Hi everyone! Excited to see this work moving forward. I've taken the liberty of carving off the 64 byte transaction portion of this proposal and drafted a BIP. You can view a rendered draft with references here: https://github.com/Christewart/bips/blob/2024-12-20-64bytetxs/bip-XXXX.mediawiki

<pre>
  BIP: ?
  Layer: Consensus (soft fork)
  Title: Disallow 64 byte transactions
  Author: Chris Stewart <stewart.chris1234@gmail.com>
  Status: Draft
  Type: Specification
  License: BSD-3-Clause
  Created: ?
</pre>

==Abstract==

This BIP describes the rationale for disallowing transactions that are serialized to 64 bytes without the transaction's witness.
We describe the weaknesses to the merkle tree included in bitcoin block headers, various exploits for those weaknesses.

==Motivation==

Bitcoin block headers include a commitment to the set of transactions in a given
block, which is implemented by constructing a Merkle tree of transaction id’s
(double-SHA256 hash of a transaction) and including the root of the tree in the
block header. This in turn allows for proving to a Bitcoin light client that a
given transaction is in a given block by providing a path through the tree to the
transaction. However, Bitcoin’s particular construction of the Merkle tree has
several security weaknesses, including at least two forms of block malleability
that have an impact on the consensus logic of Bitcoin Core, and an attack on
light clients, where an invalid transaction could be ”proven” to appear in a block
by doing substantially less work than a SHA256 hash collision would require.
This has been prevented by relay policy since 2018<ref>[https://github.com/bitcoin/bitcoin/pull/11423/commits/7485488e907e236133a016ba7064c89bf9ab6da3 PR #11423 disallows 64 byte transactions in bitcoin core relay]</ref>

==Specification==

This BIP disallows bitcoin transactions that are serialized to 64 bytes in length without it's witness.

==Rationale==

=== Block malleability ===

64 byte transactions introduce block malleability. Malicious peers can construct consensus valid and invalid 64 byte
transactions that have the same serialization as the concatenation of 2 nodes in the merkle tree.

Assume we have a valid bitcoin block with 2 transactions in it - T₀ and T₁.
The merkle root for this block is H(T₀||T₁).
A user could find a malicious 64 byte transaction T_m that serializes to T₀||T₁.
Next the malicious user relays the block containing the malicious T_m rather than the
valid bitcoin transactions T₀ and T₁.

==== Block malleability with consensus INVALID transactions ====

The peer receiving the malicious block marks the block as invalid as T_m
is not a valid transaction according to network consensus rules.
Other peers on the network receive the valid block containing T₀ and T₁
add the block to their blockchain. Peers that receive the invalid block before the valid block
will never come to consensus with their peers due to the malicious user finding a collision
within the block's merkle root. Finding this collision approximately 22 bits worth of work<ref>[https://github.com/Christewart/bips/blob/2024-12-20-64bytetxs/bip-XXXX/2-BitcoinMerkle.pdf to produce a block that has a Merkle
root which is a hash of a 64-byte quantity that deserializes validly, it’s enough
to just do 8 bits of work to find a workable coinbase (which will hash to the first
32 bytes), plus another ≈22 bits of work ((1/5) ∗224, so slightly less) to find
a workable second transaction which will hash to the second 32 bytes) – a very
small amount of computation.]</ref>

This attack vector was fixed in 0.6.2<ref>[https://bitcoin.org/en/alert/2012-05-14-dos#risks CVE-2012-2459]</ref>, re-introduced in 0.13.x<ref>[https://github.com/bitcoin/bitcoin/pull/7225 #7225]</ref> and patched again in
0.14<ref>[https://github.com/bitcoin/bitcoin/pull/9765 #9765]</ref> of bitcoin core.

==== Block malleability with consensus VALID transactions ====

Producing a valid bitcoin transaction T_m that adheres to network consesnsus
rules requires 224 bits of work<ref>[https://github.com/Christewart/bips/blob/2024-12-20-64bytetxs/bip-XXXX/2-BitcoinMerkle.pdf Note that the first transaction in a block must be a coinbase, and as discussed
above, that largely constrains the first 32 bytes of the first transaction: only
the 4 version bytes are unconstrained. So it would take at least 28*8= 224 bits
of work to find the first node in a given row of the tree that would match the
first half of a coinbase, in addition to the amount of work required to grind the
second half of the transaction to something meaningful (which is much easier –
only 16 bytes or so are constrained, so approximately 128 bits of work to find a collision). Of course, any of the rows in the Merkle tree could be used, but it nevertheless seems clear that this should be computationally infeasible.]</ref>.
This is computationally and financially expensive but theoretically possible. This can lead to a persistent chain split on the network.

=== Attack on SPV clients ===

BIP37<ref>[https://github.com/bitcoin/bips/blob/master/bip-0037.mediawiki BIP37]</ref>provides a partial merkle tree format<ref>[https://github.com/bitcoin/bips/blob/master/bip-0037.mediawiki#user-content-Partial_Merkle_branch_format Partial Merkle Tree Format]</ref>
that allows you to verify your bitcoin transaction is included in a merkle root embedded in a bitcoin block header.
Notably this format does not commit to the height of the merkle tree.

Suppose a (valid) 64-byte transaction T is included in a block with the property that the second 32 bytes (which
are less constrained than the first 32 bytes) are constructed so that they collide
with the hash of some other fake, invalid transaction F. The attacker can fool the SPV client into believing that F
was included in a bitcoin block rather than T with 81 bits<ref>[https://github.com/Christewart/bips/blob/2024-12-20-64bytetxs/bip-XXXX/2-BitcoinMerkle.pdf An attacker who can do 81 bits of work (followed by another 40 bits of work, to
construct the funding transaction whose coins will be spent by this one) is able
to fool an SPV client in this way.]</ref> of work. This also reduces implementation complexity of SPV wallets<ref>[https://delvingbitcoin.org/t/great-consensus-cleanup-revival/710/43 The steps needed to make sure a merkle proof for a transaction is secure.]</ref>.

This could be mitigated by knowing the depth of the merkle tree. Requiring SPV clients to request both the coinbase transaction could mitigate this attack.
To produce a valid coinbase transaction at the same depth that our fake transaction F occurs at would require 224 bits of work.
As mentioned above, this is computionally and financially expensive, but theoretically possible.

==Backward compatibility==

There have been 5 64 byte transactions that have occcurred in the bitcoin blockchain as of this
writing <ref>[https://github.com/Christewart/bips/blob/2024-12-20-64bytetxs/64byte-tx-mainnet.txt 64 byte transactions in the bitcoin blockchain]</ref>
With the last transaction 7f2efc6546011ad3227b2da678be0d30c7f4b08e2ce57b5edadd437f9e27a612<ref>[https://mempool.space/tx/7f2efc6546011ad3227b2da678be0d30c7f4b08e2ce57b5edadd437f9e27a612 Last 64 byte transaction in the bitcoin blockchain]</ref>
occurring at block height 419,606<ref>[https://mempool.space/block/000000000000000000308f1efc24419f34a3bafcc2b53c32dd57e4502865fd84 Block 419,606]</ref>.

TODO

==Reference implementation==

<source lang="cpp">
/**
 * We want to enforce certain rules (specifically the 64-byte transaction check)
 * before we call CheckBlock to check the merkle root. This allows us to enforce
 * malleability checks which may interact with other CheckBlock checks.
 * This is currently called both in AcceptBlock prior to writing the block to
 * disk and in ConnectBlock.
 * Note that as this is called before merkle-tree checks so must never return a
 * non-malleable error condition.
 */
static bool ContextualBlockPreCheck(const CBlock& block, BlockValidationState& state, const ChainstateManager& chainman, const CBlockIndex* pindexPrev)
{
    if (DeploymentActiveAfter(pindexPrev, chainman, Consensus::DEPLOYMENT_64BYTETX)) {
      for (const auto& tx : block.vtx) {
            if (::GetSerializeSize(TX_NO_WITNESS(tx)) == 64) {
                return state.Invalid(BlockValidationResult::BLOCK_MUTATED, "64-byte-transaction", strprintf("size of tx %s without witness is 64 bytes", tx->GetHash().ToString()));
            }
        }
    }

    return true;
}
</source>

https://github.com/bitcoin-inquisition/bitcoin/pull/24/files

== Rationale ==

<references />

==Copyright==
This BIP is licensed under the [https://opensource.org/license/BSD-3-Clause BSD-3-Clause License].

==Acknowledgements==

Suhas Daftuar, AJ Towns, Sergio Demian Lerner, Greg Maxwell, Matt Corallo, Antoine Poinsont, Dave Harding and Erik Voskuil