Bitcoin Scripting

Team Name: CryptoKnights

Team Members:

• Janapareddy Vidya Varshini - 230041013
• Korubilli Vaishnavi - 230041016
• Mullapudi Namaswi - 230041023

Project Overview

This project demonstrates the creation and validation of Bitcoin transactions using:

1. Legacy (P2PKH) Transactions
2. SegWit (P2SH-P2WPKH) Transactions

We use Bitcoin Core (bitcoind) in regtest mode and Python scripts to interact with it via RPC calls. The project includes:

• Setting up a Bitcoin regtest network.
• Creating wallets and generating addresses.
• Funding transactions and analyzing scripts.
• Comparing transaction sizes between Legacy and SegWit formats.

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Prerequisites

Install Dependencies

Ensure you have the following installed:

1. Bitcoin Core (bitcoind & bitcoin-cli): Download Bitcoin Core
2. Python3 (if not installed, install via sudo apt install python3 or brew install python3)
3. Required Python Libraries

   pip install python-bitcoinrpc

Configure Bitcoin Core

1. Locate the bitcoin.conf file (usually found in ~/.bitcoin/bitcoin.conf on Linux/macOS or C:\Users\YourUser\AppData\Roaming\Bitcoin\bitcoin.conf on Windows).
2. Add the following configuration for regtest mode:

   regtest=1
   server=1
   rpcuser=your_rpc_user
   rpcpassword=your_rpc_password
   rpcport=18443
   txindex=1

3. Start bitcoind in regtest mode:

   bitcoind -regtest -daemon

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Running the Project

Step 1: Start Bitcoin Daemon

bitcoind -regtest -daemon

Step 2: Run the Legacy Transaction Script

python legacy_transactions.py

This will:

• Create a wallet
• Generate addresses A, B, C
• Fund address A
• Create a transaction from A → B
• Create a transaction from B → C
• Decode and analyze transactions

Step 3: Run the SegWit Transaction Script

python segwit_transactions.py

This follows the same process as above but using P2SH-SegWit addresses.

Step 4: Analyze Transactions

• Check decoded transactions in the output.
• Use Bitcoin Debugger to verify script execution.

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Expected Output

Upon running the scripts, you should see:

1. Wallet and Address Creation
2. Transaction IDs for A → B and B → C
3. Decoded Scripts (locking & unlocking mechanisms)
4. Transaction size comparison between Legacy and SegWit

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