Bitcoin Core 31.0 privacy feature may expose users' IP addresses; fix slated for 31.1

A new privacy feature in Bitcoin Core 31.0 designed to prevent recipients from learning a sender's IP address can, under certain conditions, do the opposite. The issue centers on "privatebroadcast", which relies on an encrypted handshake. If that handshake fails, the node may retry by switching to a direct connection, bypassing Tor and potentially revealing the sender's IP. The failure is not purely accidental: a malicious peer can intentionally terminate the encrypted handshake to force the retry and trigger the leak. Bitcoin Core developers said the impact is limited in scope and does not affect wallet commands. A patch is expected in version 31.1. The advisory was posted quietly last week and was later amplified by @bitcoincoreorg on X last night.