Modeling transactions

BALZaC provides a simple syntax to express Bitcoin transactions. You can try the code of this example in the web editor. Let’s break it down the syntax through a series of examples. The following is an example of a coinbase transaction.

transaction T {
        input = _
        output = 50 BTC: fun(x) . x==42
}

Since T is a coinbase, it generates new bitcoins. As a consequence, its input field is empty (denoted by _). The transaction has an output of 50 BTC, and its script specifies that it can be redeemed by whoever can provide a value equal to 42 (so, anyone).

Now we will take advantage of our advanced knowledge of transactions and redeem T. To do so, we create T1 as follows.

transaction T1 {
        input = T: 42
        output = [
                20 BTC: fun(x) . x!=0;
                30 BTC: fun(x,y) . x == y+2
                ]
}

T1 redeems T, providing 42 as witness. The witness is evaluated against the script in the output of T, i.e. fun(x) . x==42. But, differently from the previous example, the transaction splits the bitcoins it redeems between two outputs. The first contains 20 BTC and can be redeemed whit a witness different from 0, while the other contains 30 BTC and can be redeemed solving a simple equation.

This time we want to redeem our bitcoins and secure them in a transaction that can be spent only by us.

const k = wif:cSthBXr8YQAexpKeh22LB9PdextVE1UJeahmyns5LzcmMDSy59L4

transaction T2 {
        input = [
                T1@0: 1;
                T1@1: 2 0
                ]
        output = 50 BTC: fun(x) . versig(k; x)
}

Now that we are redeeming T1, a transaction with multiple input, we have to specify which output we want to redeem. In this case T2 redeems the first and the second output of T1, i.e. T1@1 and T1@2 respectively. The output of T2 requires the parameter x to be a signature that matches the key k. The key is declared at line 1, and it is prefixed by the keyword wif: to denote that it is expressed in the Wallet Import Format [1]. In this way, the output can only be redeemed by the owner of the key.

To send T2 to the Bitcoin network, we can compile it using the statement compile T2.

_images/overview.png

After hitting the button Compile, the web editor shows in the output box the compilation details and T2 in Bitcoin serialization format. The serialized transaction can be send to the network using bitcoin-cli sendrawtransaction.

Bitcoin offers the flexibility to express more complex scripts than simply verifying a signature, as you can see at Expressions. This features can be exploited to design smart contracts, i.e. cryptographic protocols that can handle transfers of bitcoins. You can see a series of example, e.g. Timed Commitment.

Footnotes

[1]https://bitcoin.org/en/developer-guide#wallet-import-format-wif