UTXO
How the Bifrost works for UTXO chains like Bitcoin and its forks.
Chain Client
Example for Bitcoin.
Observer
Signer
Scanning Blocks
The block scanner monitors the Asgard Addresses and looks for incoming UTXOs spending to those addresses. When it sees one performs validation on it and witnesses to MAYAChain. For Bitcoin, it looks that at least 1 output is spent to Asgard, and searchs for another output to have an OP_RETURN. These two outputs form the amount and memo witness to MAYAChain.
Confirmation Counting
The txValue is the sum of all transactions received in a block to Asgard vaults. The blockValue is the coinbase value, which includes fees and subsidy. If a miner forgets to add a coinbase value (it has happened) a default of 6.25 is used. (This should be updated every 4 years, or use logic to auto-update).
Re-orgs
Bifrost tracks the BlockCacheSize = 144 blocks of transactions reported in a local KV store. Every time it detects a new block at a previous height it has seen, it checks for the presence of every transaction it has reported. If the transaction is missing then it has been re-orged out. The missing txID is reported to MAYAChain as an ErrataTx
Network Fees
Reported as sats/byte where the fee rate is computed over the last block. Reports the highest seen in the last 20 blocks.
Handling Gas
The gas amount for a transaction is just the difference between outputs and inputs.
Other Considerations
UTXO consolidation
UTXOs consume inputs, and these inputs need to be signed independently. Thus consuming 15 inputs requires 15 times the TSS bandwidth than a single input. To prevent runaway liabilities the client will automatically enter a TSS signing ceremony for Asgard every 15 inputs to consolidate them back to one. This transaction uses the consolidate memo and can be seen regularly on MAYAChain vaults.
ReplaceByFee
RBF transactions allow the spender to double-spend with a higher fee. Users can use RBF transactions to spend to Asgard, but RBF does not need to be used in the THORChain vaults.
Wallet Client
UTXO clients implemented in XChainJS have the following nuances:
Fees
The wallet client should spend with a fee rate at least equal to what is reported on inbound_addresses - if not it risks not being confirmed by the time the vault migrates.
Pending UTXOS
Do not consume pending transactions when spending to Asgard (with a memo) since it may consume a low-fee tx and get stuck.
MEMO
The memo is inserted as an OP_RETURN in an output. It can be any output. The MEMO is limited to 80 bytes, so it should be trimmed and use abbreviated memos or Asset identifiers where possible.
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