Data Anchoring with OP_RETURN

To follow along this tutorial

Clone the Github repository
cd code
npm install or yarn install
Execute the transaction code by typing node tx_filename.js
Alternatively you can enter the commands step-by-step by cd into ./code then type node in a terminal to open the Node.js REPL
Open the Bitcoin Core GUI console or use bitcoin-cli for the Bitcoin Core commands
Use bx aka Libbitcoin-explorer as a handy complement

Let’s store for eternity some data on the Bitcoin blockchain using the special OP_RETURN opcode. It will create a special nulldata output type.

An output using an OP_RETURN is provably unspendable, so we don’t need to lock any BTC in this UTXO. However, we still need to pay the miner fees, so we will spend BTC from a previous P2WPKH UTXO, create one nulldata UTXO and an other one for the change, leaving the difference as mining fees.

For more information about OP_RETURN check out:

Create a UTXO to spend from

Let’s create a P2WPKH UTXO to spend from.

Import libraries, test wallet and set the network.

const bitcoin = require('bitcoinjs-lib')
const { alice } = require('./wallets.json')
const network = bitcoin.networks.regtest

Send 1 BTC to alice_1 P2WPKH address via Bitcoin Core CLI.

sendtoaddress bcrt1qlwyzpu67l7s9gwv4gzuv4psypkxa4fx4ggs05g 1

Get the output index so that we have the outpoint (txid / vout).

gettransaction TX_ID

Find the output index (or vout) under vout.

Creating the transaction

Now let’s create our OP_RETURN P2PKH UTXO.

Create a bitcoinJS key pair object for the spender alice_1 and a P2WPKH address that we will use for the change.

const keyPairAlice1 = bitcoin.ECPair.fromWIF(alice[1].wif, network)

Create a PSBT.

const psbt = new bitcoin.Psbt({network})

Create the input by filling TX_ID and TX_VOUT.

psbt
  .addInput({
    hash: 'TX_ID',
    index: TX_VOUT,
    witnessUtxo: {
      script: Buffer.from('0014' + alice[1].pubKeyHash, 'hex'),
      value: 1e8,
    },
  })

Create an OP_RETURN output with BitcoinJS embed payment method.

const data = Buffer.from('Programmable money FTW', 'utf8')
const embed = bitcoin.payments.embed({data: [data]})

psbt
  .addOutput({
    script: embed.output,
    value: 0,
  })

An output using an OP_RETURN is provably unspendable, the script will always evaluate to false. For this reason, and because this is a Bitcoin Core policy rule, the value of an OP_RETURN output is set to 0.

Create a second output to get back the change. 100 000 000 - 100 000(fees) = 99 900 000 sats

psbt
  .addOutput({
    address: alice[1].p2wpkh,
    value: 999e5,
  })

Keep note of the bitcoin value of the UTXO we are spending, necessary because we are spending a P2WPKH.

Alice_1 signs the first input.

psbt.signInput(0, keyPairAlice1)

Finalize the PSBT.

psbt.validateSignaturesOfInput(0)
psbt.finalizeAllInputs()

Finally we can extract the transaction and get the raw hex serialization.

console.log('Transaction hexadecimal:')
console.log(psbt.extractTransaction().toHex())

Inspect the raw transaction with Bitcoin Core CLI, check that everything is correct.

decoderawtransaction TX_HEX

Broadcasting the transaction

It’s time to broadcast the transaction.

sendrawtransaction TX_HEX

Inspect the transaction.

getrawtransaction TX_ID true

Observations

We note that the OP_RETURN UTXO is marked with the special type nulldata.

To decode the OP_RETURN data we can use the xxd library in a terminal which make a hexdump or the reverse.

echo 50726f6772616d6d61626c65206d6f6e65792046545721 | xxd -p -r

« Submarine Swap - On-chain to Off-chain Base58Check Address Encoding »