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feat: opt-in v2 Argon2+HKDF encryption for multisig and MPC flows#8592

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feat: opt-in v2 Argon2+HKDF encryption for multisig and MPC flows#8592
pranavjain97 wants to merge 10 commits intomasterfrom
pranavjain/wcn-32-v2-encryption-call-sites

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@pranavjain97 pranavjain97 commented Apr 21, 2026

Summary

Wire v2 encryption (Argon2id + AES-256-GCM + HKDF session caching) into wallet creation and signing call sites across multisig, DKLS MPCv2, and EdDSA flows.

  • Opt-in via encryptionVersion: 2 on wallet/key creation
  • Signing auto-detects v1/v2 from the envelope
  • Default stays v1 -- zero breaking changes
  • decryptKeychainPrivateKey made async to support v1/v2 auto-detection in signing paths

Live Node.JS Testing (testnet)

All flows tested end-to-end on testnet with real transactions:

Operation v1 (SJCL/PBKDF2) v2 (Argon2id+HKDF) Delta
EdDSA wallet creation (tsol) 6.02s 5.53s -8%
ECDSA MPCv2 wallet creation (hteth) 8.57s 7.92s -8%
Multisig wallet creation (tbtc) 2.53s 2.43s -4%
EdDSA signing (tsol) 11.64s 11.06s -5%
ECDSA MPCv2 signing (hteth) 10.23s 11.02s +8%

v2 wallet creation is consistently faster due to HKDF session caching. Signing is roughly equivalent -- network round trips dominate.

Test plan

  • sdk-api unit tests (162 passing)
  • sdk-core unit tests (163 passing)
  • Codec validation tests for Lightning/GoAccount with encryptionVersion
  • E2e tests for DKLS and EdDSA keygen with v2 envelopes
  • Live testnet: EdDSA TSS wallet creation + signing (tsol)
  • Live testnet: ECDSA MPCv2 wallet creation + signing (hteth)
  • Live testnet: Multisig wallet creation + decrypt verification (tbtc)
  • CI

TICKET: WCN-32

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linear Bot commented Apr 21, 2026

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Wallet sharing to be done as a separate ticket.

@pranavjain97 pranavjain97 marked this pull request as ready for review April 27, 2026 16:08
@pranavjain97 pranavjain97 requested review from a team as code owners April 27, 2026 16:08
@pranavjain97 pranavjain97 changed the base branch from pranavjain/wcn-31-phase-1-hkdf-caching-layer-for-multi-call-operations to master April 27, 2026 16:10
@pranavjain97 pranavjain97 force-pushed the pranavjain/wcn-32-v2-encryption-call-sites branch from 48cfa0a to 36c78cd Compare April 27, 2026 16:12
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Review Summary

After multiple validation rounds with parallel reviewers (architect, crypto, call-site tracer, test-gap, devil's-advocate, consensus-checker), REQUEST CHANGES with two blockers and a focused set of inline comments.


Blockers

B1. No breaking-change marker on commits. None of the 7 commits on this PR carry feat!:, fix!:, or a BREAKING CHANGE: footer. lerna publish --conventional-commits (Angular preset) requires one of those for a major bump. Result: @bitgo/sdk-core will publish a minor bump despite IWallet.getUserPrv and decryptKeychainPrivateKey changing from sync string returns to Promise<string>. Downstream JS / non-strict-TS consumers will silently get a Promise where they expect a string. The repo's Check breaking changes CI job only diffs OpenAPI specs from modules/express — it does not guard SDK type signatures, so this is a code-review responsibility entirely. Fix: add a BREAKING CHANGE: footer to commit 36c78cd (or a follow-up commit) describing the async return-type change so lerna bumps sdk-core to a major version on publish.

B2. Sync v1 decrypt fan-out callers not converted, no follow-up tickets linked. A v2-encrypted wallet that flows into any of these sites hard-throws with a confusing SJCL tag-mismatch error. Blast radius is bounded today (v2 is opt-in), but every client that opts into v2 will trip at least one of these in normal usage:

  • modules/sdk-core/src/bitgo/baseCoin/baseCoin.ts:647assertIsValidKey calls sjcl.decrypt directly
  • modules/abstract-utxo/src/recovery/crossChainRecovery.ts:316 — sync decrypt(passphrase, encryptedPrv)
  • modules/sdk-core/src/bitgo/recovery/initiate.ts:112bitgo.decrypt (affects EOS/TRX/STX/XRP/UTXO backup-key recovery)
  • modules/sdk-core/src/bitgo/utils/tss/ecdsa/ecdsa.ts:567, 601 — non-MPCv2 ECDSA offline signing rounds
  • modules/sdk-core/src/bitgo/keychain/keychains.ts:170updateSingleKeychainPassword
  • modules/sdk-core/src/bitgo/keychain/keychains.ts:354-364recreateMpc (three sync decrypts)
  • modules/sdk-core/src/bitgo/trading/tradingAccount.ts:72 — OFC payload signing
  • modules/sdk-core/src/bitgo/wallet/wallets.ts (acceptShare / reshareWalletWithSpenders) — explicitly deferred per the PR comment

Fix options (any one): (a) convert each path to decryptAsync in this PR; (b) link follow-up tickets in the PR description for each path; (c) add a v2-opt-in guard at wallet creation that fails fast on these callers with a clear "v2 wallet operations require WCN-XX" error rather than letting SJCL surface a misleading tag-mismatch.


Major findings

See inline comments below.


Test coverage gap (not blocking, but please address)

The useV2 dispatch branches in createOfflineRound{1,2,3}Share (MPCv2) and getUserToBitgoCommitment / decryptRShare (EdDSA) currently have zero unit-test coverage. CI is green on the v2 dispatch only because no test exercises the branch — the live testnet runs in the PR description don't substitute for unit-level branch coverage. Please add at least one v2 signing-path test per coin family.

Separately: modules/bitgo/test/unit/decryptKeychain.ts (5 sync call sites) was not updated for the new async signature. The test runner uses tsx (no type-check), so this is not a CI break — but the assertions now run against a Promise object. Either the file silently fails to load and is skipped, or it asserts against a Promise and that's masked by the cdn=true reporter option. Either way the file no longer validates the function. Please add await and make the test functions async.


What was retracted from earlier review rounds

For the record:

  • "CI will fail to compile" — wrong; tsx strips types. The decryptKeychain test file is a silent no-op, not a build break.
  • "MPCv2 signing creates 3× Argon2id per signing" — wrong; each round is a separate HTTP request lifecycle, so cross-round session sharing is structurally impossible without server-side session storage.
  • The v2 adata drop is documented design intent per commit 22bab61c (AES-GCM is self-authenticating). The narrower remaining concern (cross-round replay binding) is captured in the inline comment on ecdsaMPCv2.ts below.

Nits

  • isV2Envelope is duplicated verbatim in ecdsaMPCv2.ts and eddsa.ts — extract to a shared util.
  • decryptAsync falls through to v1 SJCL on unknown future versions (v: 3+). Should fail closed with Error('unknown envelope version').
  • No JSDoc on EncryptOptions.adata warning that it's silently dropped when encryptionVersion: 2.

Comment thread modules/sdk-core/src/api/types.ts Outdated
Comment thread modules/sdk-core/src/bitgo/bitgoBase.ts Outdated
Comment thread modules/sdk-api/src/bitgoAPI.ts Outdated
Comment thread modules/sdk-core/src/bitgo/utils/tss/ecdsa/ecdsa.ts Outdated
Comment thread modules/sdk-core/src/bitgo/utils/tss/eddsa/eddsa.ts Outdated
Comment thread modules/sdk-core/src/bitgo/utils/tss/ecdsa/ecdsaMPCv2.ts Outdated
Comment thread modules/sdk-core/src/bitgo/wallet/iWallet.ts Outdated
Comment thread modules/sdk-core/src/bitgo/keychain/decryptKeychain.ts
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Review Summary

After multiple validation rounds with parallel reviewers (architect, crypto, call-site tracer, test-gap, devil's-advocate, consensus-checker), REQUEST CHANGES with two blockers and a focused set of inline comments.

Blockers

B1. No breaking-change marker on commits. None of the 7 commits on this PR carry feat!:, fix!:, or a BREAKING CHANGE: footer. lerna publish --conventional-commits (Angular preset) requires one of those for a major bump. Result: @bitgo/sdk-core will publish a minor bump despite IWallet.getUserPrv and decryptKeychainPrivateKey changing from sync string returns to Promise<string>. Downstream JS / non-strict-TS consumers will silently get a Promise where they expect a string. The repo's Check breaking changes CI job only diffs OpenAPI specs from modules/express — it does not guard SDK type signatures, so this is a code-review responsibility entirely. Fix: add a BREAKING CHANGE: footer to commit 36c78cd (or a follow-up commit) describing the async return-type change so lerna bumps sdk-core to a major version on publish.

B2. Sync v1 decrypt fan-out callers not converted, no follow-up tickets linked. A v2-encrypted wallet that flows into any of these sites hard-throws with a confusing SJCL tag-mismatch error. Blast radius is bounded today (v2 is opt-in), but every client that opts into v2 will trip at least one of these in normal usage:

  • modules/sdk-core/src/bitgo/baseCoin/baseCoin.ts:647assertIsValidKey calls sjcl.decrypt directly
  • modules/abstract-utxo/src/recovery/crossChainRecovery.ts:316 — sync decrypt(passphrase, encryptedPrv)
  • modules/sdk-core/src/bitgo/recovery/initiate.ts:112bitgo.decrypt (affects EOS/TRX/STX/XRP/UTXO backup-key recovery)
  • modules/sdk-core/src/bitgo/utils/tss/ecdsa/ecdsa.ts:567, 601 — non-MPCv2 ECDSA offline signing rounds
  • modules/sdk-core/src/bitgo/keychain/keychains.ts:170updateSingleKeychainPassword
  • modules/sdk-core/src/bitgo/keychain/keychains.ts:354-364recreateMpc (three sync decrypts)
  • modules/sdk-core/src/bitgo/trading/tradingAccount.ts:72 — OFC payload signing
  • modules/sdk-core/src/bitgo/wallet/wallets.ts (acceptShare / reshareWalletWithSpenders) — explicitly deferred per the PR comment

Fix options (any one): (a) convert each path to decryptAsync in this PR; (b) link follow-up tickets in the PR description for each path; (c) add a v2-opt-in guard at wallet creation that fails fast on these callers with a clear "v2 wallet operations require WCN-XX" error rather than letting SJCL surface a misleading tag-mismatch.

Major findings

See inline comments below.

Test coverage gap (not blocking, but please address)

The useV2 dispatch branches in createOfflineRound{1,2,3}Share (MPCv2) and getUserToBitgoCommitment / decryptRShare (EdDSA) currently have zero unit-test coverage. CI is green on the v2 dispatch only because no test exercises the branch — the live testnet runs in the PR description don't substitute for unit-level branch coverage. Please add at least one v2 signing-path test per coin family.

Separately: modules/bitgo/test/unit/decryptKeychain.ts (5 sync call sites) was not updated for the new async signature. The test runner uses tsx (no type-check), so this is not a CI break — but the assertions now run against a Promise object. Either the file silently fails to load and is skipped, or it asserts against a Promise and that's masked by the cdn=true reporter option. Either way the file no longer validates the function. Please add await and make the test functions async.

What was retracted from earlier review rounds

For the record:

  • "CI will fail to compile" — wrong; tsx strips types. The decryptKeychain test file is a silent no-op, not a build break.
  • "MPCv2 signing creates 3× Argon2id per signing" — wrong; each round is a separate HTTP request lifecycle, so cross-round session sharing is structurally impossible without server-side session storage.
  • The v2 adata drop is documented design intent per commit 22bab61c (AES-GCM is self-authenticating). The narrower remaining concern (cross-round replay binding) is captured in the inline comment on ecdsaMPCv2.ts below.

Nits

  • isV2Envelope is duplicated verbatim in ecdsaMPCv2.ts and eddsa.ts — extract to a shared util.
  • decryptAsync falls through to v1 SJCL on unknown future versions (v: 3+). Should fail closed with Error('unknown envelope version').
  • No JSDoc on EncryptOptions.adata warning that it's silently dropped when encryptionVersion: 2.

Great findings. Addressed all review comments across 3 commits:

  • Added EncryptionVersion type alias and IEncryptionSession interface for external consumers
  • Restored sync getUserPrv/decryptKeychainPrivateKey, added async variants -- no breaking change
  • Shared encryption session in EdDSA keygen (saves one Argon2id derivation), mirrors ecdsaMPCv2
  • Threaded AAD through the entire v2 encryption stack -- adata is stored in the v2 envelope and bound via GCM additionalData. DKLS signing passes adata to session.encrypt() and calls validateAdata() on v2 decrypt, same as v1.
  • Removed encryptionVersion from GG18 ECDSA (not in scope, tracked in WCN-283)
  • Extracted isV2Envelope to shared util, fail closed on unknown envelope version
  • Sync decrypt fan-out callers already tracked in WCN-175/269/281/282/283/284
  • Added e2e 3-round v2 signing test, AAD tamper detection tests, and fixed decryptKeychain test suite

pranavjain97 and others added 9 commits April 29, 2026 15:14
…ase/BitGoAPI

WCN-32: Adds async encryption dispatch (v1/v2 based on encryptionVersion param)
and session-based encryption to the BitGoBase interface and BitGoAPI implementation.

Co-Authored-By: Claude Opus 4.6 (1M context) <[email protected]>
…hain types

WCN-32: Thread encryptionVersion?: 2 through GenerateWalletOptions,
GenerateMpcWalletOptions, CreateMpcOptions, CreateBackupOptions,
and both Lightning/GoAccount codecs.

Co-Authored-By: Claude Opus 4.6 (1M context) <[email protected]>
…tion

WCN-32: Convert sync encrypt() to async encryptAsync() in wallet generation
and keychain creation paths. Thread encryptionVersion from GenerateWalletOptions
through Lightning, GoAccount, TSS, and onchain multisig flows.

Default remains v1. Only opt-in encryptionVersion: 2 triggers v2 encryption.

Co-Authored-By: Claude Opus 4.6 (1M context) <[email protected]>
…n and signing

WCN-32: DKLS keygen uses encryption session when encryptionVersion: 2,
signing rounds auto-detect v2 from envelope and use decryptAsync/session.
validateAdata skipped for v2 envelopes. All v1 paths unchanged.

Co-Authored-By: Claude Opus 4.6 (1M context) <[email protected]>
… signing

WCN-32: EdDSA keygen uses encryption session when encryptionVersion: 2,
signing auto-detects v2 from envelope and uses decryptAsync/session.
All v1 paths unchanged.

Co-Authored-By: Claude Opus 4.6 (1M context) <[email protected]>
WCN-32: Verify that createKeychains with encryptionVersion: 2 produces
v2 envelopes for encryptedPrv/reducedEncryptedPrv and that they are
decryptable via decryptAsync.

Co-Authored-By: Claude Opus 4.6 (1M context) <[email protected]>
…etection

WCN-32: Convert decryptKeychainPrivateKey to use decryptAsync internally
so signing flows work with both v1 and v2 encrypted keychains. Make
getUserPrv async and update all callers across sdk-core, abstract-utxo,
abstract-eth, and bitgo.

Co-Authored-By: Claude Opus 4.6 (1M context) <[email protected]>
- add EncryptionVersion type alias and IEncryptionSession interface
- restore sync getUserPrv/decryptKeychainPrivateKey, add async variants
- share encryption session in EdDSA keygen (saves one Argon2id derivation)
- extract isV2Envelope to shared util in baseTypes
- fail closed on unknown envelope version in decryptAsync
- remove encryptionVersion from GG18 ECDSA (not in scope, tracked in WCN-283)
- fix decryptKeychain tests and add async test suite

WCN-32
…ntext binding

- add optional adata param to aesGcmEncrypt/aesGcmDecrypt (GCM additionalData)
- store adata in v2 envelope, use as GCM AAD on encrypt and decrypt
- add adata param to EncryptionSession.encrypt and IEncryptionSession
- forward adata from encryptAsync to encryptV2 for v2 path
- DKLS signing: pass adata to session.encrypt, call validateAdata on v2 decrypt
- fix typesEddsaMPCv2 imports (renamed EddsaMPCv2KeyGen* to MPCv2KeyGen*)
- add AAD round-trip, tamper detection, and session adata tests

WCN-32
@pranavjain97 pranavjain97 force-pushed the pranavjain/wcn-32-v2-encryption-call-sites branch from 178ec63 to 3d25190 Compare April 29, 2026 19:19
… with adata

- e2e 3-round offline signing with v2 encrypted keys and adata context binding
- validates v2 envelopes with adata at each round boundary (round 1->2->3)
- tests validateAdata rejects mismatched adata on v2 envelopes
- fix typesEddsaMPCv2 imports (EddsaMPCv2KeyGen* -> MPCv2KeyGen*)

WCN-32
@pranavjain97 pranavjain97 force-pushed the pranavjain/wcn-32-v2-encryption-call-sites branch from 3d25190 to 4ae4ec3 Compare April 29, 2026 19:41
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