULTI)SIG Operation

Now that you have created a raw Segwit transaction, let’s dive into the CHECK(MULTI)SIG operation.

CHECK(MULTI)SIG ensures that each output can be verified by any miner, without requiring a unique signature for each input. Here’s how it works:

• Input validation: The CHECK(MULTI)SIG function validates the inputs of the transaction to ensure they are valid.

• Transaction verification: If all inputs are valid, the CHECK(MULTI)SIG function verifies the transaction by checking if each output can be verified by any miner using the corresponding scriptPubKey.

In the example above, we assume that the scriptPubKey for each output is correct and matches the scriptPubKey of a trusted key. If an input validation error occurs or if a malicious transaction is created, CHECK(MULTI)SIG will fail to verify the transaction.

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