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UTXO Support

Motivations

With UTXO support, it is possible to attach / detach Counterparty assets directly to / from Bitcoin UTXOs, so that they can be spent just like Colored Coins–based protocols (such as Ordinals and Runes) using any Bitcoin wallets with support for sat tracking. This featuer enables single-transaction, trustless atomic swaps between BTC and Counterparty assets, as well as Counterparty assets and other L2 protocols. Attaching assets to UTXOs uses the new gas system that allows for a dynamic XCP fee for transactions to reduce the barrier to entry into Counterparty for new users.

Design

Attach​

  1. It is possible to attach an arbitrary number of assets from an address to a UTXO.

  2. Assets are attached from transaction source address to the first UTXO non-OP_RETURN output or, if provided, to the destination_vout output.

  3. If destination_vout designates an invalid output (OP_RETURN or non-existent) or if the transaction contains only a single OP_RETURN output, the transaction is invalid.

  4. Fees in XCP, calculated using the new gas system, will be paid by the source address for an attach.

  5. For each attach, a row will be added to the send table, triggering the ATTACH_TO_UTXO event.

  6. When assets are attached to a UTXO, it is impossible to use them for a Counterparty transaction (order, send, etc.), apart from detach.

  7. The embedded data in a attach transaction is small enough that an OP_RETURN output is always sufficient.

Detach​

  1. All inputs of every detach transaction are detached.

  2. If no destination is provided, the assets are sent to the address corresponding to the detached input.

  3. It is impossible to perform a move at the same time as a detach.

  4. For each detach, a row will be added to the send table, triggering the DETACH_FROM_UTXO event.

  5. The embedded data in a detach transaction is small enough that an OP_RETURN output is always sufficient.

Move​

  1. utxo.move_assets() is executed before all Counterparty contracts, except for attach transaction.

  2. When a UTXO is spent, a row is added to the send table for each asset attached to this UTXO, triggering a UTXO_MOVE event.

API

  1. API routes
"/v2/addresses/<address>/compose/attach": compose.compose_attach,
"/v2/utxos/<utxo>/compose/detach": compose.compose_detach,
"/v2/utxos/<utxo>/compose/movetoutxo": compose.compose_movetoutxo,
"/v2/compose/attach/estimatexcpfees": compose.get_attach_estimate_xcp_fee,

  1. To prevent assets from being moved unintentionally, the transaction composition API excludes UTXOs with assets attached by default.

  2. Balances contain two fields for UTXO support: utxo and utxo_address.