Human readable checksum (verification code) to avoid errors on BTC public addresses

Summary:

The proposal to implement a 3 or 4 digit code generated as a checksum from a BTC address has been put forward. This is to help avoid the risk of error when entering a valid but wrong BTC address for a transaction. Although there is an integrated checksum in BTC addresses, it is only used at a technical level and does not improve the overall user experience. The proposed 4DC should be shown in all wallets next to the receiving address so that when entering a new address to send BTC, the sending wallet should also show the 4DC next to the entered address. This way, the sending person can easily verify that the resulting 4DC matches the one from the receiving address. The proposal suggests that by using this method, the probability of performing transactions to a wrong address will be greatly reduced. Technically, this is very easy to implement - the only effort needed is agreeing on a checksum standard to generate the code. Once the standard is established, all wallet and exchange developers can start implementing this. However, it is noted that the main bulk of the effort may still take years of agreement.It was suggested that the last 5 characters of a bech32 string are already a human-readable 5-digit code with good properties. It is not clear why it cannot be used for this case. Additionally, if the existing bech32 checksum is automatically checked by the software, it is unclear why forcing something to be manually checked by a human is better than leaving the checking to software.

Updated on: 2023-06-15T01:08:22.248018+00:00