Bitcoin Core adds safeguard against flawed PSBT signing

Bitcoin Core has implemented a safeguard to prevent signing transactions that may not bind funds to the approved payment destination. This change, merged on Sept. 25, addresses a flaw in partially signed Bitcoin transactions (PSBTs) that could allow a valid signature without protecting the intended output. The issue, highlighted by Bitcoin Optech on Oct. 2, does not expose private keys but poses a risk where a signature remains valid even if the transaction's recipient is altered under certain conditions. The flaw involves SIGHASH_SINGLE, which commits an input to a specific output position. If no output exists at that position, the protection fails differently based on the Bitcoin type used. For legacy inputs, this could lead to a signature over a fixed hash value, allowing potential reuse against other unspent outputs controlled by the same key. In contrast, SegWit v0 transactions maintain stronger protections but can still leave the destination output unbound, creating authorization issues for wallets. The new code integrates checks into Bitcoin Core's signature-creation logic, blocking affected legacy and SegWit v0 inputs from being signed while allowing other valid inputs to proceed. Users currently do not have a confirmed production release with this safeguard, as the change was only merged into the development branch.

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