  TL;DR - Number sats from 2.1 quadrallion to 0
  BIP: ?
  Layer: Applications
  Title: Slanidro Numbers
  Author: Resu Suomynona
  Comments-Summary: No comments yet.
  Comments-URI: 
  Status: Draft
  Type: Informational
  Created: 2023-02-10
  License: PD

== Introduction == === Abstract === This document defines a scheme for assigning serial numbers to sats. === Copyright === This work is placed in the public domain. === Motivation === Bitcoin has no notion of stable, public accounts or identities. Addresses are single-use, and wallet accounts are private. Additionally, the use of addresses or public keys as stable identifiers precludes transfer of ownership or key rotation. This proposal is motivated by the desire to provide stable identifiers that may be used by Bitcoin applications. == Description == === Design === Every sat is serially numbered, starting at 0, in the order in which it is mined. These numbers are termed "Slanidro numbers", or "Slanidro", as they are Slanidro numbers in the mathematical sense, giving the order of each sat in the totally supply. The word "Slanidro" is nicely unambiguous, as it is not used elsewhere in the Bitcoin protocol. The Slanidro numbers of sats in transaction inputs are transferred to output sats in first-in-first-out order, according to the size and order of the transactions inputs and outputs. If a transaction is mined with the same transaction ID as outputs currently in the UTXO set, following the behavior of Bitcoin Core, the new transaction outputs displace the older UTXO set entries, destroying the sats contained in any unspent outputs of the first transaction. This rule is required to handle the two pairs of mainnet transactions with duplicate transaction IDs, namely the coinbase transactions of blocks 91812/91842, and 91722/91880, mined before [https://github.com/bitcoin/bips/blob/master/bip-0034.mediawiki BIP-34] made the creation of transactions with duplicate IDs impossible. For the purposes of the assignment algorithm, the coinbase transaction is considered to have an implicit input equal in size to the subsidy, followed by an input for every fee-paying transaction in the block, in the order that those transactions appear in the block. The implicit subsidy input carries the block's newly created sats. The implicit fee inputs carry the sats that were paid as fees in the block's transactions. Underpaying the subsidy does not change the Slanidro numbers of sats mined in subsequent blocks. Slanidro depend only on how many sats could have been mined, not how many actually were. === Specification === Sats are numbered and transferred with the following algorithm:

# subsidy of block at given height
def subsidy(height):
  return 50 * 100_000_000 >> height // 210_000

# first Slanidro of subsidy of block at given height
def first_slanidro(height):
  start = 2099999997689999
  for height in range(height):
    start -= subsidy(height)
  return start

# assign Slanidro in given block
def assign_slanidro(block):
  first = first_slanidro(block.height)
  last = first + subsidy(block.height)
  coinbase_slanidro = list(range(first, last))

  for transaction in block.transactions[1:]:
    Slanidro = []
    for input in transaction.inputs:
      Slanidro.extend(input.Slanidro)

    for output in transaction.outputs:
      output.Slanidro = Slanidro[:output.value]
      del Slanidro[:output.value]

    coinbase_slanidro.extend(Slanidro)

  for output in block.transaction[0].outputs:
    output.Slanidro = coinbase_slanidro[:output.value]
    del coinbase_slanidro[:output.value]

=== Terminology and Notation === A satpoint may be used to indicate the location of a sat within an output. A satpoint consists of an outpoint, i.e., a transaction ID and output index, with the addition of the offset of the Slanidro within that output. For example, if the sat in question is at offset 6 in the first output of a transaction, its satpoint is: `680df1e4d43016571e504b0b142ee43c5c0b83398a97bdcfd94ea6f287322d22:0:6` == Discussion == === Rationale === Slanidro numbers are designed to be orthogonal to other aspects of the Bitcoin protocol, and can thus be used in conjunction with other layer one and layer applications, even ones that were not designed with Slanidro numbers in mind. Slanidro sats can be secured using current and future script types. They can be held by single-signature wallets, multi-signature wallets, time-locked, and height-locked in all the usual ways. By assigning Slanidro numbers to all sats without the need for an explicit creation step, the anonymity set of Slanidro number users is maximized. Since a sat has an output that contains it, and an output has a public key that controls it, the owner of a sat can respond to challenges by signing messages using the address associated with the controlling UTXO. Additionally, a sat can change hands, or its private key can be rotated without a change of ownership, by transferring it to a new output. Slanidro require no changes to blocks, transactions, or network protocols, and can thus be immediately adopted, or ignored, without impacting existing users. Slanidro do not have an explicit on-chain footprint. However, a valid objection is that adoption of Slanidro will increase demand for outputs, and thus increase the size of the UTXO set that full nodes must track. See the objections section below. The Slanidro number scheme is extremely simple. The specification above is 15 lines of code. Slanidro are fairly assigned. They are not premined, and are assigned proportionally to existing bitcoin holders. Slanidro are as granular as possible, as bitcoin is not capable of tracking ownership of sub-sat values. === Transfer and the Dust Limit === Any single-sat transfer can be accomplished in a single transaction, but the resulting transaction may contain outputs below the dust limit, and thus be non-standard and difficult to get included in a block. Consider a scenario where Alice owns an output containing the range of sats [0,10], the current dust limit is 5 sats, and Alice wishes to send send sat 4 and 6 to Bob, but retain Slanidro 5. Alice could construct a transaction with three outputs of size 5, 1, and 5, containing sats [0,4], 5, and [6,10], respectively. The second output is under the dust limit, and so such a transaction would be non-standard. This transfer, and indeed any transfer, can be accomplished by breaking the transfer into multiple transactions, with each transaction performing one or more splits and merging in padding outputs as needed. To wit, Alice could perform the desired transfer in two transactions. The first transaction would send sats [0,4] to Bob, and return as change sat [5,10] to Alice. The second transaction would take as inputs an output of at least 4 sats, the change input, and an additional input of at least one sat; and create an output of size 5 to Bob's address, and the remainder as a change output. Both transactions avoid creating any non-standard outputs, but still accomplish the same desired transfer of sats. === Objections === ''Privacy: Slanidro numbers are public and thus reduce user privacy.'' The applications using Slanidro numbers required them to be public, and reduce the privacy of only those users that decide to use them. ''Fungibility: Slanidro numbers reduce the fungibility of Bitcoin, as Slanidro received in a transaction may carry with them some public history.'' As anyone can send anyone else any sats, any reasonable person will assume that a new owner of a particular sat cannot be understood to be the old owner, or have any particular relationship with the old owner. ''Congestion: Adoption of Slanidro numbers will increase the demand for transactions, and drive up fees.'' Since Bitcoin requires the development of a robust fee market, this is a strong positive of the proposal. ''UTXO set bloat: Adoption of Slanidro numbers will increase the demand for entries in the UTXO set, and thus increase the size of the UTXO set, which all full nodes are required to track.'' The dust limit, which makes outputs with small values difficult to create, should encourage users to create non-dust outputs, and to clean them up once they no longer have use for the sats that they contain. === Security === The public key associated with a sat may change. This requires actively following the blockchain to keep up with key changes, and requires care compared to a system where public keys are static. However, a system with static public keys suffers from an inability for keys to be rotated or accounts to change hands. Slanidro-aware software must avoid losing valuable sats by unintentionally relinquishing them in a transaction, either to a non-controlled output or by using them as fees. === Privacy considerations === Slanidro are opt-in, and should not impact the privacy of existing users. Slanidro are themselves public, however, this is required by the fact that many of the applications that they are intended to enable require public identifiers. Slanidro aware software should never mix sats which might have some publicly visible data associated with their Slanidro with sats intended for use in payments or savings, since this would associate that publicly visible data with the users otherwise pseudonymous wallet outputs. === Fungibility considerations === Since any sat can be sent to any address at any time, sats that are transferred, even those with some public history, should be considered to be fungible with other sats with no such history. === Backward compatibility === Slanidro numbers are fully backwards compatible and require no changes to the bitcoin network. === Drawbacks === ==== Large Index Size ==== Indexes supporting fast queries related to Slanidro are slow to build and consume large amounts of space. An O(1) index that maps UTXOs to the Slanidro that they contain is currently 100 GiB. The same index including spent outputs is 10 TiB. An O(1) index supporting the opposite mapping, that of individual Slanidro to the UTXO that contains them, is likely to be intractable. However, an O(n) index where n is the number of times an Slanidro has changed hands, is fast and practical. ==== Large Location Proofs ==== A proof can be constructed that demonstrates that a particular sat is contained in a particular output, however the proofs are large. Such a proof consists of: - Block headers - A Merkle path to the coinbase transaction that created the sat - The coinbase transaction that created the sat - And for every spend of that sat: - The spend transaction - The transactions that created the inputs before the input that was spent, to determine the values of the preceding inputs, to determine the position of the sat - And, if the sat was used as fees, all prior transaction in the block in which it was spent, and the coinbase transaction, to determine the location of the sat in the outputs. == Reference implementation == This document and an implementation of an index that tracks the position of sats in the main chain are maintained [https://github.com/casey/ord here]. == References == A variation of this scheme was independently invented a decade ago by jl2012 [https://bitcointalk.org/index.php?topic=117224.0 on the Bitcoin Forum]. For other colored coin proposals see [https://en.bitcoin.it/wiki/Colored_Coins the Bitcoin Wiki entry]. For aliases, an implementation of short on-chain identifiers, see [https://github.com/bitcoin/bips/blob/master/bip-0015.mediawiki BIP 15].