[bitcoin-dev] BIP proposal: Anti-fee-sniping protection with nSequence in taproot transactions to improve privacy for off-chain protocols

[Chris Belcher]

Hello list,

Someone reviewing my taproot privacy BIP proposal suggested
clarification on the spec, so I've written some python-like pseudocode.
It implements the suggestion of choosing a random input instead of the
first one.

Some wallet teams are already working on implementing taproot for their
on-chain app. I urge wallet developers to include this BIP as well, so
that their user's spends will improve the privacy and fungibility of
off-chain protocols. Also, and admittedly a less urgently,
anti-fee-sniping will improve the incentives for miners in the
low-inflation future of bitcoin.

As before find the latest version of this BIP here:
https://gist.github.com/chris-belcher/903feab321bf41055c91eaec46581e89


def apply_anti_fee_sniping_fields(transaction):
    # bip68 requires v=2
    transaction.version = 2
    # always set nlocktime if any of the transaction inputs have more
    # confirmations than 65535 or are taproot inputs
    # otherwise choose either nlocktime or nsequence with 50% odds
    if any(map(lambda input: input.confirmations() > 65535
	    || input.is_taproot(), transaction.inputs))\
	    || randint(2) == 0:
	transaction.nlocktime = blockchain.height()
	if randint(10) == 0:
	    transaction.nlocktime = max(0, transaction.nlocktime
	    - randint(0, 99))
    else:
	input_index = randint(len(transaction.inputs))
	transaction.inputs[input_index].nsequence = transaction.inputs\
	    [input_index].confirmations()
	if randint(10) == 0:
	    transaction.inputs[input_index].nsequence = max(0,
		transaction.inputs[input_index].nsequence
                - randint(0, 99))