Remove fuzz channel_target.
[rust-lightning] / src / ln / channelmanager.rs
index 76c7bb18ff30be84e8b8a491622efd244e221577..d6246166bb7c3ac9ddd6f2bc2aa6d1a094750230 100644 (file)
@@ -16,9 +16,10 @@ use ln::channel::{Channel, ChannelKeys};
 use ln::channelmonitor::ManyChannelMonitor;
 use ln::router::{Route,RouteHop};
 use ln::msgs;
-use ln::msgs::{HandleError,ChannelMessageHandler,MsgEncodable,MsgDecodable};
+use ln::msgs::{HandleError,ChannelMessageHandler};
 use util::{byte_utils, events, internal_traits, rng};
 use util::sha2::Sha256;
+use util::ser::{Readable, Writeable};
 use util::chacha20poly1305rfc::ChaCha20;
 use util::logger::Logger;
 use util::errors::APIError;
@@ -32,39 +33,82 @@ use crypto::symmetriccipher::SynchronousStreamCipher;
 use std::{ptr, mem};
 use std::collections::HashMap;
 use std::collections::hash_map;
+use std::io::Cursor;
 use std::sync::{Mutex,MutexGuard,Arc};
 use std::sync::atomic::{AtomicUsize, Ordering};
 use std::time::{Instant,Duration};
 
+/// We hold various information about HTLC relay in the HTLC objects in Channel itself:
+///
+/// Upon receipt of an HTLC from a peer, we'll give it a PendingHTLCStatus indicating if it should
+/// forward the HTLC with information it will give back to us when it does so, or if it should Fail
+/// the HTLC with the relevant message for the Channel to handle giving to the remote peer.
+///
+/// When a Channel forwards an HTLC to its peer, it will give us back the PendingForwardHTLCInfo
+/// which we will use to construct an outbound HTLC, with a relevant HTLCSource::PreviousHopData
+/// filled in to indicate where it came from (which we can use to either fail-backwards or fulfill
+/// the HTLC backwards along the relevant path).
+/// Alternatively, we can fill an outbound HTLC with a HTLCSource::OutboundRoute indicating this is
+/// our payment, which we can use to decode errors or inform the user that the payment was sent.
 mod channel_held_info {
        use ln::msgs;
+       use ln::router::Route;
+       use secp256k1::key::SecretKey;
+       use secp256k1::ecdh::SharedSecret;
 
        /// Stores the info we will need to send when we want to forward an HTLC onwards
+       #[derive(Clone)] // See Channel::revoke_and_ack for why, tl;dr: Rust bug
        pub struct PendingForwardHTLCInfo {
                pub(super) onion_packet: Option<msgs::OnionPacket>,
+               pub(super) incoming_shared_secret: SharedSecret,
                pub(super) payment_hash: [u8; 32],
                pub(super) short_channel_id: u64,
-               pub(super) prev_short_channel_id: u64,
                pub(super) amt_to_forward: u64,
                pub(super) outgoing_cltv_value: u32,
        }
 
-       #[cfg(feature = "fuzztarget")]
-       impl PendingForwardHTLCInfo {
+       #[derive(Clone)] // See Channel::revoke_and_ack for why, tl;dr: Rust bug
+       pub enum HTLCFailureMsg {
+               Relay(msgs::UpdateFailHTLC),
+               Malformed(msgs::UpdateFailMalformedHTLC),
+       }
+
+       /// Stores whether we can't forward an HTLC or relevant forwarding info
+       #[derive(Clone)] // See Channel::revoke_and_ack for why, tl;dr: Rust bug
+       pub enum PendingHTLCStatus {
+               Forward(PendingForwardHTLCInfo),
+               Fail(HTLCFailureMsg),
+       }
+
+       /// Tracks the inbound corresponding to an outbound HTLC
+       #[derive(Clone)]
+       pub struct HTLCPreviousHopData {
+               pub(super) short_channel_id: u64,
+               pub(super) htlc_id: u64,
+               pub(super) incoming_packet_shared_secret: SharedSecret,
+       }
+
+       /// Tracks the inbound corresponding to an outbound HTLC
+       #[derive(Clone)]
+       pub enum HTLCSource {
+               PreviousHopData(HTLCPreviousHopData),
+               OutboundRoute {
+                       route: Route,
+                       session_priv: SecretKey,
+               },
+       }
+       #[cfg(test)]
+       impl HTLCSource {
                pub fn dummy() -> Self {
-                       Self {
-                               onion_packet: None,
-                               payment_hash: [0; 32],
-                               short_channel_id: 0,
-                               prev_short_channel_id: 0,
-                               amt_to_forward: 0,
-                               outgoing_cltv_value: 0,
+                       HTLCSource::OutboundRoute {
+                               route: Route { hops: Vec::new() },
+                               session_priv: SecretKey::from_slice(&::secp256k1::Secp256k1::without_caps(), &[1; 32]).unwrap(),
                        }
                }
        }
 
        #[derive(Clone)] // See Channel::revoke_and_ack for why, tl;dr: Rust bug
-       pub enum HTLCFailReason {
+       pub(crate) enum HTLCFailReason {
                ErrorPacket {
                        err: msgs::OnionErrorPacket,
                },
@@ -73,36 +117,51 @@ mod channel_held_info {
                        data: Vec<u8>,
                }
        }
+}
+pub(super) use self::channel_held_info::*;
 
-       #[cfg(feature = "fuzztarget")]
-       impl HTLCFailReason {
-               pub fn dummy() -> Self {
-                       HTLCFailReason::Reason {
-                               failure_code: 0, data: Vec::new(),
-                       }
+struct MsgHandleErrInternal {
+       err: msgs::HandleError,
+       needs_channel_force_close: bool,
+}
+impl MsgHandleErrInternal {
+       #[inline]
+       fn send_err_msg_no_close(err: &'static str, channel_id: [u8; 32]) -> Self {
+               Self {
+                       err: HandleError {
+                               err,
+                               action: Some(msgs::ErrorAction::SendErrorMessage {
+                                       msg: msgs::ErrorMessage {
+                                               channel_id,
+                                               data: err.to_string()
+                                       },
+                               }),
+                       },
+                       needs_channel_force_close: false,
                }
        }
-}
-#[cfg(feature = "fuzztarget")]
-pub use self::channel_held_info::*;
-#[cfg(not(feature = "fuzztarget"))]
-pub(crate) use self::channel_held_info::*;
-
-enum PendingOutboundHTLC {
-       IntermediaryHopData {
-               source_short_channel_id: u64,
-               incoming_packet_shared_secret: SharedSecret,
-       },
-       OutboundRoute {
-               route: Route,
-               session_priv: SecretKey,
-       },
-       /// Used for channel rebalancing
-       CycledRoute {
-               source_short_channel_id: u64,
-               incoming_packet_shared_secret: SharedSecret,
-               route: Route,
-               session_priv: SecretKey,
+       #[inline]
+       fn send_err_msg_close_chan(err: &'static str, channel_id: [u8; 32]) -> Self {
+               Self {
+                       err: HandleError {
+                               err,
+                               action: Some(msgs::ErrorAction::SendErrorMessage {
+                                       msg: msgs::ErrorMessage {
+                                               channel_id,
+                                               data: err.to_string()
+                                       },
+                               }),
+                       },
+                       needs_channel_force_close: true,
+               }
+       }
+       #[inline]
+       fn from_maybe_close(err: msgs::HandleError) -> Self {
+               Self { err, needs_channel_force_close: true }
+       }
+       #[inline]
+       fn from_no_close(err: msgs::HandleError) -> Self {
+               Self { err, needs_channel_force_close: false }
        }
 }
 
@@ -112,6 +171,12 @@ enum PendingOutboundHTLC {
 /// probably increase this significantly.
 const MIN_HTLC_RELAY_HOLDING_CELL_MILLIS: u32 = 50;
 
+struct HTLCForwardInfo {
+       prev_short_channel_id: u64,
+       prev_htlc_id: u64,
+       forward_info: PendingForwardHTLCInfo,
+}
+
 struct ChannelHolder {
        by_id: HashMap<[u8; 32], Channel>,
        short_to_id: HashMap<u64, [u8; 32]>,
@@ -120,18 +185,18 @@ struct ChannelHolder {
        /// Note that while this is held in the same mutex as the channels themselves, no consistency
        /// guarantees are made about there existing a channel with the short id here, nor the short
        /// ids in the PendingForwardHTLCInfo!
-       forward_htlcs: HashMap<u64, Vec<PendingForwardHTLCInfo>>,
+       forward_htlcs: HashMap<u64, Vec<HTLCForwardInfo>>,
        /// Note that while this is held in the same mutex as the channels themselves, no consistency
        /// guarantees are made about the channels given here actually existing anymore by the time you
        /// go to read them!
-       claimable_htlcs: HashMap<[u8; 32], PendingOutboundHTLC>,
+       claimable_htlcs: HashMap<[u8; 32], Vec<HTLCPreviousHopData>>,
 }
 struct MutChannelHolder<'a> {
        by_id: &'a mut HashMap<[u8; 32], Channel>,
        short_to_id: &'a mut HashMap<u64, [u8; 32]>,
        next_forward: &'a mut Instant,
-       forward_htlcs: &'a mut HashMap<u64, Vec<PendingForwardHTLCInfo>>,
-       claimable_htlcs: &'a mut HashMap<[u8; 32], PendingOutboundHTLC>,
+       forward_htlcs: &'a mut HashMap<u64, Vec<HTLCForwardInfo>>,
+       claimable_htlcs: &'a mut HashMap<[u8; 32], Vec<HTLCPreviousHopData>>,
 }
 impl ChannelHolder {
        fn borrow_parts(&mut self) -> MutChannelHolder {
@@ -175,11 +240,10 @@ pub struct ChannelManager {
 const CLTV_EXPIRY_DELTA: u16 = 6 * 24 * 2; //TODO?
 
 macro_rules! secp_call {
-       ( $res : expr ) => {
+       ( $res: expr, $err: expr ) => {
                match $res {
                        Ok(key) => key,
-                       //TODO: Make the err a parameter!
-                       Err(_) => return Err(HandleError{err: "Key error", action: None})
+                       Err(_) => return Err($err),
                }
        };
 }
@@ -278,7 +342,7 @@ impl ChannelManager {
                };
 
                let channel = Channel::new_outbound(&*self.fee_estimator, chan_keys, their_network_key, channel_value_satoshis, push_msat, self.announce_channels_publicly, user_id, Arc::clone(&self.logger))?;
-               let res = channel.get_open_channel(self.genesis_hash.clone(), &*self.fee_estimator)?;
+               let res = channel.get_open_channel(self.genesis_hash.clone(), &*self.fee_estimator);
                let mut channel_state = self.channel_state.lock().unwrap();
                match channel_state.by_id.insert(channel.channel_id(), channel) {
                        Some(_) => panic!("RNG is bad???"),
@@ -334,7 +398,7 @@ impl ChannelManager {
        /// pending HTLCs, the channel will be closed on chain.
        /// May generate a SendShutdown event on success, which should be relayed.
        pub fn close_channel(&self, channel_id: &[u8; 32]) -> Result<(), HandleError> {
-               let (res, node_id, chan_option) = {
+               let (mut res, node_id, chan_option) = {
                        let mut channel_state_lock = self.channel_state.lock().unwrap();
                        let channel_state = channel_state_lock.borrow_parts();
                        match channel_state.by_id.entry(channel_id.clone()) {
@@ -350,9 +414,9 @@ impl ChannelManager {
                                hash_map::Entry::Vacant(_) => return Err(HandleError{err: "No such channel", action: None})
                        }
                };
-               for payment_hash in res.1 {
+               for htlc_source in res.1.drain(..) {
                        // unknown_next_peer...I dunno who that is anymore....
-                       self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), &payment_hash, HTLCFailReason::Reason { failure_code: 0x4000 | 10, data: Vec::new() });
+                       self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), htlc_source.0, &htlc_source.1, HTLCFailReason::Reason { failure_code: 0x4000 | 10, data: Vec::new() });
                }
                let chan_update = if let Some(chan) = chan_option {
                        if let Ok(update) = self.get_channel_update(&chan) {
@@ -375,11 +439,11 @@ impl ChannelManager {
        }
 
        #[inline]
-       fn finish_force_close_channel(&self, shutdown_res: (Vec<Transaction>, Vec<[u8; 32]>)) {
-               let (local_txn, failed_htlcs) = shutdown_res;
-               for payment_hash in failed_htlcs {
+       fn finish_force_close_channel(&self, shutdown_res: (Vec<Transaction>, Vec<(HTLCSource, [u8; 32])>)) {
+               let (local_txn, mut failed_htlcs) = shutdown_res;
+               for htlc_source in failed_htlcs.drain(..) {
                        // unknown_next_peer...I dunno who that is anymore....
-                       self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), &payment_hash, HTLCFailReason::Reason { failure_code: 0x4000 | 10, data: Vec::new() });
+                       self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), htlc_source.0, &htlc_source.1, HTLCFailReason::Reason { failure_code: 0x4000 | 10, data: Vec::new() });
                }
                for tx in local_txn {
                        self.tx_broadcaster.broadcast_transaction(&tx);
@@ -389,6 +453,8 @@ impl ChannelManager {
                //TODO: We need to handle monitoring of pending offered HTLCs which just hit the chain and
                //may be claimed, resulting in us claiming the inbound HTLCs (and back-failing after
                //timeouts are hit and our claims confirm).
+               //TODO: In any case, we need to make sure we remove any pending htlc tracking (via
+               //fail_backwards or claim_funds) eventually for all HTLCs that were in the channel
        }
 
        /// Force closes a channel, immediately broadcasting the latest local commitment transaction to
@@ -461,10 +527,9 @@ impl ChannelManager {
 
        // can only fail if an intermediary hop has an invalid public key or session_priv is invalid
        #[inline]
-       fn construct_onion_keys_callback<T: secp256k1::Signing, FType: FnMut(SharedSecret, [u8; 32], PublicKey, &RouteHop)> (secp_ctx: &Secp256k1<T>, route: &Route, session_priv: &SecretKey, mut callback: FType) -> Result<(), HandleError> {
+       fn construct_onion_keys_callback<T: secp256k1::Signing, FType: FnMut(SharedSecret, [u8; 32], PublicKey, &RouteHop)> (secp_ctx: &Secp256k1<T>, route: &Route, session_priv: &SecretKey, mut callback: FType) -> Result<(), secp256k1::Error> {
                let mut blinded_priv = session_priv.clone();
                let mut blinded_pub = PublicKey::from_secret_key(secp_ctx, &blinded_priv);
-               let mut first_iteration = true;
 
                for hop in route.hops.iter() {
                        let shared_secret = SharedSecret::new(secp_ctx, &hop.pubkey, &blinded_priv);
@@ -475,13 +540,9 @@ impl ChannelManager {
                        let mut blinding_factor = [0u8; 32];
                        sha.result(&mut blinding_factor);
 
-                       if first_iteration {
-                               blinded_pub = PublicKey::from_secret_key(secp_ctx, &blinded_priv);
-                               first_iteration = false;
-                       }
                        let ephemeral_pubkey = blinded_pub;
 
-                       secp_call!(blinded_priv.mul_assign(secp_ctx, &secp_call!(SecretKey::from_slice(secp_ctx, &blinding_factor))));
+                       blinded_priv.mul_assign(secp_ctx, &SecretKey::from_slice(secp_ctx, &blinding_factor)?)?;
                        blinded_pub = PublicKey::from_secret_key(secp_ctx, &blinded_priv);
 
                        callback(shared_secret, blinding_factor, ephemeral_pubkey, hop);
@@ -491,7 +552,7 @@ impl ChannelManager {
        }
 
        // can only fail if an intermediary hop has an invalid public key or session_priv is invalid
-       fn construct_onion_keys<T: secp256k1::Signing>(secp_ctx: &Secp256k1<T>, route: &Route, session_priv: &SecretKey) -> Result<Vec<OnionKeys>, HandleError> {
+       fn construct_onion_keys<T: secp256k1::Signing>(secp_ctx: &Secp256k1<T>, route: &Route, session_priv: &SecretKey) -> Result<Vec<OnionKeys>, secp256k1::Error> {
                let mut res = Vec::with_capacity(route.hops.len());
 
                Self::construct_onion_keys_callback(secp_ctx, route, session_priv, |shared_secret, _blinding_factor, ephemeral_pubkey, _| {
@@ -512,7 +573,7 @@ impl ChannelManager {
        }
 
        /// returns the hop data, as well as the first-hop value_msat and CLTV value we should send.
-       fn build_onion_payloads(route: &Route, starting_htlc_offset: u32) -> Result<(Vec<msgs::OnionHopData>, u64, u32), HandleError> {
+       fn build_onion_payloads(route: &Route, starting_htlc_offset: u32) -> Result<(Vec<msgs::OnionHopData>, u64, u32), APIError> {
                let mut cur_value_msat = 0u64;
                let mut cur_cltv = starting_htlc_offset;
                let mut last_short_channel_id = 0;
@@ -537,11 +598,11 @@ impl ChannelManager {
                        };
                        cur_value_msat += hop.fee_msat;
                        if cur_value_msat >= 21000000 * 100000000 * 1000 {
-                               return Err(HandleError{err: "Channel fees overflowed?!", action: None});
+                               return Err(APIError::RouteError{err: "Channel fees overflowed?!"});
                        }
                        cur_cltv += hop.cltv_expiry_delta as u32;
                        if cur_cltv >= 500000000 {
-                               return Err(HandleError{err: "Channel CLTV overflowed?!", action: None});
+                               return Err(APIError::RouteError{err: "Channel CLTV overflowed?!"});
                        }
                        last_short_channel_id = hop.short_channel_id;
                }
@@ -568,7 +629,7 @@ impl ChannelManager {
        }
 
        const ZERO:[u8; 21*65] = [0; 21*65];
-       fn construct_onion_packet(mut payloads: Vec<msgs::OnionHopData>, onion_keys: Vec<OnionKeys>, associated_data: &[u8; 32]) -> Result<msgs::OnionPacket, HandleError> {
+       fn construct_onion_packet(mut payloads: Vec<msgs::OnionHopData>, onion_keys: Vec<OnionKeys>, associated_data: &[u8; 32]) -> msgs::OnionPacket {
                let mut buf = Vec::with_capacity(21*65);
                buf.resize(21*65, 0);
 
@@ -609,12 +670,12 @@ impl ChannelManager {
                        hmac.raw_result(&mut hmac_res);
                }
 
-               Ok(msgs::OnionPacket{
+               msgs::OnionPacket{
                        version: 0,
-                       public_key: onion_keys.first().unwrap().ephemeral_pubkey,
+                       public_key: Ok(onion_keys.first().unwrap().ephemeral_pubkey),
                        hop_data: packet_data,
                        hmac: hmac_res,
-               })
+               }
        }
 
        /// Encrypts a failure packet. raw_packet can either be a
@@ -667,6 +728,183 @@ impl ChannelManager {
                ChannelManager::encrypt_failure_packet(shared_secret, &failure_packet.encode()[..])
        }
 
+       fn decode_update_add_htlc_onion(&self, msg: &msgs::UpdateAddHTLC) -> (PendingHTLCStatus, MutexGuard<ChannelHolder>) {
+               macro_rules! get_onion_hash {
+                       () => {
+                               {
+                                       let mut sha = Sha256::new();
+                                       sha.input(&msg.onion_routing_packet.hop_data);
+                                       let mut onion_hash = [0; 32];
+                                       sha.result(&mut onion_hash);
+                                       onion_hash
+                               }
+                       }
+               }
+
+               if let Err(_) = msg.onion_routing_packet.public_key {
+                       log_info!(self, "Failed to accept/forward incoming HTLC with invalid ephemeral pubkey");
+                       return (PendingHTLCStatus::Fail(HTLCFailureMsg::Malformed(msgs::UpdateFailMalformedHTLC {
+                               channel_id: msg.channel_id,
+                               htlc_id: msg.htlc_id,
+                               sha256_of_onion: get_onion_hash!(),
+                               failure_code: 0x8000 | 0x4000 | 6,
+                       })), self.channel_state.lock().unwrap());
+               }
+
+               let shared_secret = SharedSecret::new(&self.secp_ctx, &msg.onion_routing_packet.public_key.unwrap(), &self.our_network_key);
+               let (rho, mu) = ChannelManager::gen_rho_mu_from_shared_secret(&shared_secret);
+
+               let mut channel_state = None;
+               macro_rules! return_err {
+                       ($msg: expr, $err_code: expr, $data: expr) => {
+                               {
+                                       log_info!(self, "Failed to accept/forward incoming HTLC: {}", $msg);
+                                       if channel_state.is_none() {
+                                               channel_state = Some(self.channel_state.lock().unwrap());
+                                       }
+                                       return (PendingHTLCStatus::Fail(HTLCFailureMsg::Relay(msgs::UpdateFailHTLC {
+                                               channel_id: msg.channel_id,
+                                               htlc_id: msg.htlc_id,
+                                               reason: ChannelManager::build_first_hop_failure_packet(&shared_secret, $err_code, $data),
+                                       })), channel_state.unwrap());
+                               }
+                       }
+               }
+
+               if msg.onion_routing_packet.version != 0 {
+                       //TODO: Spec doesn't indicate if we should only hash hop_data here (and in other
+                       //sha256_of_onion error data packets), or the entire onion_routing_packet. Either way,
+                       //the hash doesn't really serve any purpuse - in the case of hashing all data, the
+                       //receiving node would have to brute force to figure out which version was put in the
+                       //packet by the node that send us the message, in the case of hashing the hop_data, the
+                       //node knows the HMAC matched, so they already know what is there...
+                       return_err!("Unknown onion packet version", 0x8000 | 0x4000 | 4, &get_onion_hash!());
+               }
+
+               let mut hmac = Hmac::new(Sha256::new(), &mu);
+               hmac.input(&msg.onion_routing_packet.hop_data);
+               hmac.input(&msg.payment_hash);
+               if hmac.result() != MacResult::new(&msg.onion_routing_packet.hmac) {
+                       return_err!("HMAC Check failed", 0x8000 | 0x4000 | 5, &get_onion_hash!());
+               }
+
+               let mut chacha = ChaCha20::new(&rho, &[0u8; 8]);
+               let next_hop_data = {
+                       let mut decoded = [0; 65];
+                       chacha.process(&msg.onion_routing_packet.hop_data[0..65], &mut decoded);
+                       match msgs::OnionHopData::read(&mut Cursor::new(&decoded[..])) {
+                               Err(err) => {
+                                       let error_code = match err {
+                                               msgs::DecodeError::UnknownRealmByte => 0x4000 | 1,
+                                               _ => 0x2000 | 2, // Should never happen
+                                       };
+                                       return_err!("Unable to decode our hop data", error_code, &[0;0]);
+                               },
+                               Ok(msg) => msg
+                       }
+               };
+
+               //TODO: Check that msg.cltv_expiry is within acceptable bounds!
+
+               let pending_forward_info = if next_hop_data.hmac == [0; 32] {
+                               // OUR PAYMENT!
+                               if next_hop_data.data.amt_to_forward != msg.amount_msat {
+                                       return_err!("Upstream node sent less than we were supposed to receive in payment", 19, &byte_utils::be64_to_array(msg.amount_msat));
+                               }
+                               if next_hop_data.data.outgoing_cltv_value != msg.cltv_expiry {
+                                       return_err!("Upstream node set CLTV to the wrong value", 18, &byte_utils::be32_to_array(msg.cltv_expiry));
+                               }
+
+                               // Note that we could obviously respond immediately with an update_fulfill_htlc
+                               // message, however that would leak that we are the recipient of this payment, so
+                               // instead we stay symmetric with the forwarding case, only responding (after a
+                               // delay) once they've send us a commitment_signed!
+
+                               PendingHTLCStatus::Forward(PendingForwardHTLCInfo {
+                                       onion_packet: None,
+                                       payment_hash: msg.payment_hash.clone(),
+                                       short_channel_id: 0,
+                                       incoming_shared_secret: shared_secret.clone(),
+                                       amt_to_forward: next_hop_data.data.amt_to_forward,
+                                       outgoing_cltv_value: next_hop_data.data.outgoing_cltv_value,
+                               })
+                       } else {
+                               let mut new_packet_data = [0; 20*65];
+                               chacha.process(&msg.onion_routing_packet.hop_data[65..], &mut new_packet_data[0..19*65]);
+                               chacha.process(&ChannelManager::ZERO[0..65], &mut new_packet_data[19*65..]);
+
+                               let mut new_pubkey = msg.onion_routing_packet.public_key.unwrap();
+
+                               let blinding_factor = {
+                                       let mut sha = Sha256::new();
+                                       sha.input(&new_pubkey.serialize()[..]);
+                                       sha.input(&shared_secret[..]);
+                                       let mut res = [0u8; 32];
+                                       sha.result(&mut res);
+                                       match SecretKey::from_slice(&self.secp_ctx, &res) {
+                                               Err(_) => {
+                                                       return_err!("Blinding factor is an invalid private key", 0x8000 | 0x4000 | 6, &get_onion_hash!());
+                                               },
+                                               Ok(key) => key
+                                       }
+                               };
+
+                               if let Err(_) = new_pubkey.mul_assign(&self.secp_ctx, &blinding_factor) {
+                                       return_err!("New blinding factor is an invalid private key", 0x8000 | 0x4000 | 6, &get_onion_hash!());
+                               }
+
+                               let outgoing_packet = msgs::OnionPacket {
+                                       version: 0,
+                                       public_key: Ok(new_pubkey),
+                                       hop_data: new_packet_data,
+                                       hmac: next_hop_data.hmac.clone(),
+                               };
+
+                               PendingHTLCStatus::Forward(PendingForwardHTLCInfo {
+                                       onion_packet: Some(outgoing_packet),
+                                       payment_hash: msg.payment_hash.clone(),
+                                       short_channel_id: next_hop_data.data.short_channel_id,
+                                       incoming_shared_secret: shared_secret.clone(),
+                                       amt_to_forward: next_hop_data.data.amt_to_forward,
+                                       outgoing_cltv_value: next_hop_data.data.outgoing_cltv_value,
+                               })
+                       };
+
+               channel_state = Some(self.channel_state.lock().unwrap());
+               if let &PendingHTLCStatus::Forward(PendingForwardHTLCInfo { ref onion_packet, ref short_channel_id, ref amt_to_forward, ref outgoing_cltv_value, .. }) = &pending_forward_info {
+                       if onion_packet.is_some() { // If short_channel_id is 0 here, we'll reject them in the body here
+                               let id_option = channel_state.as_ref().unwrap().short_to_id.get(&short_channel_id).cloned();
+                               let forwarding_id = match id_option {
+                                       None => {
+                                               return_err!("Don't have available channel for forwarding as requested.", 0x4000 | 10, &[0;0]);
+                                       },
+                                       Some(id) => id.clone(),
+                               };
+                               if let Some((err, code, chan_update)) = {
+                                       let chan = channel_state.as_mut().unwrap().by_id.get_mut(&forwarding_id).unwrap();
+                                       if !chan.is_live() {
+                                               Some(("Forwarding channel is not in a ready state.", 0x1000 | 7, self.get_channel_update(chan).unwrap()))
+                                       } else {
+                                               let fee = amt_to_forward.checked_mul(self.fee_proportional_millionths as u64).and_then(|prop_fee| { (prop_fee / 1000000).checked_add(chan.get_our_fee_base_msat(&*self.fee_estimator) as u64) });
+                                               if fee.is_none() || msg.amount_msat < fee.unwrap() || (msg.amount_msat - fee.unwrap()) < *amt_to_forward {
+                                                       Some(("Prior hop has deviated from specified fees parameters or origin node has obsolete ones", 0x1000 | 12, self.get_channel_update(chan).unwrap()))
+                                               } else {
+                                                       if (msg.cltv_expiry as u64) < (*outgoing_cltv_value) as u64 + CLTV_EXPIRY_DELTA as u64 {
+                                                               Some(("Forwarding node has tampered with the intended HTLC values or origin node has an obsolete cltv_expiry_delta", 0x1000 | 13, self.get_channel_update(chan).unwrap()))
+                                                       } else {
+                                                               None
+                                                       }
+                                               }
+                                       }
+                               } {
+                                       return_err!(err, code, &chan_update.encode_with_len()[..]);
+                               }
+                       }
+               }
+
+               (pending_forward_info, channel_state.unwrap())
+       }
+
        /// only fails if the channel does not yet have an assigned short_id
        fn get_channel_update(&self, chan: &Channel) -> Result<msgs::ChannelUpdate, HandleError> {
                let short_channel_id = match chan.get_short_channel_id() {
@@ -685,6 +923,7 @@ impl ChannelManager {
                        htlc_minimum_msat: chan.get_our_htlc_minimum_msat(),
                        fee_base_msat: chan.get_our_fee_base_msat(&*self.fee_estimator),
                        fee_proportional_millionths: self.fee_proportional_millionths,
+                       excess_data: Vec::new(),
                };
 
                let msg_hash = Sha256dHash::from_data(&unsigned.encode()[..]);
@@ -707,58 +946,57 @@ impl ChannelManager {
        /// payment") and prevent double-sends yourself.
        /// See-also docs on Channel::send_htlc_and_commit.
        /// May generate a SendHTLCs event on success, which should be relayed.
-       pub fn send_payment(&self, route: Route, payment_hash: [u8; 32]) -> Result<(), HandleError> {
+       /// Raises APIError::RoutError when invalid route or forward parameter
+       /// (cltv_delta, fee, node public key) is specified
+       pub fn send_payment(&self, route: Route, payment_hash: [u8; 32]) -> Result<(), APIError> {
                if route.hops.len() < 1 || route.hops.len() > 20 {
-                       return Err(HandleError{err: "Route didn't go anywhere/had bogus size", action: None});
+                       return Err(APIError::RouteError{err: "Route didn't go anywhere/had bogus size"});
                }
                let our_node_id = self.get_our_node_id();
                for (idx, hop) in route.hops.iter().enumerate() {
                        if idx != route.hops.len() - 1 && hop.pubkey == our_node_id {
-                               return Err(HandleError{err: "Route went through us but wasn't a simple rebalance loop to us", action: None});
+                               return Err(APIError::RouteError{err: "Route went through us but wasn't a simple rebalance loop to us"});
                        }
                }
 
-               let session_priv = secp_call!(SecretKey::from_slice(&self.secp_ctx, &{
+               let session_priv = SecretKey::from_slice(&self.secp_ctx, &{
                        let mut session_key = [0; 32];
                        rng::fill_bytes(&mut session_key);
                        session_key
-               }));
+               }).expect("RNG is bad!");
 
                let cur_height = self.latest_block_height.load(Ordering::Acquire) as u32 + 1;
 
-               let onion_keys = ChannelManager::construct_onion_keys(&self.secp_ctx, &route, &session_priv)?;
+               let onion_keys = secp_call!(ChannelManager::construct_onion_keys(&self.secp_ctx, &route, &session_priv),
+                               APIError::RouteError{err: "Pubkey along hop was maliciously selected"});
                let (onion_payloads, htlc_msat, htlc_cltv) = ChannelManager::build_onion_payloads(&route, cur_height)?;
-               let onion_packet = ChannelManager::construct_onion_packet(onion_payloads, onion_keys, &payment_hash)?;
+               let onion_packet = ChannelManager::construct_onion_packet(onion_payloads, onion_keys, &payment_hash);
 
                let (first_hop_node_id, (update_add, commitment_signed, chan_monitor)) = {
                        let mut channel_state_lock = self.channel_state.lock().unwrap();
                        let channel_state = channel_state_lock.borrow_parts();
 
                        let id = match channel_state.short_to_id.get(&route.hops.first().unwrap().short_channel_id) {
-                               None => return Err(HandleError{err: "No channel available with first hop!", action: None}),
-                               Some(id) => id.clone()
+                               None => return Err(APIError::RouteError{err: "No channel available with first hop!"}),
+                               Some(id) => id.clone(),
                        };
 
-                       let claimable_htlc_entry = channel_state.claimable_htlcs.entry(payment_hash.clone());
-                       if let hash_map::Entry::Occupied(_) = claimable_htlc_entry {
-                               return Err(HandleError{err: "Already had pending HTLC with the same payment_hash", action: None});
-                       }
-
                        let res = {
                                let chan = channel_state.by_id.get_mut(&id).unwrap();
                                if chan.get_their_node_id() != route.hops.first().unwrap().pubkey {
-                                       return Err(HandleError{err: "Node ID mismatch on first hop!", action: None});
+                                       return Err(APIError::RouteError{err: "Node ID mismatch on first hop!"});
                                }
-                               chan.send_htlc_and_commit(htlc_msat, payment_hash, htlc_cltv, onion_packet)?
+                               if !chan.is_live() {
+                                       return Err(APIError::RouteError{err: "Peer for first hop currently disconnected!"});
+                               }
+                               chan.send_htlc_and_commit(htlc_msat, payment_hash.clone(), htlc_cltv, HTLCSource::OutboundRoute {
+                                       route: route.clone(),
+                                       session_priv: session_priv.clone(),
+                               }, onion_packet).map_err(|he| APIError::RouteError{err: he.err})?
                        };
 
                        let first_hop_node_id = route.hops.first().unwrap().pubkey;
 
-                       claimable_htlc_entry.or_insert(PendingOutboundHTLC::OutboundRoute {
-                               route,
-                               session_priv,
-                       });
-
                        match res {
                                Some(msgs) => (first_hop_node_id, msgs),
                                None => return Ok(()),
@@ -766,14 +1004,19 @@ impl ChannelManager {
                };
 
                if let Err(_e) = self.monitor.add_update_monitor(chan_monitor.get_funding_txo().unwrap(), chan_monitor) {
-                       unimplemented!(); // maybe remove from claimable_htlcs?
+                       unimplemented!();
                }
 
                let mut events = self.pending_events.lock().unwrap();
-               events.push(events::Event::SendHTLCs {
+               events.push(events::Event::UpdateHTLCs {
                        node_id: first_hop_node_id,
-                       msgs: vec![update_add],
-                       commitment_msg: commitment_signed,
+                       updates: msgs::CommitmentUpdate {
+                               update_add_htlcs: vec![update_add],
+                               update_fulfill_htlcs: Vec::new(),
+                               update_fail_htlcs: Vec::new(),
+                               update_fail_malformed_htlcs: Vec::new(),
+                               commitment_signed,
+                       },
                });
                Ok(())
        }
@@ -816,7 +1059,7 @@ impl ChannelManager {
                        }
                }; // Release channel lock for install_watch_outpoint call,
                if let Err(_e) = self.monitor.add_update_monitor(chan_monitor.get_funding_txo().unwrap(), chan_monitor) {
-                       unimplemented!(); // maybe remove from claimable_htlcs?
+                       unimplemented!();
                }
                add_pending_event!(events::Event::SendFundingCreated {
                        node_id: chan.get_their_node_id(),
@@ -834,19 +1077,22 @@ impl ChannelManager {
                }
        }
 
-       fn get_announcement_sigs(&self, chan: &Channel) -> Result<Option<msgs::AnnouncementSignatures>, HandleError> {
-               if !chan.is_usable() || !chan.should_announce() { return Ok(None) }
+       fn get_announcement_sigs(&self, chan: &Channel) -> Option<msgs::AnnouncementSignatures> {
+               if !chan.should_announce() { return None }
 
-               let (announcement, our_bitcoin_sig) = chan.get_channel_announcement(self.get_our_node_id(), self.genesis_hash.clone())?;
+               let (announcement, our_bitcoin_sig) = match chan.get_channel_announcement(self.get_our_node_id(), self.genesis_hash.clone()) {
+                       Ok(res) => res,
+                       Err(_) => return None, // Only in case of state precondition violations eg channel is closing
+               };
                let msghash = Message::from_slice(&Sha256dHash::from_data(&announcement.encode()[..])[..]).unwrap();
                let our_node_sig = self.secp_ctx.sign(&msghash, &self.our_network_key);
 
-               Ok(Some(msgs::AnnouncementSignatures {
+               Some(msgs::AnnouncementSignatures {
                        channel_id: chan.channel_id(),
                        short_channel_id: chan.get_short_channel_id().unwrap(),
                        node_signature: our_node_sig,
                        bitcoin_signature: our_bitcoin_sig,
-               }))
+               })
        }
 
        /// Processes HTLCs which are pending waiting on random forward delay.
@@ -863,14 +1109,19 @@ impl ChannelManager {
                                return;
                        }
 
-                       for (short_chan_id, pending_forwards) in channel_state.forward_htlcs.drain() {
+                       for (short_chan_id, mut pending_forwards) in channel_state.forward_htlcs.drain() {
                                if short_chan_id != 0 {
                                        let forward_chan_id = match channel_state.short_to_id.get(&short_chan_id) {
                                                Some(chan_id) => chan_id.clone(),
                                                None => {
                                                        failed_forwards.reserve(pending_forwards.len());
-                                                       for forward_info in pending_forwards {
-                                                               failed_forwards.push((forward_info.payment_hash, 0x4000 | 10, None));
+                                                       for HTLCForwardInfo { prev_short_channel_id, prev_htlc_id, forward_info } in pending_forwards.drain(..) {
+                                                               let htlc_source = HTLCSource::PreviousHopData(HTLCPreviousHopData {
+                                                                       short_channel_id: prev_short_channel_id,
+                                                                       htlc_id: prev_htlc_id,
+                                                                       incoming_packet_shared_secret: forward_info.incoming_shared_secret,
+                                                               });
+                                                               failed_forwards.push((htlc_source, forward_info.payment_hash, 0x4000 | 10, None));
                                                        }
                                                        continue;
                                                }
@@ -878,11 +1129,16 @@ impl ChannelManager {
                                        let forward_chan = &mut channel_state.by_id.get_mut(&forward_chan_id).unwrap();
 
                                        let mut add_htlc_msgs = Vec::new();
-                                       for forward_info in pending_forwards {
-                                               match forward_chan.send_htlc(forward_info.amt_to_forward, forward_info.payment_hash, forward_info.outgoing_cltv_value, forward_info.onion_packet.unwrap()) {
+                                       for HTLCForwardInfo { prev_short_channel_id, prev_htlc_id, forward_info } in pending_forwards.drain(..) {
+                                               let htlc_source = HTLCSource::PreviousHopData(HTLCPreviousHopData {
+                                                       short_channel_id: prev_short_channel_id,
+                                                       htlc_id: prev_htlc_id,
+                                                       incoming_packet_shared_secret: forward_info.incoming_shared_secret,
+                                               });
+                                               match forward_chan.send_htlc(forward_info.amt_to_forward, forward_info.payment_hash, forward_info.outgoing_cltv_value, htlc_source.clone(), forward_info.onion_packet.unwrap()) {
                                                        Err(_e) => {
                                                                let chan_update = self.get_channel_update(forward_chan).unwrap();
-                                                               failed_forwards.push((forward_info.payment_hash, 0x1000 | 7, Some(chan_update)));
+                                                               failed_forwards.push((htlc_source, forward_info.payment_hash, 0x1000 | 7, Some(chan_update)));
                                                                continue;
                                                        },
                                                        Ok(update_add) => {
@@ -905,19 +1161,38 @@ impl ChannelManager {
                                        if !add_htlc_msgs.is_empty() {
                                                let (commitment_msg, monitor) = match forward_chan.send_commitment() {
                                                        Ok(res) => res,
-                                                       Err(_e) => {
+                                                       Err(e) => {
+                                                               if let &Some(msgs::ErrorAction::DisconnectPeer{msg: Some(ref _err_msg)}) = &e.action {
+                                                               } else if let &Some(msgs::ErrorAction::SendErrorMessage{msg: ref _err_msg}) = &e.action {
+                                                               } else {
+                                                                       panic!("Stated return value requirements in send_commitment() were not met");
+                                                               }
                                                                //TODO: Handle...this is bad!
                                                                continue;
                                                        },
                                                };
-                                               new_events.push((Some(monitor), events::Event::SendHTLCs {
+                                               new_events.push((Some(monitor), events::Event::UpdateHTLCs {
                                                        node_id: forward_chan.get_their_node_id(),
-                                                       msgs: add_htlc_msgs,
-                                                       commitment_msg: commitment_msg,
+                                                       updates: msgs::CommitmentUpdate {
+                                                               update_add_htlcs: add_htlc_msgs,
+                                                               update_fulfill_htlcs: Vec::new(),
+                                                               update_fail_htlcs: Vec::new(),
+                                                               update_fail_malformed_htlcs: Vec::new(),
+                                                               commitment_signed: commitment_msg,
+                                                       },
                                                }));
                                        }
                                } else {
-                                       for forward_info in pending_forwards {
+                                       for HTLCForwardInfo { prev_short_channel_id, prev_htlc_id, forward_info } in pending_forwards.drain(..) {
+                                               let prev_hop_data = HTLCPreviousHopData {
+                                                       short_channel_id: prev_short_channel_id,
+                                                       htlc_id: prev_htlc_id,
+                                                       incoming_packet_shared_secret: forward_info.incoming_shared_secret,
+                                               };
+                                               match channel_state.claimable_htlcs.entry(forward_info.payment_hash) {
+                                                       hash_map::Entry::Occupied(mut entry) => entry.get_mut().push(prev_hop_data),
+                                                       hash_map::Entry::Vacant(entry) => { entry.insert(vec![prev_hop_data]); },
+                                               };
                                                new_events.push((None, events::Event::PaymentReceived {
                                                        payment_hash: forward_info.payment_hash,
                                                        amt: forward_info.amt_to_forward,
@@ -927,10 +1202,10 @@ impl ChannelManager {
                        }
                }
 
-               for failed_forward in failed_forwards.drain(..) {
-                       match failed_forward.2 {
-                               None => self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), &failed_forward.0, HTLCFailReason::Reason { failure_code: failed_forward.1, data: Vec::new() }),
-                               Some(chan_update) => self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), &failed_forward.0, HTLCFailReason::Reason { failure_code: failed_forward.1, data: chan_update.encode_with_len() }),
+               for (htlc_source, payment_hash, failure_code, update) in failed_forwards.drain(..) {
+                       match update {
+                               None => self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), htlc_source, &payment_hash, HTLCFailReason::Reason { failure_code, data: Vec::new() }),
+                               Some(chan_update) => self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), htlc_source, &payment_hash, HTLCFailReason::Reason { failure_code, data: chan_update.encode_with_len() }),
                        };
                }
 
@@ -954,7 +1229,15 @@ impl ChannelManager {
 
        /// Indicates that the preimage for payment_hash is unknown after a PaymentReceived event.
        pub fn fail_htlc_backwards(&self, payment_hash: &[u8; 32]) -> bool {
-               self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), payment_hash, HTLCFailReason::Reason { failure_code: 0x4000 | 15, data: Vec::new() })
+               let mut channel_state = Some(self.channel_state.lock().unwrap());
+               let removed_source = channel_state.as_mut().unwrap().claimable_htlcs.remove(payment_hash);
+               if let Some(mut sources) = removed_source {
+                       for htlc_with_hash in sources.drain(..) {
+                               if channel_state.is_none() { channel_state = Some(self.channel_state.lock().unwrap()); }
+                               self.fail_htlc_backwards_internal(channel_state.take().unwrap(), HTLCSource::PreviousHopData(htlc_with_hash), payment_hash, HTLCFailReason::Reason { failure_code: 0x4000 | 15, data: Vec::new() });
+                       }
+                       true
+               } else { false }
        }
 
        /// Fails an HTLC backwards to the sender of it to us.
@@ -963,37 +1246,17 @@ impl ChannelManager {
        /// to fail and take the channel_state lock for each iteration (as we take ownership and may
        /// drop it). In other words, no assumptions are made that entries in claimable_htlcs point to
        /// still-available channels.
-       fn fail_htlc_backwards_internal(&self, mut channel_state: MutexGuard<ChannelHolder>, payment_hash: &[u8; 32], onion_error: HTLCFailReason) -> bool {
-               let mut pending_htlc = {
-                       match channel_state.claimable_htlcs.remove(payment_hash) {
-                               Some(pending_htlc) => pending_htlc,
-                               None => return false,
-                       }
-               };
-
-               match pending_htlc {
-                       PendingOutboundHTLC::CycledRoute { source_short_channel_id, incoming_packet_shared_secret, route, session_priv } => {
-                               channel_state.claimable_htlcs.insert(payment_hash.clone(), PendingOutboundHTLC::OutboundRoute {
-                                       route,
-                                       session_priv,
-                               });
-                               pending_htlc = PendingOutboundHTLC::IntermediaryHopData { source_short_channel_id, incoming_packet_shared_secret };
-                       },
-                       _ => {}
-               }
-
-               match pending_htlc {
-                       PendingOutboundHTLC::CycledRoute { .. } => unreachable!(),
-                       PendingOutboundHTLC::OutboundRoute { .. } => {
+       fn fail_htlc_backwards_internal(&self, mut channel_state: MutexGuard<ChannelHolder>, source: HTLCSource, payment_hash: &[u8; 32], onion_error: HTLCFailReason) {
+               match source {
+                       HTLCSource::OutboundRoute { .. } => {
                                mem::drop(channel_state);
 
                                let mut pending_events = self.pending_events.lock().unwrap();
                                pending_events.push(events::Event::PaymentFailed {
                                        payment_hash: payment_hash.clone()
                                });
-                               false
                        },
-                       PendingOutboundHTLC::IntermediaryHopData { source_short_channel_id, incoming_packet_shared_secret } => {
+                       HTLCSource::PreviousHopData(HTLCPreviousHopData { short_channel_id, htlc_id, incoming_packet_shared_secret }) => {
                                let err_packet = match onion_error {
                                        HTLCFailReason::Reason { failure_code, data } => {
                                                let packet = ChannelManager::build_failure_packet(&incoming_packet_shared_secret, failure_code, &data[..]).encode();
@@ -1005,17 +1268,17 @@ impl ChannelManager {
                                };
 
                                let (node_id, fail_msgs) = {
-                                       let chan_id = match channel_state.short_to_id.get(&source_short_channel_id) {
+                                       let chan_id = match channel_state.short_to_id.get(&short_channel_id) {
                                                Some(chan_id) => chan_id.clone(),
-                                               None => return false
+                                               None => return
                                        };
 
                                        let chan = channel_state.by_id.get_mut(&chan_id).unwrap();
-                                       match chan.get_update_fail_htlc_and_commit(payment_hash, err_packet) {
+                                       match chan.get_update_fail_htlc_and_commit(htlc_id, err_packet) {
                                                Ok(msg) => (chan.get_their_node_id(), msg),
                                                Err(_e) => {
                                                        //TODO: Do something with e?
-                                                       return false;
+                                                       return;
                                                },
                                        }
                                };
@@ -1029,17 +1292,19 @@ impl ChannelManager {
                                                }
 
                                                let mut pending_events = self.pending_events.lock().unwrap();
-                                               //TODO: replace by HandleError ? UpdateFailHTLC in handle_update_add_htlc need also to build a CommitmentSigned
-                                               pending_events.push(events::Event::SendFailHTLC {
+                                               pending_events.push(events::Event::UpdateHTLCs {
                                                        node_id,
-                                                       msg: msg,
-                                                       commitment_msg: commitment_msg,
+                                                       updates: msgs::CommitmentUpdate {
+                                                               update_add_htlcs: Vec::new(),
+                                                               update_fulfill_htlcs: Vec::new(),
+                                                               update_fail_htlcs: vec![msg],
+                                                               update_fail_malformed_htlcs: Vec::new(),
+                                                               commitment_signed: commitment_msg,
+                                                       },
                                                });
                                        },
                                        None => {},
                                }
-
-                               true
                        },
                }
        }
@@ -1049,69 +1314,51 @@ impl ChannelManager {
        /// should probably kick the net layer to go send messages if this returns true!
        /// May panic if called except in response to a PaymentReceived event.
        pub fn claim_funds(&self, payment_preimage: [u8; 32]) -> bool {
-               self.claim_funds_internal(payment_preimage, true)
-       }
-       fn claim_funds_internal(&self, payment_preimage: [u8; 32], from_user: bool) -> bool {
                let mut sha = Sha256::new();
                sha.input(&payment_preimage);
                let mut payment_hash = [0; 32];
                sha.result(&mut payment_hash);
 
-               let mut channel_state = self.channel_state.lock().unwrap();
-               let mut pending_htlc = {
-                       match channel_state.claimable_htlcs.remove(&payment_hash) {
-                               Some(pending_htlc) => pending_htlc,
-                               None => return false,
+               let mut channel_state = Some(self.channel_state.lock().unwrap());
+               let removed_source = channel_state.as_mut().unwrap().claimable_htlcs.remove(&payment_hash);
+               if let Some(mut sources) = removed_source {
+                       for htlc_with_hash in sources.drain(..) {
+                               if channel_state.is_none() { channel_state = Some(self.channel_state.lock().unwrap()); }
+                               self.claim_funds_internal(channel_state.take().unwrap(), HTLCSource::PreviousHopData(htlc_with_hash), payment_preimage);
                        }
-               };
-
-               match pending_htlc {
-                       PendingOutboundHTLC::CycledRoute { source_short_channel_id, incoming_packet_shared_secret, route, session_priv } => {
-                               if from_user { // This was the end hop back to us
-                                       pending_htlc = PendingOutboundHTLC::IntermediaryHopData { source_short_channel_id, incoming_packet_shared_secret };
-                                       channel_state.claimable_htlcs.insert(payment_hash, PendingOutboundHTLC::OutboundRoute { route, session_priv });
-                               } else { // This came from the first upstream node
-                                       // Bank error in our favor! Maybe we should tell the user this somehow???
-                                       pending_htlc = PendingOutboundHTLC::OutboundRoute { route, session_priv };
-                                       channel_state.claimable_htlcs.insert(payment_hash, PendingOutboundHTLC::IntermediaryHopData { source_short_channel_id, incoming_packet_shared_secret });
-                               }
-                       },
-                       _ => {},
-               }
-
-               match pending_htlc {
-                       PendingOutboundHTLC::CycledRoute { .. } => unreachable!(),
-                       PendingOutboundHTLC::OutboundRoute { .. } => {
-                               if from_user {
-                                       panic!("Called claim_funds with a preimage for an outgoing payment. There is nothing we can do with this, and something is seriously wrong if you knew this...");
-                               }
+                       true
+               } else { false }
+       }
+       fn claim_funds_internal(&self, mut channel_state: MutexGuard<ChannelHolder>, source: HTLCSource, payment_preimage: [u8; 32]) {
+               match source {
+                       HTLCSource::OutboundRoute { .. } => {
                                mem::drop(channel_state);
                                let mut pending_events = self.pending_events.lock().unwrap();
                                pending_events.push(events::Event::PaymentSent {
                                        payment_preimage
                                });
-                               false
                        },
-                       PendingOutboundHTLC::IntermediaryHopData { source_short_channel_id, .. } => {
+                       HTLCSource::PreviousHopData(HTLCPreviousHopData { short_channel_id, htlc_id, .. }) => {
+                               //TODO: Delay the claimed_funds relaying just like we do outbound relay!
                                let (node_id, fulfill_msgs) = {
-                                       let chan_id = match channel_state.short_to_id.get(&source_short_channel_id) {
+                                       let chan_id = match channel_state.short_to_id.get(&short_channel_id) {
                                                Some(chan_id) => chan_id.clone(),
                                                None => {
                                                        // TODO: There is probably a channel manager somewhere that needs to
                                                        // learn the preimage as the channel already hit the chain and that's
                                                        // why its missing.
-                                                       return false
+                                                       return
                                                }
                                        };
 
                                        let chan = channel_state.by_id.get_mut(&chan_id).unwrap();
-                                       match chan.get_update_fulfill_htlc_and_commit(payment_preimage) {
+                                       match chan.get_update_fulfill_htlc_and_commit(htlc_id, payment_preimage) {
                                                Ok(msg) => (chan.get_their_node_id(), msg),
                                                Err(_e) => {
                                                        // TODO: There is probably a channel manager somewhere that needs to
                                                        // learn the preimage as the channel may be about to hit the chain.
                                                        //TODO: Do something with e?
-                                                       return false;
+                                                       return
                                                },
                                        }
                                };
@@ -1125,13 +1372,17 @@ impl ChannelManager {
 
                                if let Some((msg, commitment_msg)) = fulfill_msgs.0 {
                                        let mut pending_events = self.pending_events.lock().unwrap();
-                                       pending_events.push(events::Event::SendFulfillHTLC {
+                                       pending_events.push(events::Event::UpdateHTLCs {
                                                node_id: node_id,
-                                               msg,
-                                               commitment_msg,
+                                               updates: msgs::CommitmentUpdate {
+                                                       update_add_htlcs: Vec::new(),
+                                                       update_fulfill_htlcs: vec![msg],
+                                                       update_fail_htlcs: Vec::new(),
+                                                       update_fail_malformed_htlcs: Vec::new(),
+                                                       commitment_signed: commitment_msg,
+                                               }
                                        });
                                }
-                               true
                        },
                }
        }
@@ -1147,188 +1398,56 @@ impl ChannelManager {
        pub fn test_restore_channel_monitor(&self) {
                unimplemented!();
        }
-}
 
-impl events::EventsProvider for ChannelManager {
-       fn get_and_clear_pending_events(&self) -> Vec<events::Event> {
-               let mut pending_events = self.pending_events.lock().unwrap();
-               let mut ret = Vec::new();
-               mem::swap(&mut ret, &mut *pending_events);
-               ret
+       fn internal_open_channel(&self, their_node_id: &PublicKey, msg: &msgs::OpenChannel) -> Result<msgs::AcceptChannel, MsgHandleErrInternal> {
+               if msg.chain_hash != self.genesis_hash {
+                       return Err(MsgHandleErrInternal::send_err_msg_no_close("Unknown genesis block hash", msg.temporary_channel_id.clone()));
+               }
+               let mut channel_state = self.channel_state.lock().unwrap();
+               if channel_state.by_id.contains_key(&msg.temporary_channel_id) {
+                       return Err(MsgHandleErrInternal::send_err_msg_no_close("temporary_channel_id collision!", msg.temporary_channel_id.clone()));
+               }
+
+               let chan_keys = if cfg!(feature = "fuzztarget") {
+                       ChannelKeys {
+                               funding_key:               SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 1, 0]).unwrap(),
+                               revocation_base_key:       SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 2, 0]).unwrap(),
+                               payment_base_key:          SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 3, 0]).unwrap(),
+                               delayed_payment_base_key:  SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 4, 0]).unwrap(),
+                               htlc_base_key:             SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 5, 0]).unwrap(),
+                               channel_close_key:         SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 6, 0]).unwrap(),
+                               channel_monitor_claim_key: SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 7, 0]).unwrap(),
+                               commitment_seed: [0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0],
+                       }
+               } else {
+                       let mut key_seed = [0u8; 32];
+                       rng::fill_bytes(&mut key_seed);
+                       match ChannelKeys::new_from_seed(&key_seed) {
+                               Ok(key) => key,
+                               Err(_) => panic!("RNG is busted!")
+                       }
+               };
+
+               let channel = Channel::new_from_req(&*self.fee_estimator, chan_keys, their_node_id.clone(), msg, 0, false, self.announce_channels_publicly, Arc::clone(&self.logger)).map_err(|e| MsgHandleErrInternal::from_no_close(e))?;
+               let accept_msg = channel.get_accept_channel();
+               channel_state.by_id.insert(channel.channel_id(), channel);
+               Ok(accept_msg)
        }
-}
 
-impl ChainListener for ChannelManager {
-       fn block_connected(&self, header: &BlockHeader, height: u32, txn_matched: &[&Transaction], indexes_of_txn_matched: &[u32]) {
-               let mut new_events = Vec::new();
-               let mut failed_channels = Vec::new();
-               {
-                       let mut channel_lock = self.channel_state.lock().unwrap();
-                       let channel_state = channel_lock.borrow_parts();
-                       let short_to_id = channel_state.short_to_id;
-                       channel_state.by_id.retain(|_, channel| {
-                               let chan_res = channel.block_connected(header, height, txn_matched, indexes_of_txn_matched);
-                               if let Ok(Some(funding_locked)) = chan_res {
-                                       let announcement_sigs = match self.get_announcement_sigs(channel) {
-                                               Ok(res) => res,
-                                               Err(e) => {
-                                                       log_error!(self, "Got error handling message: {}!", e.err);
-                                                       //TODO: push e on events and blow up the channel (it has bad keys)
-                                                       return true;
-                                               }
-                                       };
-                                       new_events.push(events::Event::SendFundingLocked {
-                                               node_id: channel.get_their_node_id(),
-                                               msg: funding_locked,
-                                               announcement_sigs: announcement_sigs
-                                       });
-                                       short_to_id.insert(channel.get_short_channel_id().unwrap(), channel.channel_id());
-                               } else if let Err(e) = chan_res {
-                                       new_events.push(events::Event::HandleError {
-                                               node_id: channel.get_their_node_id(),
-                                               action: e.action,
-                                       });
-                                       if channel.is_shutdown() {
-                                               return false;
-                                       }
-                               }
-                               if let Some(funding_txo) = channel.get_funding_txo() {
-                                       for tx in txn_matched {
-                                               for inp in tx.input.iter() {
-                                                       if inp.previous_output == funding_txo.into_bitcoin_outpoint() {
-                                                               if let Some(short_id) = channel.get_short_channel_id() {
-                                                                       short_to_id.remove(&short_id);
-                                                               }
-                                                               // It looks like our counterparty went on-chain. We go ahead and
-                                                               // broadcast our latest local state as well here, just in case its
-                                                               // some kind of SPV attack, though we expect these to be dropped.
-                                                               failed_channels.push(channel.force_shutdown());
-                                                               if let Ok(update) = self.get_channel_update(&channel) {
-                                                                       new_events.push(events::Event::BroadcastChannelUpdate {
-                                                                               msg: update
-                                                                       });
-                                                               }
-                                                               return false;
-                                                       }
-                                               }
-                                       }
-                               }
-                               if channel.is_funding_initiated() && channel.channel_monitor().would_broadcast_at_height(height) {
-                                       if let Some(short_id) = channel.get_short_channel_id() {
-                                               short_to_id.remove(&short_id);
-                                       }
-                                       failed_channels.push(channel.force_shutdown());
-                                       // If would_broadcast_at_height() is true, the channel_monitor will broadcast
-                                       // the latest local tx for us, so we should skip that here (it doesn't really
-                                       // hurt anything, but does make tests a bit simpler).
-                                       failed_channels.last_mut().unwrap().0 = Vec::new();
-                                       if let Ok(update) = self.get_channel_update(&channel) {
-                                               new_events.push(events::Event::BroadcastChannelUpdate {
-                                                       msg: update
-                                               });
-                                       }
-                                       return false;
-                               }
-                               true
-                       });
-               }
-               for failure in failed_channels.drain(..) {
-                       self.finish_force_close_channel(failure);
-               }
-               let mut pending_events = self.pending_events.lock().unwrap();
-               for funding_locked in new_events.drain(..) {
-                       pending_events.push(funding_locked);
-               }
-               self.latest_block_height.store(height as usize, Ordering::Release);
-       }
-
-       /// We force-close the channel without letting our counterparty participate in the shutdown
-       fn block_disconnected(&self, header: &BlockHeader) {
-               let mut new_events = Vec::new();
-               let mut failed_channels = Vec::new();
-               {
-                       let mut channel_lock = self.channel_state.lock().unwrap();
-                       let channel_state = channel_lock.borrow_parts();
-                       let short_to_id = channel_state.short_to_id;
-                       channel_state.by_id.retain(|_,  v| {
-                               if v.block_disconnected(header) {
-                                       if let Some(short_id) = v.get_short_channel_id() {
-                                               short_to_id.remove(&short_id);
-                                       }
-                                       failed_channels.push(v.force_shutdown());
-                                       if let Ok(update) = self.get_channel_update(&v) {
-                                               new_events.push(events::Event::BroadcastChannelUpdate {
-                                                       msg: update
-                                               });
-                                       }
-                                       false
-                               } else {
-                                       true
-                               }
-                       });
-               }
-               for failure in failed_channels.drain(..) {
-                       self.finish_force_close_channel(failure);
-               }
-               if !new_events.is_empty() {
-                       let mut pending_events = self.pending_events.lock().unwrap();
-                       for funding_locked in new_events.drain(..) {
-                               pending_events.push(funding_locked);
-                       }
-               }
-               self.latest_block_height.fetch_sub(1, Ordering::AcqRel);
-       }
-}
-
-impl ChannelMessageHandler for ChannelManager {
-       //TODO: Handle errors and close channel (or so)
-       fn handle_open_channel(&self, their_node_id: &PublicKey, msg: &msgs::OpenChannel) -> Result<msgs::AcceptChannel, HandleError> {
-               if msg.chain_hash != self.genesis_hash {
-                       return Err(HandleError{err: "Unknown genesis block hash", action: None});
-               }
-               let mut channel_state = self.channel_state.lock().unwrap();
-               if channel_state.by_id.contains_key(&msg.temporary_channel_id) {
-                       return Err(HandleError{err: "temporary_channel_id collision!", action: None});
-               }
-
-               let chan_keys = if cfg!(feature = "fuzztarget") {
-                       ChannelKeys {
-                               funding_key:               SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 1, 0]).unwrap(),
-                               revocation_base_key:       SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 2, 0]).unwrap(),
-                               payment_base_key:          SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 3, 0]).unwrap(),
-                               delayed_payment_base_key:  SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 4, 0]).unwrap(),
-                               htlc_base_key:             SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 5, 0]).unwrap(),
-                               channel_close_key:         SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 6, 0]).unwrap(),
-                               channel_monitor_claim_key: SecretKey::from_slice(&self.secp_ctx, &[0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 7, 0]).unwrap(),
-                               commitment_seed: [0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0, 0],
-                       }
-               } else {
-                       let mut key_seed = [0u8; 32];
-                       rng::fill_bytes(&mut key_seed);
-                       match ChannelKeys::new_from_seed(&key_seed) {
-                               Ok(key) => key,
-                               Err(_) => panic!("RNG is busted!")
-                       }
-               };
-
-               let channel = Channel::new_from_req(&*self.fee_estimator, chan_keys, their_node_id.clone(), msg, 0, false, self.announce_channels_publicly, Arc::clone(&self.logger))?;
-               let accept_msg = channel.get_accept_channel()?;
-               channel_state.by_id.insert(channel.channel_id(), channel);
-               Ok(accept_msg)
-       }
-
-       fn handle_accept_channel(&self, their_node_id: &PublicKey, msg: &msgs::AcceptChannel) -> Result<(), HandleError> {
+       fn internal_accept_channel(&self, their_node_id: &PublicKey, msg: &msgs::AcceptChannel) -> Result<(), MsgHandleErrInternal> {
                let (value, output_script, user_id) = {
                        let mut channel_state = self.channel_state.lock().unwrap();
                        match channel_state.by_id.get_mut(&msg.temporary_channel_id) {
                                Some(chan) => {
                                        if chan.get_their_node_id() != *their_node_id {
-                                               return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
+                                               //TODO: see issue #153, need a consistent behavior on obnoxious behavior from random node
+                                               return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.temporary_channel_id));
                                        }
-                                       chan.accept_channel(&msg)?;
+                                       chan.accept_channel(&msg).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))?;
                                        (chan.get_value_satoshis(), chan.get_funding_redeemscript().to_v0_p2wsh(), chan.get_user_id())
                                },
-                               None => return Err(HandleError{err: "Failed to find corresponding channel", action: None})
+                               //TODO: same as above
+                               None => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.temporary_channel_id))
                        }
                };
                let mut pending_events = self.pending_events.lock().unwrap();
@@ -1341,25 +1460,25 @@ impl ChannelMessageHandler for ChannelManager {
                Ok(())
        }
 
-       fn handle_funding_created(&self, their_node_id: &PublicKey, msg: &msgs::FundingCreated) -> Result<msgs::FundingSigned, HandleError> {
+       fn internal_funding_created(&self, their_node_id: &PublicKey, msg: &msgs::FundingCreated) -> Result<msgs::FundingSigned, MsgHandleErrInternal> {
                let (chan, funding_msg, monitor_update) = {
                        let mut channel_state = self.channel_state.lock().unwrap();
                        match channel_state.by_id.entry(msg.temporary_channel_id.clone()) {
                                hash_map::Entry::Occupied(mut chan) => {
                                        if chan.get().get_their_node_id() != *their_node_id {
-                                               return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
+                                               //TODO: here and below MsgHandleErrInternal, #153 case
+                                               return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.temporary_channel_id));
                                        }
                                        match chan.get_mut().funding_created(msg) {
                                                Ok((funding_msg, monitor_update)) => {
                                                        (chan.remove(), funding_msg, monitor_update)
                                                },
                                                Err(e) => {
-                                                       //TODO: Possibly remove the channel depending on e.action
-                                                       return Err(e);
+                                                       return Err(e).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))
                                                }
                                        }
                                },
-                               hash_map::Entry::Vacant(_) => return Err(HandleError{err: "Failed to find corresponding channel", action: None})
+                               hash_map::Entry::Vacant(_) => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.temporary_channel_id))
                        }
                }; // Release channel lock for install_watch_outpoint call,
                   // note that this means if the remote end is misbehaving and sends a message for the same
@@ -1371,10 +1490,7 @@ impl ChannelMessageHandler for ChannelManager {
                let mut channel_state = self.channel_state.lock().unwrap();
                match channel_state.by_id.entry(funding_msg.channel_id) {
                        hash_map::Entry::Occupied(_) => {
-                               return Err(HandleError {
-                                       err: "Duplicate channel_id!",
-                                       action: Some(msgs::ErrorAction::SendErrorMessage { msg: msgs::ErrorMessage { channel_id: funding_msg.channel_id, data: "Already had channel with the new channel_id".to_owned() } })
-                               });
+                               return Err(MsgHandleErrInternal::send_err_msg_no_close("Already had channel with the new channel_id", funding_msg.channel_id))
                        },
                        hash_map::Entry::Vacant(e) => {
                                e.insert(chan);
@@ -1383,18 +1499,19 @@ impl ChannelMessageHandler for ChannelManager {
                Ok(funding_msg)
        }
 
-       fn handle_funding_signed(&self, their_node_id: &PublicKey, msg: &msgs::FundingSigned) -> Result<(), HandleError> {
+       fn internal_funding_signed(&self, their_node_id: &PublicKey, msg: &msgs::FundingSigned) -> Result<(), MsgHandleErrInternal> {
                let (funding_txo, user_id, monitor) = {
                        let mut channel_state = self.channel_state.lock().unwrap();
                        match channel_state.by_id.get_mut(&msg.channel_id) {
                                Some(chan) => {
                                        if chan.get_their_node_id() != *their_node_id {
-                                               return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
+                                               //TODO: here and below MsgHandleErrInternal, #153 case
+                                               return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.channel_id));
                                        }
-                                       let chan_monitor = chan.funding_signed(&msg)?;
+                                       let chan_monitor = chan.funding_signed(&msg).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))?;
                                        (chan.get_funding_txo().unwrap(), chan.get_user_id(), chan_monitor)
                                },
-                               None => return Err(HandleError{err: "Failed to find corresponding channel", action: None})
+                               None => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.channel_id))
                        }
                };
                if let Err(_e) = self.monitor.add_update_monitor(monitor.get_funding_txo().unwrap(), monitor) {
@@ -1408,31 +1525,33 @@ impl ChannelMessageHandler for ChannelManager {
                Ok(())
        }
 
-       fn handle_funding_locked(&self, their_node_id: &PublicKey, msg: &msgs::FundingLocked) -> Result<Option<msgs::AnnouncementSignatures>, HandleError> {
+       fn internal_funding_locked(&self, their_node_id: &PublicKey, msg: &msgs::FundingLocked) -> Result<Option<msgs::AnnouncementSignatures>, MsgHandleErrInternal> {
                let mut channel_state = self.channel_state.lock().unwrap();
                match channel_state.by_id.get_mut(&msg.channel_id) {
                        Some(chan) => {
                                if chan.get_their_node_id() != *their_node_id {
-                                       return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
+                                       //TODO: here and below MsgHandleErrInternal, #153 case
+                                       return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.channel_id));
                                }
-                               chan.funding_locked(&msg)?;
-                               return Ok(self.get_announcement_sigs(chan)?);
+                               chan.funding_locked(&msg).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))?;
+                               return Ok(self.get_announcement_sigs(chan));
                        },
-                       None => return Err(HandleError{err: "Failed to find corresponding channel", action: None})
+                       None => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.channel_id))
                };
        }
 
-       fn handle_shutdown(&self, their_node_id: &PublicKey, msg: &msgs::Shutdown) -> Result<(Option<msgs::Shutdown>, Option<msgs::ClosingSigned>), HandleError> {
-               let (res, chan_option) = {
+       fn internal_shutdown(&self, their_node_id: &PublicKey, msg: &msgs::Shutdown) -> Result<(Option<msgs::Shutdown>, Option<msgs::ClosingSigned>), MsgHandleErrInternal> {
+               let (mut res, chan_option) = {
                        let mut channel_state_lock = self.channel_state.lock().unwrap();
                        let channel_state = channel_state_lock.borrow_parts();
 
                        match channel_state.by_id.entry(msg.channel_id.clone()) {
                                hash_map::Entry::Occupied(mut chan_entry) => {
                                        if chan_entry.get().get_their_node_id() != *their_node_id {
-                                               return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
+                                               //TODO: here and below MsgHandleErrInternal, #153 case
+                                               return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.channel_id));
                                        }
-                                       let res = chan_entry.get_mut().shutdown(&*self.fee_estimator, &msg)?;
+                                       let res = chan_entry.get_mut().shutdown(&*self.fee_estimator, &msg).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))?;
                                        if chan_entry.get().is_shutdown() {
                                                if let Some(short_id) = chan_entry.get().get_short_channel_id() {
                                                        channel_state.short_to_id.remove(&short_id);
@@ -1440,12 +1559,12 @@ impl ChannelMessageHandler for ChannelManager {
                                                (res, Some(chan_entry.remove_entry().1))
                                        } else { (res, None) }
                                },
-                               hash_map::Entry::Vacant(_) => return Err(HandleError{err: "Failed to find corresponding channel", action: None})
+                               hash_map::Entry::Vacant(_) => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.channel_id))
                        }
                };
-               for payment_hash in res.2 {
+               for htlc_source in res.2.drain(..) {
                        // unknown_next_peer...I dunno who that is anymore....
-                       self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), &payment_hash, HTLCFailReason::Reason { failure_code: 0x4000 | 10, data: Vec::new() });
+                       self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), htlc_source.0, &htlc_source.1, HTLCFailReason::Reason { failure_code: 0x4000 | 10, data: Vec::new() });
                }
                if let Some(chan) = chan_option {
                        if let Ok(update) = self.get_channel_update(&chan) {
@@ -1458,16 +1577,17 @@ impl ChannelMessageHandler for ChannelManager {
                Ok((res.0, res.1))
        }
 
-       fn handle_closing_signed(&self, their_node_id: &PublicKey, msg: &msgs::ClosingSigned) -> Result<Option<msgs::ClosingSigned>, HandleError> {
+       fn internal_closing_signed(&self, their_node_id: &PublicKey, msg: &msgs::ClosingSigned) -> Result<Option<msgs::ClosingSigned>, MsgHandleErrInternal> {
                let (res, chan_option) = {
                        let mut channel_state_lock = self.channel_state.lock().unwrap();
                        let channel_state = channel_state_lock.borrow_parts();
                        match channel_state.by_id.entry(msg.channel_id.clone()) {
                                hash_map::Entry::Occupied(mut chan_entry) => {
                                        if chan_entry.get().get_their_node_id() != *their_node_id {
-                                               return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
+                                               //TODO: here and below MsgHandleErrInternal, #153 case
+                                               return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.channel_id));
                                        }
-                                       let res = chan_entry.get_mut().closing_signed(&*self.fee_estimator, &msg)?;
+                                       let res = chan_entry.get_mut().closing_signed(&*self.fee_estimator, &msg).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))?;
                                        if res.1.is_some() {
                                                // We're done with this channel, we've got a signed closing transaction and
                                                // will send the closing_signed back to the remote peer upon return. This
@@ -1480,7 +1600,7 @@ impl ChannelMessageHandler for ChannelManager {
                                                (res, Some(chan_entry.remove_entry().1))
                                        } else { (res, None) }
                                },
-                               hash_map::Entry::Vacant(_) => return Err(HandleError{err: "Failed to find corresponding channel", action: None})
+                               hash_map::Entry::Vacant(_) => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.channel_id))
                        }
                };
                if let Some(broadcast_tx) = res.1 {
@@ -1497,7 +1617,7 @@ impl ChannelMessageHandler for ChannelManager {
                Ok(res.0)
        }
 
-       fn handle_update_add_htlc(&self, their_node_id: &PublicKey, msg: &msgs::UpdateAddHTLC) -> Result<(), msgs::HandleError> {
+       fn internal_update_add_htlc(&self, their_node_id: &PublicKey, msg: &msgs::UpdateAddHTLC) -> Result<(), MsgHandleErrInternal> {
                //TODO: BOLT 4 points out a specific attack where a peer may re-send an onion packet and
                //determine the state of the payment based on our response/if we forward anything/the time
                //we take to respond. We should take care to avoid allowing such an attack.
@@ -1507,459 +1627,503 @@ impl ChannelMessageHandler for ChannelManager {
                //encrypted with the same key. Its not immediately obvious how to usefully exploit that,
                //but we should prevent it anyway.
 
-               let shared_secret = SharedSecret::new(&self.secp_ctx, &msg.onion_routing_packet.public_key, &self.our_network_key);
-               let (rho, mu) = ChannelManager::gen_rho_mu_from_shared_secret(&shared_secret);
+               let (pending_forward_info, mut channel_state_lock) = self.decode_update_add_htlc_onion(msg);
+               let channel_state = channel_state_lock.borrow_parts();
 
-               macro_rules! get_onion_hash {
-                       () => {
-                               {
-                                       let mut sha = Sha256::new();
-                                       sha.input(&msg.onion_routing_packet.hop_data);
-                                       let mut onion_hash = [0; 32];
-                                       sha.result(&mut onion_hash);
-                                       onion_hash
+               match channel_state.by_id.get_mut(&msg.channel_id) {
+                       Some(chan) => {
+                               if chan.get_their_node_id() != *their_node_id {
+                                       //TODO: here MsgHandleErrInternal, #153 case
+                                       return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.channel_id));
                                }
-                       }
+                               if !chan.is_usable() {
+                                       return Err(MsgHandleErrInternal::from_no_close(HandleError{err: "Channel not yet available for receiving HTLCs", action: Some(msgs::ErrorAction::IgnoreError)}));
+                               }
+                               chan.update_add_htlc(&msg, pending_forward_info).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))
+                       },
+                       None => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.channel_id))
                }
+       }
 
-               macro_rules! return_err {
-                       ($msg: expr, $err_code: expr, $data: expr) => {
-                               return Err(msgs::HandleError {
-                                       err: $msg,
-                                       action: Some(msgs::ErrorAction::UpdateFailHTLC {
-                                               msg: msgs::UpdateFailHTLC {
-                                                       channel_id: msg.channel_id,
-                                                       htlc_id: msg.htlc_id,
-                                                       reason: ChannelManager::build_first_hop_failure_packet(&shared_secret, $err_code, $data),
+       fn internal_update_fulfill_htlc(&self, their_node_id: &PublicKey, msg: &msgs::UpdateFulfillHTLC) -> Result<(), MsgHandleErrInternal> {
+               let mut channel_state = self.channel_state.lock().unwrap();
+               let htlc_source = match channel_state.by_id.get_mut(&msg.channel_id) {
+                       Some(chan) => {
+                               if chan.get_their_node_id() != *their_node_id {
+                                       //TODO: here and below MsgHandleErrInternal, #153 case
+                                       return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.channel_id));
+                               }
+                               chan.update_fulfill_htlc(&msg).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))?.clone()
+                       },
+                       None => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.channel_id))
+               };
+               self.claim_funds_internal(channel_state, htlc_source, msg.payment_preimage.clone());
+               Ok(())
+       }
+
+       fn internal_update_fail_htlc(&self, their_node_id: &PublicKey, msg: &msgs::UpdateFailHTLC) -> Result<Option<msgs::HTLCFailChannelUpdate>, MsgHandleErrInternal> {
+               let mut channel_state = self.channel_state.lock().unwrap();
+               let htlc_source = match channel_state.by_id.get_mut(&msg.channel_id) {
+                       Some(chan) => {
+                               if chan.get_their_node_id() != *their_node_id {
+                                       //TODO: here and below MsgHandleErrInternal, #153 case
+                                       return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.channel_id));
+                               }
+                               chan.update_fail_htlc(&msg, HTLCFailReason::ErrorPacket { err: msg.reason.clone() }).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))
+                       },
+                       None => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.channel_id))
+               }?;
+
+               match htlc_source {
+                       &HTLCSource::OutboundRoute { ref route, ref session_priv, .. } => {
+                               // Handle packed channel/node updates for passing back for the route handler
+                               let mut packet_decrypted = msg.reason.data.clone();
+                               let mut res = None;
+                               Self::construct_onion_keys_callback(&self.secp_ctx, &route, &session_priv, |shared_secret, _, _, route_hop| {
+                                       if res.is_some() { return; }
+
+                                       let ammag = ChannelManager::gen_ammag_from_shared_secret(&shared_secret);
+
+                                       let mut decryption_tmp = Vec::with_capacity(packet_decrypted.len());
+                                       decryption_tmp.resize(packet_decrypted.len(), 0);
+                                       let mut chacha = ChaCha20::new(&ammag, &[0u8; 8]);
+                                       chacha.process(&packet_decrypted, &mut decryption_tmp[..]);
+                                       packet_decrypted = decryption_tmp;
+
+                                       if let Ok(err_packet) = msgs::DecodedOnionErrorPacket::read(&mut Cursor::new(&packet_decrypted)) {
+                                               if err_packet.failuremsg.len() >= 2 {
+                                                       let um = ChannelManager::gen_um_from_shared_secret(&shared_secret);
+
+                                                       let mut hmac = Hmac::new(Sha256::new(), &um);
+                                                       hmac.input(&err_packet.encode()[32..]);
+                                                       let mut calc_tag = [0u8; 32];
+                                                       hmac.raw_result(&mut calc_tag);
+                                                       if crypto::util::fixed_time_eq(&calc_tag, &err_packet.hmac) {
+                                                               const UNKNOWN_CHAN: u16 = 0x4000|10;
+                                                               const TEMP_CHAN_FAILURE: u16 = 0x4000|7;
+                                                               match byte_utils::slice_to_be16(&err_packet.failuremsg[0..2]) {
+                                                                       TEMP_CHAN_FAILURE => {
+                                                                               if err_packet.failuremsg.len() >= 4 {
+                                                                                       let update_len = byte_utils::slice_to_be16(&err_packet.failuremsg[2..4]) as usize;
+                                                                                       if err_packet.failuremsg.len() >= 4 + update_len {
+                                                                                               if let Ok(chan_update) = msgs::ChannelUpdate::read(&mut Cursor::new(&err_packet.failuremsg[4..4 + update_len])) {
+                                                                                                       res = Some(msgs::HTLCFailChannelUpdate::ChannelUpdateMessage {
+                                                                                                               msg: chan_update,
+                                                                                                       });
+                                                                                               }
+                                                                                       }
+                                                                               }
+                                                                       },
+                                                                       UNKNOWN_CHAN => {
+                                                                               // No such next-hop. We know this came from the
+                                                                               // current node as the HMAC validated.
+                                                                               res = Some(msgs::HTLCFailChannelUpdate::ChannelClosed {
+                                                                                       short_channel_id: route_hop.short_channel_id
+                                                                               });
+                                                                       },
+                                                                       _ => {}, //TODO: Enumerate all of these!
+                                                               }
+                                                       }
                                                }
-                                       }),
-                               });
-                       }
+                                       }
+                               }).unwrap();
+                               Ok(res)
+                       },
+                       _ => { Ok(None) },
                }
+       }
 
-               if msg.onion_routing_packet.version != 0 {
-                       //TODO: Spec doesn't indicate if we should only hash hop_data here (and in other
-                       //sha256_of_onion error data packets), or the entire onion_routing_packet. Either way,
-                       //the hash doesn't really serve any purpuse - in the case of hashing all data, the
-                       //receiving node would have to brute force to figure out which version was put in the
-                       //packet by the node that send us the message, in the case of hashing the hop_data, the
-                       //node knows the HMAC matched, so they already know what is there...
-                       return_err!("Unknown onion packet version", 0x8000 | 0x4000 | 4, &get_onion_hash!());
+       fn internal_update_fail_malformed_htlc(&self, their_node_id: &PublicKey, msg: &msgs::UpdateFailMalformedHTLC) -> Result<(), MsgHandleErrInternal> {
+               let mut channel_state = self.channel_state.lock().unwrap();
+               match channel_state.by_id.get_mut(&msg.channel_id) {
+                       Some(chan) => {
+                               if chan.get_their_node_id() != *their_node_id {
+                                       //TODO: here and below MsgHandleErrInternal, #153 case
+                                       return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.channel_id));
+                               }
+                               chan.update_fail_malformed_htlc(&msg, HTLCFailReason::Reason { failure_code: msg.failure_code, data: Vec::new() }).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))?;
+                               Ok(())
+                       },
+                       None => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.channel_id))
                }
+       }
 
-               let mut hmac = Hmac::new(Sha256::new(), &mu);
-               hmac.input(&msg.onion_routing_packet.hop_data);
-               hmac.input(&msg.payment_hash);
-               if hmac.result() != MacResult::new(&msg.onion_routing_packet.hmac) {
-                       return_err!("HMAC Check failed", 0x8000 | 0x4000 | 5, &get_onion_hash!());
+       fn internal_commitment_signed(&self, their_node_id: &PublicKey, msg: &msgs::CommitmentSigned) -> Result<(msgs::RevokeAndACK, Option<msgs::CommitmentSigned>), MsgHandleErrInternal> {
+               let (revoke_and_ack, commitment_signed, chan_monitor) = {
+                       let mut channel_state = self.channel_state.lock().unwrap();
+                       match channel_state.by_id.get_mut(&msg.channel_id) {
+                               Some(chan) => {
+                                       if chan.get_their_node_id() != *their_node_id {
+                                               //TODO: here and below MsgHandleErrInternal, #153 case
+                                               return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.channel_id));
+                                       }
+                                       chan.commitment_signed(&msg).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))?
+                               },
+                               None => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.channel_id))
+                       }
+               };
+               if let Err(_e) = self.monitor.add_update_monitor(chan_monitor.get_funding_txo().unwrap(), chan_monitor) {
+                       unimplemented!();
                }
 
-               let mut chacha = ChaCha20::new(&rho, &[0u8; 8]);
-               let next_hop_data = {
-                       let mut decoded = [0; 65];
-                       chacha.process(&msg.onion_routing_packet.hop_data[0..65], &mut decoded);
-                       match msgs::OnionHopData::decode(&decoded[..]) {
-                               Err(err) => {
-                                       let error_code = match err {
-                                               msgs::DecodeError::UnknownRealmByte => 0x4000 | 1,
-                                               _ => 0x2000 | 2, // Should never happen
-                                       };
-                                       return_err!("Unable to decode our hop data", error_code, &[0;0]);
+               Ok((revoke_and_ack, commitment_signed))
+       }
+
+       fn internal_revoke_and_ack(&self, their_node_id: &PublicKey, msg: &msgs::RevokeAndACK) -> Result<Option<msgs::CommitmentUpdate>, MsgHandleErrInternal> {
+               let ((res, mut pending_forwards, mut pending_failures, chan_monitor), short_channel_id) = {
+                       let mut channel_state = self.channel_state.lock().unwrap();
+                       match channel_state.by_id.get_mut(&msg.channel_id) {
+                               Some(chan) => {
+                                       if chan.get_their_node_id() != *their_node_id {
+                                               //TODO: here and below MsgHandleErrInternal, #153 case
+                                               return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.channel_id));
+                                       }
+                                       (chan.revoke_and_ack(&msg).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))?, chan.get_short_channel_id().expect("RAA should only work on a short-id-available channel"))
                                },
-                               Ok(msg) => msg
+                               None => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.channel_id))
                        }
                };
+               if let Err(_e) = self.monitor.add_update_monitor(chan_monitor.get_funding_txo().unwrap(), chan_monitor) {
+                       unimplemented!();
+               }
+               for failure in pending_failures.drain(..) {
+                       self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), failure.0, &failure.1, failure.2);
+               }
 
-               //TODO: Check that msg.cltv_expiry is within acceptable bounds!
-
-               let mut pending_forward_info = if next_hop_data.hmac == [0; 32] {
-                               // OUR PAYMENT!
-                               if next_hop_data.data.amt_to_forward != msg.amount_msat {
-                                       return_err!("Upstream node sent less than we were supposed to receive in payment", 19, &byte_utils::be64_to_array(msg.amount_msat));
-                               }
-                               if next_hop_data.data.outgoing_cltv_value != msg.cltv_expiry {
-                                       return_err!("Upstream node set CLTV to the wrong value", 18, &byte_utils::be32_to_array(msg.cltv_expiry));
+               let mut forward_event = None;
+               if !pending_forwards.is_empty() {
+                       let mut channel_state = self.channel_state.lock().unwrap();
+                       if channel_state.forward_htlcs.is_empty() {
+                               forward_event = Some(Instant::now() + Duration::from_millis(((rng::rand_f32() * 4.0 + 1.0) * MIN_HTLC_RELAY_HOLDING_CELL_MILLIS as f32) as u64));
+                               channel_state.next_forward = forward_event.unwrap();
+                       }
+                       for (forward_info, prev_htlc_id) in pending_forwards.drain(..) {
+                               match channel_state.forward_htlcs.entry(forward_info.short_channel_id) {
+                                       hash_map::Entry::Occupied(mut entry) => {
+                                               entry.get_mut().push(HTLCForwardInfo { prev_short_channel_id: short_channel_id, prev_htlc_id, forward_info });
+                                       },
+                                       hash_map::Entry::Vacant(entry) => {
+                                               entry.insert(vec!(HTLCForwardInfo { prev_short_channel_id: short_channel_id, prev_htlc_id, forward_info }));
+                                       }
                                }
+                       }
+               }
+               match forward_event {
+                       Some(time) => {
+                               let mut pending_events = self.pending_events.lock().unwrap();
+                               pending_events.push(events::Event::PendingHTLCsForwardable {
+                                       time_forwardable: time
+                               });
+                       }
+                       None => {},
+               }
 
-                               // Note that we could obviously respond immediately with an update_fulfill_htlc
-                               // message, however that would leak that we are the recipient of this payment, so
-                               // instead we stay symmetric with the forwarding case, only responding (after a
-                               // delay) once they've send us a commitment_signed!
+               Ok(res)
+       }
 
-                               PendingForwardHTLCInfo {
-                                       onion_packet: None,
-                                       payment_hash: msg.payment_hash.clone(),
-                                       short_channel_id: 0,
-                                       prev_short_channel_id: 0,
-                                       amt_to_forward: next_hop_data.data.amt_to_forward,
-                                       outgoing_cltv_value: next_hop_data.data.outgoing_cltv_value,
+       fn internal_update_fee(&self, their_node_id: &PublicKey, msg: &msgs::UpdateFee) -> Result<(), MsgHandleErrInternal> {
+               let mut channel_state = self.channel_state.lock().unwrap();
+               match channel_state.by_id.get_mut(&msg.channel_id) {
+                       Some(chan) => {
+                               if chan.get_their_node_id() != *their_node_id {
+                                       //TODO: here and below MsgHandleErrInternal, #153 case
+                                       return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.channel_id));
                                }
-                       } else {
-                               let mut new_packet_data = [0; 20*65];
-                               chacha.process(&msg.onion_routing_packet.hop_data[65..], &mut new_packet_data[0..19*65]);
-                               chacha.process(&ChannelManager::ZERO[0..65], &mut new_packet_data[19*65..]);
-
-                               let mut new_pubkey = msg.onion_routing_packet.public_key.clone();
+                               chan.update_fee(&*self.fee_estimator, &msg).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))
+                       },
+                       None => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.channel_id))
+               }
+       }
 
-                               let blinding_factor = {
-                                       let mut sha = Sha256::new();
-                                       sha.input(&new_pubkey.serialize()[..]);
-                                       sha.input(&shared_secret[..]);
-                                       let mut res = [0u8; 32];
-                                       sha.result(&mut res);
-                                       match SecretKey::from_slice(&self.secp_ctx, &res) {
-                                               Err(_) => {
-                                                       // Return temporary node failure as its technically our issue, not the
-                                                       // channel's issue.
-                                                       return_err!("Blinding factor is an invalid private key", 0x2000 | 2, &[0;0]);
-                                               },
-                                               Ok(key) => key
+       fn internal_announcement_signatures(&self, their_node_id: &PublicKey, msg: &msgs::AnnouncementSignatures) -> Result<(), MsgHandleErrInternal> {
+               let (chan_announcement, chan_update) = {
+                       let mut channel_state = self.channel_state.lock().unwrap();
+                       match channel_state.by_id.get_mut(&msg.channel_id) {
+                               Some(chan) => {
+                                       if chan.get_their_node_id() != *their_node_id {
+                                               return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.channel_id));
+                                       }
+                                       if !chan.is_usable() {
+                                               return Err(MsgHandleErrInternal::from_no_close(HandleError{err: "Got an announcement_signatures before we were ready for it", action: Some(msgs::ErrorAction::IgnoreError)}));
                                        }
-                               };
 
-                               match new_pubkey.mul_assign(&self.secp_ctx, &blinding_factor) {
-                                       Err(_) => {
-                                               // Return temporary node failure as its technically our issue, not the
-                                               // channel's issue.
-                                               return_err!("New blinding factor is an invalid private key", 0x2000 | 2, &[0;0]);
-                                       },
-                                       Ok(_) => {}
-                               };
+                                       let our_node_id = self.get_our_node_id();
+                                       let (announcement, our_bitcoin_sig) = chan.get_channel_announcement(our_node_id.clone(), self.genesis_hash.clone())
+                                               .map_err(|e| MsgHandleErrInternal::from_maybe_close(e))?;
 
-                               let outgoing_packet = msgs::OnionPacket {
-                                       version: 0,
-                                       public_key: new_pubkey,
-                                       hop_data: new_packet_data,
-                                       hmac: next_hop_data.hmac.clone(),
-                               };
+                                       let were_node_one = announcement.node_id_1 == our_node_id;
+                                       let msghash = Message::from_slice(&Sha256dHash::from_data(&announcement.encode()[..])[..]).unwrap();
+                                       let bad_sig_action = MsgHandleErrInternal::send_err_msg_close_chan("Bad announcement_signatures node_signature", msg.channel_id);
+                                       secp_call!(self.secp_ctx.verify(&msghash, &msg.node_signature, if were_node_one { &announcement.node_id_2 } else { &announcement.node_id_1 }), bad_sig_action);
+                                       secp_call!(self.secp_ctx.verify(&msghash, &msg.bitcoin_signature, if were_node_one { &announcement.bitcoin_key_2 } else { &announcement.bitcoin_key_1 }), bad_sig_action);
 
-                               PendingForwardHTLCInfo {
-                                       onion_packet: Some(outgoing_packet),
-                                       payment_hash: msg.payment_hash.clone(),
-                                       short_channel_id: next_hop_data.data.short_channel_id,
-                                       prev_short_channel_id: 0,
-                                       amt_to_forward: next_hop_data.data.amt_to_forward,
-                                       outgoing_cltv_value: next_hop_data.data.outgoing_cltv_value,
-                               }
-                       };
+                                       let our_node_sig = self.secp_ctx.sign(&msghash, &self.our_network_key);
 
-               let mut channel_state_lock = self.channel_state.lock().unwrap();
-               let channel_state = channel_state_lock.borrow_parts();
+                                       (msgs::ChannelAnnouncement {
+                                               node_signature_1: if were_node_one { our_node_sig } else { msg.node_signature },
+                                               node_signature_2: if were_node_one { msg.node_signature } else { our_node_sig },
+                                               bitcoin_signature_1: if were_node_one { our_bitcoin_sig } else { msg.bitcoin_signature },
+                                               bitcoin_signature_2: if were_node_one { msg.bitcoin_signature } else { our_bitcoin_sig },
+                                               contents: announcement,
+                                       }, self.get_channel_update(chan).unwrap()) // can only fail if we're not in a ready state
+                               },
+                               None => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.channel_id))
+                       }
+               };
+               let mut pending_events = self.pending_events.lock().unwrap();
+               pending_events.push(events::Event::BroadcastChannelAnnouncement { msg: chan_announcement, update_msg: chan_update });
+               Ok(())
+       }
 
-               if pending_forward_info.onion_packet.is_some() { // If short_channel_id is 0 here, we'll reject them in the body here
-                       let forwarding_id = match channel_state.short_to_id.get(&pending_forward_info.short_channel_id) {
-                               None => {
-                                       return_err!("Don't have available channel for forwarding as requested.", 0x4000 | 10, &[0;0]);
+       fn internal_channel_reestablish(&self, their_node_id: &PublicKey, msg: &msgs::ChannelReestablish) -> Result<(Option<msgs::FundingLocked>, Option<msgs::RevokeAndACK>, Option<msgs::CommitmentUpdate>), MsgHandleErrInternal> {
+               let (res, chan_monitor) = {
+                       let mut channel_state = self.channel_state.lock().unwrap();
+                       match channel_state.by_id.get_mut(&msg.channel_id) {
+                               Some(chan) => {
+                                       if chan.get_their_node_id() != *their_node_id {
+                                               return Err(MsgHandleErrInternal::send_err_msg_no_close("Got a message for a channel from the wrong node!", msg.channel_id));
+                                       }
+                                       let (funding_locked, revoke_and_ack, commitment_update, channel_monitor) = chan.channel_reestablish(msg).map_err(|e| MsgHandleErrInternal::from_maybe_close(e))?;
+                                       (Ok((funding_locked, revoke_and_ack, commitment_update)), channel_monitor)
                                },
-                               Some(id) => id.clone(),
-                       };
-                       let chan = channel_state.by_id.get_mut(&forwarding_id).unwrap();
-                       let fee = chan.get_our_fee_base_msat(&*self.fee_estimator) + (pending_forward_info.amt_to_forward * self.fee_proportional_millionths as u64 / 1000000) as u32;
-                       if msg.amount_msat < fee as u64 || (msg.amount_msat - fee as u64) < pending_forward_info.amt_to_forward {
-                               log_debug!(self, "HTLC {} incorrect amount: in {} out {} fee required {}", msg.htlc_id, msg.amount_msat, pending_forward_info.amt_to_forward, fee);
-                               let chan_update = self.get_channel_update(chan).unwrap();
-                               return_err!("Prior hop has deviated from specified fees parameters or origin node has obsolete ones", 0x1000 | 12, &chan_update.encode_with_len()[..]);
+                               None => return Err(MsgHandleErrInternal::send_err_msg_no_close("Failed to find corresponding channel", msg.channel_id))
                        }
-                       if (msg.cltv_expiry as u64) < pending_forward_info.outgoing_cltv_value as u64 + CLTV_EXPIRY_DELTA as u64 {
-                               log_debug!(self, "HTLC {} incorrect CLTV: in {} out {} delta required {}", msg.htlc_id, msg.cltv_expiry, pending_forward_info.outgoing_cltv_value, CLTV_EXPIRY_DELTA);
-                               let chan_update = self.get_channel_update(chan).unwrap();
-                               return_err!("Forwarding node has tampered with the intended HTLC values or origin node has an obsolete cltv_expiry_delta", 0x1000 | 13, &chan_update.encode_with_len()[..]);
+               };
+               if let Some(monitor) = chan_monitor {
+                       if let Err(_e) = self.monitor.add_update_monitor(monitor.get_funding_txo().unwrap(), monitor) {
+                               unimplemented!();
                        }
-                       if !chan.is_live() {
-                               let chan_update = self.get_channel_update(chan).unwrap();
-                               return_err!("Forwarding channel is not in a ready state.", 0x1000 | 7, &chan_update.encode_with_len()[..]);
+               }
+               res
+       }
+}
+
+impl events::EventsProvider for ChannelManager {
+       fn get_and_clear_pending_events(&self) -> Vec<events::Event> {
+               let mut pending_events = self.pending_events.lock().unwrap();
+               let mut ret = Vec::new();
+               mem::swap(&mut ret, &mut *pending_events);
+               ret
+       }
+}
+
+impl ChainListener for ChannelManager {
+       fn block_connected(&self, header: &BlockHeader, height: u32, txn_matched: &[&Transaction], indexes_of_txn_matched: &[u32]) {
+               let mut new_events = Vec::new();
+               let mut failed_channels = Vec::new();
+               {
+                       let mut channel_lock = self.channel_state.lock().unwrap();
+                       let channel_state = channel_lock.borrow_parts();
+                       let short_to_id = channel_state.short_to_id;
+                       channel_state.by_id.retain(|_, channel| {
+                               let chan_res = channel.block_connected(header, height, txn_matched, indexes_of_txn_matched);
+                               if let Ok(Some(funding_locked)) = chan_res {
+                                       let announcement_sigs = self.get_announcement_sigs(channel);
+                                       new_events.push(events::Event::SendFundingLocked {
+                                               node_id: channel.get_their_node_id(),
+                                               msg: funding_locked,
+                                               announcement_sigs: announcement_sigs
+                                       });
+                                       short_to_id.insert(channel.get_short_channel_id().unwrap(), channel.channel_id());
+                               } else if let Err(e) = chan_res {
+                                       new_events.push(events::Event::HandleError {
+                                               node_id: channel.get_their_node_id(),
+                                               action: e.action,
+                                       });
+                                       if channel.is_shutdown() {
+                                               return false;
+                                       }
+                               }
+                               if let Some(funding_txo) = channel.get_funding_txo() {
+                                       for tx in txn_matched {
+                                               for inp in tx.input.iter() {
+                                                       if inp.previous_output == funding_txo.into_bitcoin_outpoint() {
+                                                               if let Some(short_id) = channel.get_short_channel_id() {
+                                                                       short_to_id.remove(&short_id);
+                                                               }
+                                                               // It looks like our counterparty went on-chain. We go ahead and
+                                                               // broadcast our latest local state as well here, just in case its
+                                                               // some kind of SPV attack, though we expect these to be dropped.
+                                                               failed_channels.push(channel.force_shutdown());
+                                                               if let Ok(update) = self.get_channel_update(&channel) {
+                                                                       new_events.push(events::Event::BroadcastChannelUpdate {
+                                                                               msg: update
+                                                                       });
+                                                               }
+                                                               return false;
+                                                       }
+                                               }
+                                       }
+                               }
+                               if channel.is_funding_initiated() && channel.channel_monitor().would_broadcast_at_height(height) {
+                                       if let Some(short_id) = channel.get_short_channel_id() {
+                                               short_to_id.remove(&short_id);
+                                       }
+                                       failed_channels.push(channel.force_shutdown());
+                                       // If would_broadcast_at_height() is true, the channel_monitor will broadcast
+                                       // the latest local tx for us, so we should skip that here (it doesn't really
+                                       // hurt anything, but does make tests a bit simpler).
+                                       failed_channels.last_mut().unwrap().0 = Vec::new();
+                                       if let Ok(update) = self.get_channel_update(&channel) {
+                                               new_events.push(events::Event::BroadcastChannelUpdate {
+                                                       msg: update
+                                               });
+                                       }
+                                       return false;
+                               }
+                               true
+                       });
+               }
+               for failure in failed_channels.drain(..) {
+                       self.finish_force_close_channel(failure);
+               }
+               let mut pending_events = self.pending_events.lock().unwrap();
+               for funding_locked in new_events.drain(..) {
+                       pending_events.push(funding_locked);
+               }
+               self.latest_block_height.store(height as usize, Ordering::Release);
+       }
+
+       /// We force-close the channel without letting our counterparty participate in the shutdown
+       fn block_disconnected(&self, header: &BlockHeader) {
+               let mut new_events = Vec::new();
+               let mut failed_channels = Vec::new();
+               {
+                       let mut channel_lock = self.channel_state.lock().unwrap();
+                       let channel_state = channel_lock.borrow_parts();
+                       let short_to_id = channel_state.short_to_id;
+                       channel_state.by_id.retain(|_,  v| {
+                               if v.block_disconnected(header) {
+                                       if let Some(short_id) = v.get_short_channel_id() {
+                                               short_to_id.remove(&short_id);
+                                       }
+                                       failed_channels.push(v.force_shutdown());
+                                       if let Ok(update) = self.get_channel_update(&v) {
+                                               new_events.push(events::Event::BroadcastChannelUpdate {
+                                                       msg: update
+                                               });
+                                       }
+                                       false
+                               } else {
+                                       true
+                               }
+                       });
+               }
+               for failure in failed_channels.drain(..) {
+                       self.finish_force_close_channel(failure);
+               }
+               if !new_events.is_empty() {
+                       let mut pending_events = self.pending_events.lock().unwrap();
+                       for funding_locked in new_events.drain(..) {
+                               pending_events.push(funding_locked);
                        }
                }
+               self.latest_block_height.fetch_sub(1, Ordering::AcqRel);
+       }
+}
+
+macro_rules! handle_error {
+       ($self: ident, $internal: expr, $their_node_id: expr) => {
+               match $internal {
+                       Ok(msg) => Ok(msg),
+                       Err(MsgHandleErrInternal { err, needs_channel_force_close }) => {
+                               if needs_channel_force_close {
+                                       match &err.action {
+                                               &Some(msgs::ErrorAction::DisconnectPeer { msg: Some(ref msg) }) => {
+                                                       if msg.channel_id == [0; 32] {
+                                                               $self.peer_disconnected(&$their_node_id, true);
+                                                       } else {
+                                                               $self.force_close_channel(&msg.channel_id);
+                                                       }
+                                               },
+                                               &Some(msgs::ErrorAction::DisconnectPeer { msg: None }) => {},
+                                               &Some(msgs::ErrorAction::IgnoreError) => {},
+                                               &Some(msgs::ErrorAction::SendErrorMessage { ref msg }) => {
+                                                       if msg.channel_id == [0; 32] {
+                                                               $self.peer_disconnected(&$their_node_id, true);
+                                                       } else {
+                                                               $self.force_close_channel(&msg.channel_id);
+                                                       }
+                                               },
+                                               &None => {},
+                                       }
+                               }
+                               Err(err)
+                       },
+               }
+       }
+}
+
+impl ChannelMessageHandler for ChannelManager {
+       //TODO: Handle errors and close channel (or so)
+       fn handle_open_channel(&self, their_node_id: &PublicKey, msg: &msgs::OpenChannel) -> Result<msgs::AcceptChannel, HandleError> {
+               handle_error!(self, self.internal_open_channel(their_node_id, msg), their_node_id)
+       }
+
+       fn handle_accept_channel(&self, their_node_id: &PublicKey, msg: &msgs::AcceptChannel) -> Result<(), HandleError> {
+               handle_error!(self, self.internal_accept_channel(their_node_id, msg), their_node_id)
+       }
+
+       fn handle_funding_created(&self, their_node_id: &PublicKey, msg: &msgs::FundingCreated) -> Result<msgs::FundingSigned, HandleError> {
+               handle_error!(self, self.internal_funding_created(their_node_id, msg), their_node_id)
+       }
 
-               let claimable_htlcs_entry = channel_state.claimable_htlcs.entry(msg.payment_hash.clone());
+       fn handle_funding_signed(&self, their_node_id: &PublicKey, msg: &msgs::FundingSigned) -> Result<(), HandleError> {
+               handle_error!(self, self.internal_funding_signed(their_node_id, msg), their_node_id)
+       }
 
-               // We dont correctly handle payments that route through us twice on their way to their
-               // destination. That's OK since those nodes are probably busted or trying to do network
-               // mapping through repeated loops. In either case, we want them to stop talking to us, so
-               // we send permanent_node_failure.
-               if let &hash_map::Entry::Occupied(ref e) = &claimable_htlcs_entry {
-                       let mut acceptable_cycle = false;
-                       if let &PendingOutboundHTLC::OutboundRoute { .. } = e.get() {
-                               acceptable_cycle = pending_forward_info.short_channel_id == 0;
-                       }
-                       if !acceptable_cycle {
-                               return_err!("Payment looped through us twice", 0x4000 | 0x2000 | 2, &[0;0]);
-                       }
-               }
+       fn handle_funding_locked(&self, their_node_id: &PublicKey, msg: &msgs::FundingLocked) -> Result<Option<msgs::AnnouncementSignatures>, HandleError> {
+               handle_error!(self, self.internal_funding_locked(their_node_id, msg), their_node_id)
+       }
 
-               let (source_short_channel_id, res) = match channel_state.by_id.get_mut(&msg.channel_id) {
-                       Some(chan) => {
-                               if chan.get_their_node_id() != *their_node_id {
-                                       return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
-                               }
-                               if !chan.is_usable() {
-                                       return Err(HandleError{err: "Channel not yet available for receiving HTLCs", action: None});
-                               }
-                               let short_channel_id = chan.get_short_channel_id().unwrap();
-                               pending_forward_info.prev_short_channel_id = short_channel_id;
-                               (short_channel_id, chan.update_add_htlc(&msg, pending_forward_info)?)
-                       },
-                       None => return Err(HandleError{err: "Failed to find corresponding channel", action: None}),
-               };
+       fn handle_shutdown(&self, their_node_id: &PublicKey, msg: &msgs::Shutdown) -> Result<(Option<msgs::Shutdown>, Option<msgs::ClosingSigned>), HandleError> {
+               handle_error!(self, self.internal_shutdown(their_node_id, msg), their_node_id)
+       }
 
-               match claimable_htlcs_entry {
-                       hash_map::Entry::Occupied(mut e) => {
-                               let outbound_route = e.get_mut();
-                               let (route, session_priv) = match outbound_route {
-                                       &mut PendingOutboundHTLC::OutboundRoute { ref route, ref session_priv } => {
-                                               (route.clone(), session_priv.clone())
-                                       },
-                                       _ => unreachable!(),
-                               };
-                               *outbound_route = PendingOutboundHTLC::CycledRoute {
-                                       source_short_channel_id,
-                                       incoming_packet_shared_secret: shared_secret,
-                                       route,
-                                       session_priv,
-                               };
-                       },
-                       hash_map::Entry::Vacant(e) => {
-                               e.insert(PendingOutboundHTLC::IntermediaryHopData {
-                                       source_short_channel_id,
-                                       incoming_packet_shared_secret: shared_secret,
-                               });
-                       }
-               }
+       fn handle_closing_signed(&self, their_node_id: &PublicKey, msg: &msgs::ClosingSigned) -> Result<Option<msgs::ClosingSigned>, HandleError> {
+               handle_error!(self, self.internal_closing_signed(their_node_id, msg), their_node_id)
+       }
 
-               Ok(res)
+       fn handle_update_add_htlc(&self, their_node_id: &PublicKey, msg: &msgs::UpdateAddHTLC) -> Result<(), msgs::HandleError> {
+               handle_error!(self, self.internal_update_add_htlc(their_node_id, msg), their_node_id)
        }
 
        fn handle_update_fulfill_htlc(&self, their_node_id: &PublicKey, msg: &msgs::UpdateFulfillHTLC) -> Result<(), HandleError> {
-               //TODO: Delay the claimed_funds relaying just like we do outbound relay!
-               // Claim funds first, cause we don't really care if the channel we received the message on
-               // is broken, we may have enough info to get our own money!
-               self.claim_funds_internal(msg.payment_preimage.clone(), false);
-
-               let mut channel_state = self.channel_state.lock().unwrap();
-               match channel_state.by_id.get_mut(&msg.channel_id) {
-                       Some(chan) => {
-                               if chan.get_their_node_id() != *their_node_id {
-                                       return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
-                               }
-                               chan.update_fulfill_htlc(&msg)
-                       },
-                       None => return Err(HandleError{err: "Failed to find corresponding channel", action: None})
-               }
+               handle_error!(self, self.internal_update_fulfill_htlc(their_node_id, msg), their_node_id)
        }
 
        fn handle_update_fail_htlc(&self, their_node_id: &PublicKey, msg: &msgs::UpdateFailHTLC) -> Result<Option<msgs::HTLCFailChannelUpdate>, HandleError> {
-               let mut channel_state = self.channel_state.lock().unwrap();
-               let payment_hash = match channel_state.by_id.get_mut(&msg.channel_id) {
-                       Some(chan) => {
-                               if chan.get_their_node_id() != *their_node_id {
-                                       return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
-                               }
-                               chan.update_fail_htlc(&msg, HTLCFailReason::ErrorPacket { err: msg.reason.clone() })
-                       },
-                       None => return Err(HandleError{err: "Failed to find corresponding channel", action: None})
-               }?;
-
-               if let Some(pending_htlc) = channel_state.claimable_htlcs.get(&payment_hash) {
-                       match pending_htlc {
-                               &PendingOutboundHTLC::OutboundRoute { ref route, ref session_priv } => {
-                                       // Handle packed channel/node updates for passing back for the route handler
-                                       let mut packet_decrypted = msg.reason.data.clone();
-                                       let mut res = None;
-                                       Self::construct_onion_keys_callback(&self.secp_ctx, &route, &session_priv, |shared_secret, _, _, route_hop| {
-                                               if res.is_some() { return; }
-
-                                               let ammag = ChannelManager::gen_ammag_from_shared_secret(&shared_secret);
-
-                                               let mut decryption_tmp = Vec::with_capacity(packet_decrypted.len());
-                                               decryption_tmp.resize(packet_decrypted.len(), 0);
-                                               let mut chacha = ChaCha20::new(&ammag, &[0u8; 8]);
-                                               chacha.process(&packet_decrypted, &mut decryption_tmp[..]);
-                                               packet_decrypted = decryption_tmp;
-
-                                               if let Ok(err_packet) = msgs::DecodedOnionErrorPacket::decode(&packet_decrypted) {
-                                                       if err_packet.failuremsg.len() >= 2 {
-                                                               let um = ChannelManager::gen_um_from_shared_secret(&shared_secret);
-
-                                                               let mut hmac = Hmac::new(Sha256::new(), &um);
-                                                               hmac.input(&err_packet.encode()[32..]);
-                                                               let mut calc_tag = [0u8; 32];
-                                                               hmac.raw_result(&mut calc_tag);
-                                                               if crypto::util::fixed_time_eq(&calc_tag, &err_packet.hmac) {
-                                                                       const UNKNOWN_CHAN: u16 = 0x4000|10;
-                                                                       const TEMP_CHAN_FAILURE: u16 = 0x4000|7;
-                                                                       match byte_utils::slice_to_be16(&err_packet.failuremsg[0..2]) {
-                                                                               TEMP_CHAN_FAILURE => {
-                                                                                       if err_packet.failuremsg.len() >= 4 {
-                                                                                               let update_len = byte_utils::slice_to_be16(&err_packet.failuremsg[2..4]) as usize;
-                                                                                               if err_packet.failuremsg.len() >= 4 + update_len {
-                                                                                                       if let Ok(chan_update) = msgs::ChannelUpdate::decode(&err_packet.failuremsg[4..4 + update_len]) {
-                                                                                                               res = Some(msgs::HTLCFailChannelUpdate::ChannelUpdateMessage {
-                                                                                                                       msg: chan_update,
-                                                                                                               });
-                                                                                                       }
-                                                                                               }
-                                                                                       }
-                                                                               },
-                                                                               UNKNOWN_CHAN => {
-                                                                                       // No such next-hop. We know this came from the
-                                                                                       // current node as the HMAC validated.
-                                                                                       res = Some(msgs::HTLCFailChannelUpdate::ChannelClosed {
-                                                                                               short_channel_id: route_hop.short_channel_id
-                                                                                       });
-                                                                               },
-                                                                               _ => {}, //TODO: Enumerate all of these!
-                                                                       }
-                                                               }
-                                                       }
-                                               }
-                                       }).unwrap();
-                                       Ok(res)
-                               },
-                               _ => { Ok(None) },
-                       }
-               } else {
-                       Ok(None)
-               }
+               handle_error!(self, self.internal_update_fail_htlc(their_node_id, msg), their_node_id)
        }
 
        fn handle_update_fail_malformed_htlc(&self, their_node_id: &PublicKey, msg: &msgs::UpdateFailMalformedHTLC) -> Result<(), HandleError> {
-               let mut channel_state = self.channel_state.lock().unwrap();
-               match channel_state.by_id.get_mut(&msg.channel_id) {
-                       Some(chan) => {
-                               if chan.get_their_node_id() != *their_node_id {
-                                       return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
-                               }
-                               chan.update_fail_malformed_htlc(&msg, HTLCFailReason::Reason { failure_code: msg.failure_code, data: Vec::new() })
-                       },
-                       None => return Err(HandleError{err: "Failed to find corresponding channel", action: None})
-               }
+               handle_error!(self, self.internal_update_fail_malformed_htlc(their_node_id, msg), their_node_id)
        }
 
        fn handle_commitment_signed(&self, their_node_id: &PublicKey, msg: &msgs::CommitmentSigned) -> Result<(msgs::RevokeAndACK, Option<msgs::CommitmentSigned>), HandleError> {
-               let (revoke_and_ack, commitment_signed, chan_monitor) = {
-                       let mut channel_state = self.channel_state.lock().unwrap();
-                       match channel_state.by_id.get_mut(&msg.channel_id) {
-                               Some(chan) => {
-                                       if chan.get_their_node_id() != *their_node_id {
-                                               return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
-                                       }
-                                       chan.commitment_signed(&msg)?
-                               },
-                               None => return Err(HandleError{err: "Failed to find corresponding channel", action: None})
-                       }
-               };
-               if let Err(_e) = self.monitor.add_update_monitor(chan_monitor.get_funding_txo().unwrap(), chan_monitor) {
-                       unimplemented!();
-               }
-
-               Ok((revoke_and_ack, commitment_signed))
+               handle_error!(self, self.internal_commitment_signed(their_node_id, msg), their_node_id)
        }
 
        fn handle_revoke_and_ack(&self, their_node_id: &PublicKey, msg: &msgs::RevokeAndACK) -> Result<Option<msgs::CommitmentUpdate>, HandleError> {
-               let (res, mut pending_forwards, mut pending_failures, chan_monitor) = {
-                       let mut channel_state = self.channel_state.lock().unwrap();
-                       match channel_state.by_id.get_mut(&msg.channel_id) {
-                               Some(chan) => {
-                                       if chan.get_their_node_id() != *their_node_id {
-                                               return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
-                                       }
-                                       chan.revoke_and_ack(&msg)?
-                               },
-                               None => return Err(HandleError{err: "Failed to find corresponding channel", action: None})
-                       }
-               };
-               if let Err(_e) = self.monitor.add_update_monitor(chan_monitor.get_funding_txo().unwrap(), chan_monitor) {
-                       unimplemented!();
-               }
-               for failure in pending_failures.drain(..) {
-                       self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), &failure.0, failure.1);
-               }
-
-               let mut forward_event = None;
-               if !pending_forwards.is_empty() {
-                       let mut channel_state = self.channel_state.lock().unwrap();
-                       if channel_state.forward_htlcs.is_empty() {
-                               forward_event = Some(Instant::now() + Duration::from_millis(((rng::rand_f32() * 4.0 + 1.0) * MIN_HTLC_RELAY_HOLDING_CELL_MILLIS as f32) as u64));
-                               channel_state.next_forward = forward_event.unwrap();
-                       }
-                       for forward_info in pending_forwards.drain(..) {
-                               match channel_state.forward_htlcs.entry(forward_info.short_channel_id) {
-                                       hash_map::Entry::Occupied(mut entry) => {
-                                               entry.get_mut().push(forward_info);
-                                       },
-                                       hash_map::Entry::Vacant(entry) => {
-                                               entry.insert(vec!(forward_info));
-                                       }
-                               }
-                       }
-               }
-               match forward_event {
-                       Some(time) => {
-                               let mut pending_events = self.pending_events.lock().unwrap();
-                               pending_events.push(events::Event::PendingHTLCsForwardable {
-                                       time_forwardable: time
-                               });
-                       }
-                       None => {},
-               }
-
-               Ok(res)
+               handle_error!(self, self.internal_revoke_and_ack(their_node_id, msg), their_node_id)
        }
 
        fn handle_update_fee(&self, their_node_id: &PublicKey, msg: &msgs::UpdateFee) -> Result<(), HandleError> {
-               let mut channel_state = self.channel_state.lock().unwrap();
-               match channel_state.by_id.get_mut(&msg.channel_id) {
-                       Some(chan) => {
-                               if chan.get_their_node_id() != *their_node_id {
-                                       return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
-                               }
-                               chan.update_fee(&*self.fee_estimator, &msg)
-                       },
-                       None => return Err(HandleError{err: "Failed to find corresponding channel", action: None})
-               }
+               handle_error!(self, self.internal_update_fee(their_node_id, msg), their_node_id)
        }
 
        fn handle_announcement_signatures(&self, their_node_id: &PublicKey, msg: &msgs::AnnouncementSignatures) -> Result<(), HandleError> {
-               let (chan_announcement, chan_update) = {
-                       let mut channel_state = self.channel_state.lock().unwrap();
-                       match channel_state.by_id.get_mut(&msg.channel_id) {
-                               Some(chan) => {
-                                       if chan.get_their_node_id() != *their_node_id {
-                                               return Err(HandleError{err: "Got a message for a channel from the wrong node!", action: None})
-                                       }
-                                       if !chan.is_usable() {
-                                               return Err(HandleError{err: "Got an announcement_signatures before we were ready for it", action: None });
-                                       }
-
-                                       let our_node_id = self.get_our_node_id();
-                                       let (announcement, our_bitcoin_sig) = chan.get_channel_announcement(our_node_id.clone(), self.genesis_hash.clone())?;
-
-                                       let were_node_one = announcement.node_id_1 == our_node_id;
-                                       let msghash = Message::from_slice(&Sha256dHash::from_data(&announcement.encode()[..])[..]).unwrap();
-                                       secp_call!(self.secp_ctx.verify(&msghash, &msg.node_signature, if were_node_one { &announcement.node_id_2 } else { &announcement.node_id_1 }));
-                                       secp_call!(self.secp_ctx.verify(&msghash, &msg.bitcoin_signature, if were_node_one { &announcement.bitcoin_key_2 } else { &announcement.bitcoin_key_1 }));
-
-                                       let our_node_sig = self.secp_ctx.sign(&msghash, &self.our_network_key);
+               handle_error!(self, self.internal_announcement_signatures(their_node_id, msg), their_node_id)
+       }
 
-                                       (msgs::ChannelAnnouncement {
-                                               node_signature_1: if were_node_one { our_node_sig } else { msg.node_signature },
-                                               node_signature_2: if were_node_one { msg.node_signature } else { our_node_sig },
-                                               bitcoin_signature_1: if were_node_one { our_bitcoin_sig } else { msg.bitcoin_signature },
-                                               bitcoin_signature_2: if were_node_one { msg.bitcoin_signature } else { our_bitcoin_sig },
-                                               contents: announcement,
-                                       }, self.get_channel_update(chan).unwrap()) // can only fail if we're not in a ready state
-                               },
-                               None => return Err(HandleError{err: "Failed to find corresponding channel", action: None})
-                       }
-               };
-               let mut pending_events = self.pending_events.lock().unwrap();
-               pending_events.push(events::Event::BroadcastChannelAnnouncement { msg: chan_announcement, update_msg: chan_update });
-               Ok(())
+       fn handle_channel_reestablish(&self, their_node_id: &PublicKey, msg: &msgs::ChannelReestablish) -> Result<(Option<msgs::FundingLocked>, Option<msgs::RevokeAndACK>, Option<msgs::CommitmentUpdate>), HandleError> {
+               handle_error!(self, self.internal_channel_reestablish(their_node_id, msg), their_node_id)
        }
 
        fn peer_disconnected(&self, their_node_id: &PublicKey, no_connection_possible: bool) {
                let mut new_events = Vec::new();
                let mut failed_channels = Vec::new();
+               let mut failed_payments = Vec::new();
                {
                        let mut channel_state_lock = self.channel_state.lock().unwrap();
                        let channel_state = channel_state_lock.borrow_parts();
@@ -1982,13 +2146,23 @@ impl ChannelMessageHandler for ChannelManager {
                                        }
                                });
                        } else {
-                               for chan in channel_state.by_id {
-                                       if chan.1.get_their_node_id() == *their_node_id {
-                                               //TODO: mark channel disabled (and maybe announce such after a timeout). Also
-                                               //fail and wipe any uncommitted outbound HTLCs as those are considered after
-                                               //reconnect.
+                               channel_state.by_id.retain(|_, chan| {
+                                       if chan.get_their_node_id() == *their_node_id {
+                                               //TODO: mark channel disabled (and maybe announce such after a timeout).
+                                               let failed_adds = chan.remove_uncommitted_htlcs_and_mark_paused();
+                                               if !failed_adds.is_empty() {
+                                                       let chan_update = self.get_channel_update(&chan).map(|u| u.encode_with_len()).unwrap(); // Cannot add/recv HTLCs before we have a short_id so unwrap is safe
+                                                       failed_payments.push((chan_update, failed_adds));
+                                               }
+                                               if chan.is_shutdown() {
+                                                       if let Some(short_id) = chan.get_short_channel_id() {
+                                                               short_to_id.remove(&short_id);
+                                                       }
+                                                       return false;
+                                               }
                                        }
-                               }
+                                       true
+                               })
                        }
                }
                for failure in failed_channels.drain(..) {
@@ -2000,6 +2174,44 @@ impl ChannelMessageHandler for ChannelManager {
                                pending_events.push(event);
                        }
                }
+               for (chan_update, mut htlc_sources) in failed_payments {
+                       for (htlc_source, payment_hash) in htlc_sources.drain(..) {
+                               self.fail_htlc_backwards_internal(self.channel_state.lock().unwrap(), htlc_source, &payment_hash, HTLCFailReason::Reason { failure_code: 0x1000 | 7, data: chan_update.clone() });
+                       }
+               }
+       }
+
+       fn peer_connected(&self, their_node_id: &PublicKey) -> Vec<msgs::ChannelReestablish> {
+               let mut res = Vec::new();
+               let mut channel_state = self.channel_state.lock().unwrap();
+               channel_state.by_id.retain(|_, chan| {
+                       if chan.get_their_node_id() == *their_node_id {
+                               if !chan.have_received_message() {
+                                       // If we created this (outbound) channel while we were disconnected from the
+                                       // peer we probably failed to send the open_channel message, which is now
+                                       // lost. We can't have had anything pending related to this channel, so we just
+                                       // drop it.
+                                       false
+                               } else {
+                                       res.push(chan.get_channel_reestablish());
+                                       true
+                               }
+                       } else { true }
+               });
+               //TODO: Also re-broadcast announcement_signatures
+               res
+       }
+
+       fn handle_error(&self, their_node_id: &PublicKey, msg: &msgs::ErrorMessage) {
+               if msg.channel_id == [0; 32] {
+                       for chan in self.list_channels() {
+                               if chan.remote_network_id == *their_node_id {
+                                       self.force_close_channel(&chan.channel_id);
+                               }
+                       }
+               } else {
+                       self.force_close_channel(&msg.channel_id);
+               }
        }
 }
 
@@ -2011,21 +2223,24 @@ mod tests {
        use ln::channelmanager::{ChannelManager,OnionKeys};
        use ln::router::{Route, RouteHop, Router};
        use ln::msgs;
-       use ln::msgs::{MsgEncodable,ChannelMessageHandler,RoutingMessageHandler};
+       use ln::msgs::{ChannelMessageHandler,RoutingMessageHandler};
        use util::test_utils;
        use util::events::{Event, EventsProvider};
+       use util::errors::APIError;
        use util::logger::Logger;
+       use util::ser::Writeable;
 
        use bitcoin::util::hash::Sha256dHash;
        use bitcoin::blockdata::block::{Block, BlockHeader};
        use bitcoin::blockdata::transaction::{Transaction, TxOut};
+       use bitcoin::blockdata::constants::genesis_block;
        use bitcoin::network::constants::Network;
        use bitcoin::network::serialize::serialize;
        use bitcoin::network::serialize::BitcoinHash;
 
        use hex;
 
-       use secp256k1::Secp256k1;
+       use secp256k1::{Secp256k1, Message};
        use secp256k1::key::{PublicKey,SecretKey};
 
        use crypto::sha2::Sha256;
@@ -2033,8 +2248,10 @@ mod tests {
 
        use rand::{thread_rng,Rng};
 
+       use std::cell::RefCell;
        use std::collections::HashMap;
        use std::default::Default;
+       use std::rc::Rc;
        use std::sync::{Arc, Mutex};
        use std::time::Instant;
        use std::mem;
@@ -2159,7 +2376,7 @@ mod tests {
                        },
                );
 
-               let packet = ChannelManager::construct_onion_packet(payloads, onion_keys, &[0x42; 32]).unwrap();
+               let packet = ChannelManager::construct_onion_packet(payloads, onion_keys, &[0x42; 32]);
                // Just check the final packet encoding, as it includes all the per-hop vectors in it
                // anyway...
                assert_eq!(packet.encode(), hex::decode("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").unwrap());
@@ -2200,16 +2417,22 @@ mod tests {
        }
 
        struct Node {
-               feeest: Arc<test_utils::TestFeeEstimator>,
                chain_monitor: Arc<chaininterface::ChainWatchInterfaceUtil>,
                tx_broadcaster: Arc<test_utils::TestBroadcaster>,
                chan_monitor: Arc<test_utils::TestChannelMonitor>,
-               node_id: SecretKey,
                node: Arc<ChannelManager>,
                router: Router,
+               network_payment_count: Rc<RefCell<u8>>,
+               network_chan_count: Rc<RefCell<u32>>,
+       }
+       impl Drop for Node {
+               fn drop(&mut self) {
+                       // Check that we processed all pending events
+                       assert_eq!(self.node.get_and_clear_pending_events().len(), 0);
+                       assert_eq!(self.chan_monitor.added_monitors.lock().unwrap().len(), 0);
+               }
        }
 
-       static mut CHAN_COUNT: u32 = 0;
        fn create_chan_between_nodes(node_a: &Node, node_b: &Node) -> (msgs::ChannelAnnouncement, msgs::ChannelUpdate, msgs::ChannelUpdate, [u8; 32], Transaction) {
                node_a.node.create_channel(node_b.node.get_our_node_id(), 100000, 10001, 42).unwrap();
 
@@ -2225,7 +2448,7 @@ mod tests {
 
                node_a.node.handle_accept_channel(&node_b.node.get_our_node_id(), &accept_chan).unwrap();
 
-               let chan_id = unsafe { CHAN_COUNT };
+               let chan_id = *node_a.network_chan_count.borrow();
                let tx;
                let funding_output;
 
@@ -2331,9 +2554,7 @@ mod tests {
                        _ => panic!("Unexpected event"),
                };
 
-               unsafe {
-                       CHAN_COUNT += 1;
-               }
+               *node_a.network_chan_count.borrow_mut() += 1;
 
                ((*announcement).clone(), (*as_update).clone(), (*bs_update).clone(), channel_id, tx)
        }
@@ -2424,18 +2645,68 @@ mod tests {
        impl SendEvent {
                fn from_event(event: Event) -> SendEvent {
                        match event {
-                               Event::SendHTLCs { node_id, msgs, commitment_msg } => {
-                                       SendEvent { node_id: node_id, msgs: msgs, commitment_msg: commitment_msg }
+                               Event::UpdateHTLCs { node_id, updates: msgs::CommitmentUpdate { update_add_htlcs, update_fulfill_htlcs, update_fail_htlcs, update_fail_malformed_htlcs, commitment_signed } } => {
+                                       assert!(update_fulfill_htlcs.is_empty());
+                                       assert!(update_fail_htlcs.is_empty());
+                                       assert!(update_fail_malformed_htlcs.is_empty());
+                                       SendEvent { node_id: node_id, msgs: update_add_htlcs, commitment_msg: commitment_signed }
                                },
                                _ => panic!("Unexpected event type!"),
                        }
                }
        }
 
-       static mut PAYMENT_COUNT: u8 = 0;
+       macro_rules! commitment_signed_dance {
+               ($node_a: expr, $node_b: expr, $commitment_signed: expr, $fail_backwards: expr) => {
+                       {
+                               {
+                                       let added_monitors = $node_a.chan_monitor.added_monitors.lock().unwrap();
+                                       assert!(added_monitors.is_empty());
+                               }
+                               let (as_revoke_and_ack, as_commitment_signed) = $node_a.node.handle_commitment_signed(&$node_b.node.get_our_node_id(), &$commitment_signed).unwrap();
+                               {
+                                       let mut added_monitors = $node_a.chan_monitor.added_monitors.lock().unwrap();
+                                       assert_eq!(added_monitors.len(), 1);
+                                       added_monitors.clear();
+                               }
+                               {
+                                       let added_monitors = $node_b.chan_monitor.added_monitors.lock().unwrap();
+                                       assert!(added_monitors.is_empty());
+                               }
+                               assert!($node_b.node.handle_revoke_and_ack(&$node_a.node.get_our_node_id(), &as_revoke_and_ack).unwrap().is_none());
+                               {
+                                       let mut added_monitors = $node_b.chan_monitor.added_monitors.lock().unwrap();
+                                       assert_eq!(added_monitors.len(), 1);
+                                       added_monitors.clear();
+                               }
+                               let (bs_revoke_and_ack, bs_none) = $node_b.node.handle_commitment_signed(&$node_a.node.get_our_node_id(), &as_commitment_signed.unwrap()).unwrap();
+                               assert!(bs_none.is_none());
+                               {
+                                       let mut added_monitors = $node_b.chan_monitor.added_monitors.lock().unwrap();
+                                       assert_eq!(added_monitors.len(), 1);
+                                       added_monitors.clear();
+                               }
+                               if $fail_backwards {
+                                       assert!($node_a.node.get_and_clear_pending_events().is_empty());
+                               }
+                               assert!($node_a.node.handle_revoke_and_ack(&$node_b.node.get_our_node_id(), &bs_revoke_and_ack).unwrap().is_none());
+                               {
+                                       let mut added_monitors = $node_a.chan_monitor.added_monitors.lock().unwrap();
+                                       if $fail_backwards {
+                                               assert_eq!(added_monitors.len(), 2);
+                                               assert!(added_monitors[0].0 != added_monitors[1].0);
+                                       } else {
+                                               assert_eq!(added_monitors.len(), 1);
+                                       }
+                                       added_monitors.clear();
+                               }
+                       }
+               }
+       }
+
        fn send_along_route(origin_node: &Node, route: Route, expected_route: &[&Node], recv_value: u64) -> ([u8; 32], [u8; 32]) {
-               let our_payment_preimage = unsafe { [PAYMENT_COUNT; 32] };
-               unsafe { PAYMENT_COUNT += 1 };
+               let our_payment_preimage = [*origin_node.network_payment_count.borrow(); 32];
+               *origin_node.network_payment_count.borrow_mut() += 1;
                let our_payment_hash = {
                        let mut sha = Sha256::new();
                        sha.input(&our_payment_preimage[..]);
@@ -2467,26 +2738,7 @@ mod tests {
                                assert_eq!(added_monitors.len(), 0);
                        }
 
-                       let revoke_and_ack = node.node.handle_commitment_signed(&prev_node.node.get_our_node_id(), &payment_event.commitment_msg).unwrap();
-                       {
-                               let mut added_monitors = node.chan_monitor.added_monitors.lock().unwrap();
-                               assert_eq!(added_monitors.len(), 1);
-                               added_monitors.clear();
-                       }
-                       assert!(prev_node.node.handle_revoke_and_ack(&node.node.get_our_node_id(), &revoke_and_ack.0).unwrap().is_none());
-                       let prev_revoke_and_ack = prev_node.node.handle_commitment_signed(&node.node.get_our_node_id(), &revoke_and_ack.1.unwrap()).unwrap();
-                       {
-                               let mut added_monitors = prev_node.chan_monitor.added_monitors.lock().unwrap();
-                               assert_eq!(added_monitors.len(), 2);
-                               added_monitors.clear();
-                       }
-                       assert!(node.node.handle_revoke_and_ack(&prev_node.node.get_our_node_id(), &prev_revoke_and_ack.0).unwrap().is_none());
-                       assert!(prev_revoke_and_ack.1.is_none());
-                       {
-                               let mut added_monitors = node.chan_monitor.added_monitors.lock().unwrap();
-                               assert_eq!(added_monitors.len(), 1);
-                               added_monitors.clear();
-                       }
+                       commitment_signed_dance!(node, prev_node, payment_event.commitment_msg, false);
 
                        let events_1 = node.node.get_and_clear_pending_events();
                        assert_eq!(events_1.len(), 1);
@@ -2524,7 +2776,7 @@ mod tests {
                (our_payment_preimage, our_payment_hash)
        }
 
-       fn claim_payment(origin_node: &Node, expected_route: &[&Node], our_payment_preimage: [u8; 32]) {
+       fn claim_payment_along_route(origin_node: &Node, expected_route: &[&Node], skip_last: bool, our_payment_preimage: [u8; 32]) {
                assert!(expected_route.last().unwrap().node.claim_funds(our_payment_preimage));
                {
                        let mut added_monitors = expected_route.last().unwrap().chan_monitor.added_monitors.lock().unwrap();
@@ -2546,62 +2798,58 @@ mod tests {
                                                }
                                                added_monitors.clear();
                                        }
-                                       let revoke_and_commit = $node.node.handle_commitment_signed(&$prev_node.node.get_our_node_id(), &next_msgs.as_ref().unwrap().1).unwrap();
-                                       {
-                                               let mut added_monitors = $node.chan_monitor.added_monitors.lock().unwrap();
-                                               assert_eq!(added_monitors.len(), 1);
-                                               added_monitors.clear();
-                                       }
-                                       assert!($prev_node.node.handle_revoke_and_ack(&$node.node.get_our_node_id(), &revoke_and_commit.0).unwrap().is_none());
-                                       let revoke_and_ack = $prev_node.node.handle_commitment_signed(&$node.node.get_our_node_id(), &revoke_and_commit.1.unwrap()).unwrap();
-                                       assert!(revoke_and_ack.1.is_none());
-                                       {
-                                               let mut added_monitors = $prev_node.chan_monitor.added_monitors.lock().unwrap();
-                                               assert_eq!(added_monitors.len(), 2);
-                                               added_monitors.clear();
-                                       }
-                                       assert!($node.node.handle_revoke_and_ack(&$prev_node.node.get_our_node_id(), &revoke_and_ack.0).unwrap().is_none());
-                                       {
-                                               let mut added_monitors = $node.chan_monitor.added_monitors.lock().unwrap();
-                                               assert_eq!(added_monitors.len(), 1);
-                                               added_monitors.clear();
-                                       }
+                                       commitment_signed_dance!($node, $prev_node, next_msgs.as_ref().unwrap().1, false);
                                }
                        }
                }
 
                let mut expected_next_node = expected_route.last().unwrap().node.get_our_node_id();
                let mut prev_node = expected_route.last().unwrap();
-               for node in expected_route.iter().rev() {
+               for (idx, node) in expected_route.iter().rev().enumerate() {
                        assert_eq!(expected_next_node, node.node.get_our_node_id());
                        if next_msgs.is_some() {
                                update_fulfill_dance!(node, prev_node, false);
                        }
 
                        let events = node.node.get_and_clear_pending_events();
+                       if !skip_last || idx != expected_route.len() - 1 {
+                               assert_eq!(events.len(), 1);
+                               match events[0] {
+                                       Event::UpdateHTLCs { ref node_id, updates: msgs::CommitmentUpdate { ref update_add_htlcs, ref update_fulfill_htlcs, ref update_fail_htlcs, ref update_fail_malformed_htlcs, ref commitment_signed } } => {
+                                               assert!(update_add_htlcs.is_empty());
+                                               assert_eq!(update_fulfill_htlcs.len(), 1);
+                                               assert!(update_fail_htlcs.is_empty());
+                                               assert!(update_fail_malformed_htlcs.is_empty());
+                                               expected_next_node = node_id.clone();
+                                               next_msgs = Some((update_fulfill_htlcs[0].clone(), commitment_signed.clone()));
+                                       },
+                                       _ => panic!("Unexpected event"),
+                               }
+                       } else {
+                               assert!(events.is_empty());
+                       }
+                       if !skip_last && idx == expected_route.len() - 1 {
+                               assert_eq!(expected_next_node, origin_node.node.get_our_node_id());
+                       }
+
+                       prev_node = node;
+               }
+
+               if !skip_last {
+                       update_fulfill_dance!(origin_node, expected_route.first().unwrap(), true);
+                       let events = origin_node.node.get_and_clear_pending_events();
                        assert_eq!(events.len(), 1);
                        match events[0] {
-                               Event::SendFulfillHTLC { ref node_id, ref msg, ref commitment_msg } => {
-                                       expected_next_node = node_id.clone();
-                                       next_msgs = Some((msg.clone(), commitment_msg.clone()));
+                               Event::PaymentSent { payment_preimage } => {
+                                       assert_eq!(payment_preimage, our_payment_preimage);
                                },
                                _ => panic!("Unexpected event"),
-                       };
-
-                       prev_node = node;
+                       }
                }
+       }
 
-               assert_eq!(expected_next_node, origin_node.node.get_our_node_id());
-               update_fulfill_dance!(origin_node, expected_route.first().unwrap(), true);
-
-               let events = origin_node.node.get_and_clear_pending_events();
-               assert_eq!(events.len(), 1);
-               match events[0] {
-                       Event::PaymentSent { payment_preimage } => {
-                               assert_eq!(payment_preimage, our_payment_preimage);
-                       },
-                       _ => panic!("Unexpected event"),
-               }
+       fn claim_payment(origin_node: &Node, expected_route: &[&Node], our_payment_preimage: [u8; 32]) {
+               claim_payment_along_route(origin_node, expected_route, false, our_payment_preimage);
        }
 
        const TEST_FINAL_CLTV: u32 = 32;
@@ -2623,8 +2871,8 @@ mod tests {
                        assert_eq!(hop.pubkey, node.node.get_our_node_id());
                }
 
-               let our_payment_preimage = unsafe { [PAYMENT_COUNT; 32] };
-               unsafe { PAYMENT_COUNT += 1 };
+               let our_payment_preimage = [*origin_node.network_payment_count.borrow(); 32];
+               *origin_node.network_payment_count.borrow_mut() += 1;
                let our_payment_hash = {
                        let mut sha = Sha256::new();
                        sha.input(&our_payment_preimage[..]);
@@ -2634,7 +2882,10 @@ mod tests {
                };
 
                let err = origin_node.node.send_payment(route, our_payment_hash).err().unwrap();
-               assert_eq!(err.err, "Cannot send value that would put us over our max HTLC value in flight");
+               match err {
+                       APIError::RouteError{err} => assert_eq!(err, "Cannot send value that would put us over our max HTLC value in flight"),
+                       _ => panic!("Unknown error variants"),
+               };
        }
 
        fn send_payment(origin: &Node, expected_route: &[&Node], recv_value: u64) {
@@ -2642,7 +2893,7 @@ mod tests {
                claim_payment(&origin, expected_route, our_payment_preimage);
        }
 
-       fn fail_payment(origin_node: &Node, expected_route: &[&Node], our_payment_hash: [u8; 32]) {
+       fn fail_payment_along_route(origin_node: &Node, expected_route: &[&Node], skip_last: bool, our_payment_hash: [u8; 32]) {
                assert!(expected_route.last().unwrap().node.fail_htlc_backwards(&our_payment_hash));
                {
                        let mut added_monitors = expected_route.last().unwrap().chan_monitor.added_monitors.lock().unwrap();
@@ -2655,85 +2906,76 @@ mod tests {
                        ($node: expr, $prev_node: expr, $last_node: expr) => {
                                {
                                        $node.node.handle_update_fail_htlc(&$prev_node.node.get_our_node_id(), &next_msgs.as_ref().unwrap().0).unwrap();
-                                       let revoke_and_commit = $node.node.handle_commitment_signed(&$prev_node.node.get_our_node_id(), &next_msgs.as_ref().unwrap().1).unwrap();
-
-                                       {
-                                               let mut added_monitors = $node.chan_monitor.added_monitors.lock().unwrap();
-                                               assert_eq!(added_monitors.len(), 1);
-                                               added_monitors.clear();
-                                       }
-                                       assert!($prev_node.node.handle_revoke_and_ack(&$node.node.get_our_node_id(), &revoke_and_commit.0).unwrap().is_none());
-                                       {
-                                               let mut added_monitors = $prev_node.chan_monitor.added_monitors.lock().unwrap();
-                                               assert_eq!(added_monitors.len(), 1);
-                                               added_monitors.clear();
-                                       }
-                                       let revoke_and_ack = $prev_node.node.handle_commitment_signed(&$node.node.get_our_node_id(), &revoke_and_commit.1.unwrap()).unwrap();
-                                       {
-                                               let mut added_monitors = $prev_node.chan_monitor.added_monitors.lock().unwrap();
-                                               assert_eq!(added_monitors.len(), 1);
-                                               added_monitors.clear();
-                                       }
-                                       assert!(revoke_and_ack.1.is_none());
-                                       assert!($node.node.get_and_clear_pending_events().is_empty());
-                                       assert!($node.node.handle_revoke_and_ack(&$prev_node.node.get_our_node_id(), &revoke_and_ack.0).unwrap().is_none());
-                                       {
-                                               let mut added_monitors = $node.chan_monitor.added_monitors.lock().unwrap();
-                                               if $last_node {
-                                                       assert_eq!(added_monitors.len(), 1);
-                                               } else {
-                                                       assert_eq!(added_monitors.len(), 2);
-                                                       assert!(added_monitors[0].0 != added_monitors[1].0);
-                                               }
-                                               added_monitors.clear();
-                                       }
+                                       commitment_signed_dance!($node, $prev_node, next_msgs.as_ref().unwrap().1, !$last_node);
                                }
                        }
                }
 
                let mut expected_next_node = expected_route.last().unwrap().node.get_our_node_id();
                let mut prev_node = expected_route.last().unwrap();
-               for node in expected_route.iter().rev() {
+               for (idx, node) in expected_route.iter().rev().enumerate() {
                        assert_eq!(expected_next_node, node.node.get_our_node_id());
                        if next_msgs.is_some() {
-                               update_fail_dance!(node, prev_node, false);
+                               // We may be the "last node" for the purpose of the commitment dance if we're
+                               // skipping the last node (implying it is disconnected) and we're the
+                               // second-to-last node!
+                               update_fail_dance!(node, prev_node, skip_last && idx == expected_route.len() - 1);
                        }
 
                        let events = node.node.get_and_clear_pending_events();
-                       assert_eq!(events.len(), 1);
-                       match events[0] {
-                               Event::SendFailHTLC { ref node_id, ref msg, ref commitment_msg } => {
-                                       expected_next_node = node_id.clone();
-                                       next_msgs = Some((msg.clone(), commitment_msg.clone()));
-                               },
-                               _ => panic!("Unexpected event"),
-                       };
+                       if !skip_last || idx != expected_route.len() - 1 {
+                               assert_eq!(events.len(), 1);
+                               match events[0] {
+                                       Event::UpdateHTLCs { ref node_id, updates: msgs::CommitmentUpdate { ref update_add_htlcs, ref update_fulfill_htlcs, ref update_fail_htlcs, ref update_fail_malformed_htlcs, ref commitment_signed } } => {
+                                               assert!(update_add_htlcs.is_empty());
+                                               assert!(update_fulfill_htlcs.is_empty());
+                                               assert_eq!(update_fail_htlcs.len(), 1);
+                                               assert!(update_fail_malformed_htlcs.is_empty());
+                                               expected_next_node = node_id.clone();
+                                               next_msgs = Some((update_fail_htlcs[0].clone(), commitment_signed.clone()));
+                                       },
+                                       _ => panic!("Unexpected event"),
+                               }
+                       } else {
+                               assert!(events.is_empty());
+                       }
+                       if !skip_last && idx == expected_route.len() - 1 {
+                               assert_eq!(expected_next_node, origin_node.node.get_our_node_id());
+                       }
 
                        prev_node = node;
                }
 
-               assert_eq!(expected_next_node, origin_node.node.get_our_node_id());
-               update_fail_dance!(origin_node, expected_route.first().unwrap(), true);
+               if !skip_last {
+                       update_fail_dance!(origin_node, expected_route.first().unwrap(), true);
 
-               let events = origin_node.node.get_and_clear_pending_events();
-               assert_eq!(events.len(), 1);
-               match events[0] {
-                       Event::PaymentFailed { payment_hash } => {
-                               assert_eq!(payment_hash, our_payment_hash);
-                       },
-                       _ => panic!("Unexpected event"),
+                       let events = origin_node.node.get_and_clear_pending_events();
+                       assert_eq!(events.len(), 1);
+                       match events[0] {
+                               Event::PaymentFailed { payment_hash } => {
+                                       assert_eq!(payment_hash, our_payment_hash);
+                               },
+                               _ => panic!("Unexpected event"),
+                       }
                }
        }
 
+       fn fail_payment(origin_node: &Node, expected_route: &[&Node], our_payment_hash: [u8; 32]) {
+               fail_payment_along_route(origin_node, expected_route, false, our_payment_hash);
+       }
+
        fn create_network(node_count: usize) -> Vec<Node> {
                let mut nodes = Vec::new();
                let mut rng = thread_rng();
                let secp_ctx = Secp256k1::new();
                let logger: Arc<Logger> = Arc::new(test_utils::TestLogger::new());
 
+               let chan_count = Rc::new(RefCell::new(0));
+               let payment_count = Rc::new(RefCell::new(0));
+
                for _ in 0..node_count {
                        let feeest = Arc::new(test_utils::TestFeeEstimator { sat_per_kw: 253 });
-                       let chain_monitor = Arc::new(chaininterface::ChainWatchInterfaceUtil::new(Arc::clone(&logger)));
+                       let chain_monitor = Arc::new(chaininterface::ChainWatchInterfaceUtil::new(Network::Testnet, Arc::clone(&logger)));
                        let tx_broadcaster = Arc::new(test_utils::TestBroadcaster{txn_broadcasted: Mutex::new(Vec::new())});
                        let chan_monitor = Arc::new(test_utils::TestChannelMonitor::new(chain_monitor.clone(), tx_broadcaster.clone()));
                        let node_id = {
@@ -2742,8 +2984,11 @@ mod tests {
                                SecretKey::from_slice(&secp_ctx, &key_slice).unwrap()
                        };
                        let node = ChannelManager::new(node_id.clone(), 0, true, Network::Testnet, feeest.clone(), chan_monitor.clone(), chain_monitor.clone(), tx_broadcaster.clone(), Arc::clone(&logger)).unwrap();
-                       let router = Router::new(PublicKey::from_secret_key(&secp_ctx, &node_id), Arc::clone(&logger));
-                       nodes.push(Node { feeest, chain_monitor, tx_broadcaster, chan_monitor, node_id, node, router });
+                       let router = Router::new(PublicKey::from_secret_key(&secp_ctx, &node_id), chain_monitor.clone(), Arc::clone(&logger));
+                       nodes.push(Node { chain_monitor, tx_broadcaster, chan_monitor, node, router,
+                               network_payment_count: payment_count.clone(),
+                               network_chan_count: chan_count.clone(),
+                       });
                }
 
                nodes
@@ -2859,38 +3104,71 @@ mod tests {
                close_channel(&nodes[2], &nodes[3], &chan_3.2, chan_3.3, true);
                close_channel(&nodes[1], &nodes[3], &chan_4.2, chan_4.3, false);
                close_channel(&nodes[1], &nodes[3], &chan_5.2, chan_5.3, false);
+       }
 
-               // Check that we processed all pending events
-               for node in nodes {
-                       assert_eq!(node.node.get_and_clear_pending_events().len(), 0);
-                       assert_eq!(node.chan_monitor.added_monitors.lock().unwrap().len(), 0);
-               }
+       #[test]
+       fn duplicate_htlc_test() {
+               // Test that we accept duplicate payment_hash HTLCs across the network and that
+               // claiming/failing them are all separate and don't effect each other
+               let mut nodes = create_network(6);
+
+               // Create some initial channels to route via 3 to 4/5 from 0/1/2
+               create_announced_chan_between_nodes(&nodes, 0, 3);
+               create_announced_chan_between_nodes(&nodes, 1, 3);
+               create_announced_chan_between_nodes(&nodes, 2, 3);
+               create_announced_chan_between_nodes(&nodes, 3, 4);
+               create_announced_chan_between_nodes(&nodes, 3, 5);
+
+               let (payment_preimage, payment_hash) = route_payment(&nodes[0], &vec!(&nodes[3], &nodes[4])[..], 1000000);
+
+               *nodes[0].network_payment_count.borrow_mut() -= 1;
+               assert_eq!(route_payment(&nodes[1], &vec!(&nodes[3])[..], 1000000).0, payment_preimage);
+
+               *nodes[0].network_payment_count.borrow_mut() -= 1;
+               assert_eq!(route_payment(&nodes[2], &vec!(&nodes[3], &nodes[5])[..], 1000000).0, payment_preimage);
+
+               claim_payment(&nodes[0], &vec!(&nodes[3], &nodes[4])[..], payment_preimage);
+               fail_payment(&nodes[2], &vec!(&nodes[3], &nodes[5])[..], payment_hash);
+               claim_payment(&nodes[1], &vec!(&nodes[3])[..], payment_preimage);
        }
 
        #[derive(PartialEq)]
        enum HTLCType { NONE, TIMEOUT, SUCCESS }
+       /// Tests that the given node has broadcast transactions for the given Channel
+       ///
+       /// First checks that the latest local commitment tx has been broadcast, unless an explicit
+       /// commitment_tx is provided, which may be used to test that a remote commitment tx was
+       /// broadcast and the revoked outputs were claimed.
+       ///
+       /// Next tests that there is (or is not) a transaction that spends the commitment transaction
+       /// that appears to be the type of HTLC transaction specified in has_htlc_tx.
+       ///
+       /// All broadcast transactions must be accounted for in one of the above three types of we'll
+       /// also fail.
        fn test_txn_broadcast(node: &Node, chan: &(msgs::ChannelUpdate, msgs::ChannelUpdate, [u8; 32], Transaction), commitment_tx: Option<Transaction>, has_htlc_tx: HTLCType) -> Vec<Transaction> {
                let mut node_txn = node.tx_broadcaster.txn_broadcasted.lock().unwrap();
                assert!(node_txn.len() >= if commitment_tx.is_some() { 0 } else { 1 } + if has_htlc_tx == HTLCType::NONE { 0 } else { 1 });
 
                let mut res = Vec::with_capacity(2);
-
-               if let Some(explicit_tx) = commitment_tx {
-                       res.push(explicit_tx.clone());
-               } else {
-                       for tx in node_txn.iter() {
-                               if tx.input.len() == 1 && tx.input[0].previous_output.txid == chan.3.txid() {
-                                       let mut funding_tx_map = HashMap::new();
-                                       funding_tx_map.insert(chan.3.txid(), chan.3.clone());
-                                       tx.verify(&funding_tx_map).unwrap();
+               node_txn.retain(|tx| {
+                       if tx.input.len() == 1 && tx.input[0].previous_output.txid == chan.3.txid() {
+                               let mut funding_tx_map = HashMap::new();
+                               funding_tx_map.insert(chan.3.txid(), chan.3.clone());
+                               tx.verify(&funding_tx_map).unwrap();
+                               if commitment_tx.is_none() {
                                        res.push(tx.clone());
                                }
-                       }
+                               false
+                       } else { true }
+               });
+               if let Some(explicit_tx) = commitment_tx {
+                       res.push(explicit_tx.clone());
                }
+
                assert_eq!(res.len(), 1);
 
                if has_htlc_tx != HTLCType::NONE {
-                       for tx in node_txn.iter() {
+                       node_txn.retain(|tx| {
                                if tx.input.len() == 1 && tx.input[0].previous_output.txid == res[0].txid() {
                                        let mut funding_tx_map = HashMap::new();
                                        funding_tx_map.insert(res[0].txid(), res[0].clone());
@@ -2901,15 +3179,32 @@ mod tests {
                                                assert!(tx.lock_time == 0);
                                        }
                                        res.push(tx.clone());
-                                       break;
-                               }
-                       }
+                                       false
+                               } else { true }
+                       });
                        assert_eq!(res.len(), 2);
                }
-               node_txn.clear();
+
+               assert!(node_txn.is_empty());
                res
        }
 
+       /// Tests that the given node has broadcast a claim transaction against the provided revoked
+       /// HTLC transaction.
+       fn test_revoked_htlc_claim_txn_broadcast(node: &Node, revoked_tx: Transaction) {
+               let mut node_txn = node.tx_broadcaster.txn_broadcasted.lock().unwrap();
+               assert_eq!(node_txn.len(), 1);
+               node_txn.retain(|tx| {
+                       if tx.input.len() == 1 && tx.input[0].previous_output.txid == revoked_tx.txid() {
+                               let mut funding_tx_map = HashMap::new();
+                               funding_tx_map.insert(revoked_tx.txid(), revoked_tx.clone());
+                               tx.verify(&funding_tx_map).unwrap();
+                               false
+                       } else { true }
+               });
+               assert!(node_txn.is_empty());
+       }
+
        fn check_preimage_claim(node: &Node, prev_txn: &Vec<Transaction>) -> Vec<Transaction> {
                let mut node_txn = node.tx_broadcaster.txn_broadcasted.lock().unwrap();
 
@@ -3020,7 +3315,9 @@ mod tests {
                                        let events = $node.node.get_and_clear_pending_events();
                                        assert_eq!(events.len(), 1);
                                        match events[0] {
-                                               Event::SendFulfillHTLC { ref node_id, .. } => {
+                                               Event::UpdateHTLCs { ref node_id, updates: msgs::CommitmentUpdate { ref update_add_htlcs, ref update_fail_htlcs, .. } } => {
+                                                       assert!(update_add_htlcs.is_empty());
+                                                       assert!(update_fail_htlcs.is_empty());
                                                        assert_eq!(*node_id, $prev_node.node.get_our_node_id());
                                                },
                                                _ => panic!("Unexpected event"),
@@ -3060,7 +3357,7 @@ mod tests {
 
                        let node_txn = test_txn_broadcast(&nodes[3], &chan_4, None, HTLCType::TIMEOUT);
 
-                       // Claim the payment on nodes[3], giving it knowledge of the preimage
+                       // Claim the payment on nodes[4], giving it knowledge of the preimage
                        claim_funds!(nodes[4], nodes[3], payment_preimage_2);
 
                        header = BlockHeader { version: 0x20000000, prev_blockhash: Default::default(), merkle_root: Default::default(), time: 42, bits: 42, nonce: 42 };
@@ -3096,7 +3393,8 @@ mod tests {
                        nodes[1].chain_monitor.block_connected_with_filtering(&Block { header, txdata: vec![revoked_local_txn[0].clone()] }, 1);
                        {
                                let mut node_txn = nodes[1].tx_broadcaster.txn_broadcasted.lock().unwrap();
-                               assert_eq!(node_txn.len(), 2);
+                               assert_eq!(node_txn.len(), 3);
+                               assert_eq!(node_txn.pop().unwrap(), node_txn[0]); // An outpoint registration will result in a 2nd block_connected
                                assert_eq!(node_txn[0].input.len(), 1);
 
                                let mut funding_tx_map = HashMap::new();
@@ -3110,19 +3408,172 @@ mod tests {
                        let node_txn = test_txn_broadcast(&nodes[0], &chan_5, Some(revoked_local_txn[0].clone()), HTLCType::TIMEOUT);
                        header = BlockHeader { version: 0x20000000, prev_blockhash: header.bitcoin_hash(), merkle_root: Default::default(), time: 42, bits: 42, nonce: 42 };
                        nodes[1].chain_monitor.block_connected_with_filtering(&Block { header, txdata: vec![node_txn[1].clone()] }, 1);
-
-                       //TODO: At this point nodes[1] should claim the revoked HTLC-Timeout output, but that's
-                       //not yet implemented in ChannelMonitor
+                       test_revoked_htlc_claim_txn_broadcast(&nodes[1], node_txn[1].clone());
                }
                get_announce_close_broadcast_events(&nodes, 0, 1);
                assert_eq!(nodes[0].node.list_channels().len(), 0);
                assert_eq!(nodes[1].node.list_channels().len(), 0);
+       }
 
-               // Check that we processed all pending events
-               for node in nodes {
-                       assert_eq!(node.node.get_and_clear_pending_events().len(), 0);
-                       assert_eq!(node.chan_monitor.added_monitors.lock().unwrap().len(), 0);
+       #[test]
+       fn test_htlc_ignore_latest_remote_commitment() {
+               // Test that HTLC transactions spending the latest remote commitment transaction are simply
+               // ignored if we cannot claim them. This originally tickled an invalid unwrap().
+               let nodes = create_network(2);
+               create_announced_chan_between_nodes(&nodes, 0, 1);
+
+               route_payment(&nodes[0], &[&nodes[1]], 10000000);
+               nodes[0].node.force_close_channel(&nodes[0].node.list_channels()[0].channel_id);
+               {
+                       let events = nodes[0].node.get_and_clear_pending_events();
+                       assert_eq!(events.len(), 1);
+                       match events[0] {
+                               Event::BroadcastChannelUpdate { msg: msgs::ChannelUpdate { contents: msgs::UnsignedChannelUpdate { flags, .. }, .. } } => {
+                                       assert_eq!(flags & 0b10, 0b10);
+                               },
+                               _ => panic!("Unexpected event"),
+                       }
+               }
+
+               let node_txn = nodes[0].tx_broadcaster.txn_broadcasted.lock().unwrap();
+               assert_eq!(node_txn.len(), 2);
+
+               let header = BlockHeader { version: 0x20000000, prev_blockhash: Default::default(), merkle_root: Default::default(), time: 42, bits: 42, nonce: 42 };
+               nodes[1].chain_monitor.block_connected_checked(&header, 1, &[&node_txn[0], &node_txn[1]], &[1; 2]);
+
+               {
+                       let events = nodes[1].node.get_and_clear_pending_events();
+                       assert_eq!(events.len(), 1);
+                       match events[0] {
+                               Event::BroadcastChannelUpdate { msg: msgs::ChannelUpdate { contents: msgs::UnsignedChannelUpdate { flags, .. }, .. } } => {
+                                       assert_eq!(flags & 0b10, 0b10);
+                               },
+                               _ => panic!("Unexpected event"),
+                       }
+               }
+
+               // Duplicate the block_connected call since this may happen due to other listeners
+               // registering new transactions
+               nodes[1].chain_monitor.block_connected_checked(&header, 1, &[&node_txn[0], &node_txn[1]], &[1; 2]);
+       }
+
+       #[test]
+       fn test_force_close_fail_back() {
+               // Check which HTLCs are failed-backwards on channel force-closure
+               let mut nodes = create_network(3);
+               create_announced_chan_between_nodes(&nodes, 0, 1);
+               create_announced_chan_between_nodes(&nodes, 1, 2);
+
+               let route = nodes[0].router.get_route(&nodes[2].node.get_our_node_id(), None, &Vec::new(), 1000000, 42).unwrap();
+
+               let our_payment_preimage = [*nodes[0].network_payment_count.borrow(); 32];
+               *nodes[0].network_payment_count.borrow_mut() += 1;
+               let our_payment_hash = {
+                       let mut sha = Sha256::new();
+                       sha.input(&our_payment_preimage[..]);
+                       let mut ret = [0; 32];
+                       sha.result(&mut ret);
+                       ret
+               };
+
+               let mut payment_event = {
+                       nodes[0].node.send_payment(route, our_payment_hash).unwrap();
+                       {
+                               let mut added_monitors = nodes[0].chan_monitor.added_monitors.lock().unwrap();
+                               assert_eq!(added_monitors.len(), 1);
+                               added_monitors.clear();
+                       }
+
+                       let mut events = nodes[0].node.get_and_clear_pending_events();
+                       assert_eq!(events.len(), 1);
+                       SendEvent::from_event(events.remove(0))
+               };
+
+               nodes[1].node.handle_update_add_htlc(&nodes[0].node.get_our_node_id(), &payment_event.msgs[0]).unwrap();
+               commitment_signed_dance!(nodes[1], nodes[0], payment_event.commitment_msg, false);
+
+               let events_1 = nodes[1].node.get_and_clear_pending_events();
+               assert_eq!(events_1.len(), 1);
+               match events_1[0] {
+                       Event::PendingHTLCsForwardable { .. } => { },
+                       _ => panic!("Unexpected event"),
+               };
+
+               nodes[1].node.channel_state.lock().unwrap().next_forward = Instant::now();
+               nodes[1].node.process_pending_htlc_forwards();
+
+               let mut events_2 = nodes[1].node.get_and_clear_pending_events();
+               assert_eq!(events_2.len(), 1);
+               payment_event = SendEvent::from_event(events_2.remove(0));
+               assert_eq!(payment_event.msgs.len(), 1);
+
+               {
+                       let mut added_monitors = nodes[1].chan_monitor.added_monitors.lock().unwrap();
+                       assert_eq!(added_monitors.len(), 1);
+                       added_monitors.clear();
+               }
+
+               nodes[2].node.handle_update_add_htlc(&nodes[1].node.get_our_node_id(), &payment_event.msgs[0]).unwrap();
+               nodes[2].node.handle_commitment_signed(&nodes[1].node.get_our_node_id(), &payment_event.commitment_msg).unwrap();
+
+               {
+                       let mut added_monitors = nodes[2].chan_monitor.added_monitors.lock().unwrap();
+                       assert_eq!(added_monitors.len(), 1);
+                       added_monitors.clear();
+               }
+
+               // nodes[2] now has the latest commitment transaction, but hasn't revoked its previous
+               // state or updated nodes[1]' state. Now force-close and broadcast that commitment/HTLC
+               // transaction and ensure nodes[1] doesn't fail-backwards (this was originally a bug!).
+
+               nodes[2].node.force_close_channel(&payment_event.commitment_msg.channel_id);
+               let events_3 = nodes[2].node.get_and_clear_pending_events();
+               assert_eq!(events_3.len(), 1);
+               match events_3[0] {
+                       Event::BroadcastChannelUpdate { msg: msgs::ChannelUpdate { contents: msgs::UnsignedChannelUpdate { flags, .. }, .. } } => {
+                               assert_eq!(flags & 0b10, 0b10);
+                       },
+                       _ => panic!("Unexpected event"),
+               }
+
+               let tx = {
+                       let mut node_txn = nodes[2].tx_broadcaster.txn_broadcasted.lock().unwrap();
+                       // Note that we don't bother broadcasting the HTLC-Success transaction here as we don't
+                       // have a use for it unless nodes[2] learns the preimage somehow, the funds will go
+                       // back to nodes[1] upon timeout otherwise.
+                       assert_eq!(node_txn.len(), 1);
+                       node_txn.remove(0)
+               };
+
+               let header = BlockHeader { version: 0x20000000, prev_blockhash: Default::default(), merkle_root: Default::default(), time: 42, bits: 42, nonce: 42 };
+               nodes[1].chain_monitor.block_connected_checked(&header, 1, &[&tx], &[1]);
+
+               let events_4 = nodes[1].node.get_and_clear_pending_events();
+               // Note no UpdateHTLCs event here from nodes[1] to nodes[0]!
+               assert_eq!(events_4.len(), 1);
+               match events_4[0] {
+                       Event::BroadcastChannelUpdate { msg: msgs::ChannelUpdate { contents: msgs::UnsignedChannelUpdate { flags, .. }, .. } } => {
+                               assert_eq!(flags & 0b10, 0b10);
+                       },
+                       _ => panic!("Unexpected event"),
+               }
+
+               // Now check that if we add the preimage to ChannelMonitor it broadcasts our HTLC-Success..
+               {
+                       let mut monitors = nodes[2].chan_monitor.simple_monitor.monitors.lock().unwrap();
+                       monitors.get_mut(&OutPoint::new(Sha256dHash::from(&payment_event.commitment_msg.channel_id[..]), 0)).unwrap()
+                               .provide_payment_preimage(&our_payment_hash, &our_payment_preimage);
                }
+               nodes[2].chain_monitor.block_connected_checked(&header, 1, &[&tx], &[1]);
+               let node_txn = nodes[2].tx_broadcaster.txn_broadcasted.lock().unwrap();
+               assert_eq!(node_txn.len(), 1);
+               assert_eq!(node_txn[0].input.len(), 1);
+               assert_eq!(node_txn[0].input[0].previous_output.txid, tx.txid());
+               assert_eq!(node_txn[0].lock_time, 0); // Must be an HTLC-Success
+               assert_eq!(node_txn[0].input[0].witness.len(), 5); // Must be an HTLC-Success
+               let mut funding_tx_map = HashMap::new();
+               funding_tx_map.insert(tx.txid(), tx);
+               node_txn[0].verify(&funding_tx_map).unwrap();
        }
 
        #[test]
@@ -3146,8 +3597,235 @@ mod tests {
                while !headers.is_empty() {
                        nodes[0].node.block_disconnected(&headers.pop().unwrap());
                }
+               {
+                       let events = nodes[0].node.get_and_clear_pending_events();
+                       assert_eq!(events.len(), 1);
+                       match events[0] {
+                               Event::BroadcastChannelUpdate { msg: msgs::ChannelUpdate { contents: msgs::UnsignedChannelUpdate { flags, .. }, .. } } => {
+                                       assert_eq!(flags & 0b10, 0b10);
+                               },
+                               _ => panic!("Unexpected event"),
+                       }
+               }
                let channel_state = nodes[0].node.channel_state.lock().unwrap();
                assert_eq!(channel_state.by_id.len(), 0);
                assert_eq!(channel_state.short_to_id.len(), 0);
        }
+
+       fn reconnect_nodes(node_a: &Node, node_b: &Node, pre_all_htlcs: bool, pending_htlc_claims: (usize, usize), pending_htlc_fails: (usize, usize)) {
+               let reestablish_1 = node_a.node.peer_connected(&node_b.node.get_our_node_id());
+               let reestablish_2 = node_b.node.peer_connected(&node_a.node.get_our_node_id());
+
+               let mut resp_1 = Vec::new();
+               for msg in reestablish_1 {
+                       resp_1.push(node_b.node.handle_channel_reestablish(&node_a.node.get_our_node_id(), &msg).unwrap());
+               }
+               {
+                       let mut added_monitors = node_b.chan_monitor.added_monitors.lock().unwrap();
+                       if pending_htlc_claims.0 != 0 || pending_htlc_fails.0 != 0 {
+                               assert_eq!(added_monitors.len(), 1);
+                       } else {
+                               assert!(added_monitors.is_empty());
+                       }
+                       added_monitors.clear();
+               }
+
+               let mut resp_2 = Vec::new();
+               for msg in reestablish_2 {
+                       resp_2.push(node_a.node.handle_channel_reestablish(&node_b.node.get_our_node_id(), &msg).unwrap());
+               }
+               {
+                       let mut added_monitors = node_a.chan_monitor.added_monitors.lock().unwrap();
+                       if pending_htlc_claims.1 != 0 || pending_htlc_fails.1 != 0 {
+                               assert_eq!(added_monitors.len(), 1);
+                       } else {
+                               assert!(added_monitors.is_empty());
+                       }
+                       added_monitors.clear();
+               }
+
+               // We dont yet support both needing updates, as that would require a different commitment dance:
+               assert!((pending_htlc_claims.0 == 0 && pending_htlc_fails.0 == 0) || (pending_htlc_claims.1 == 0 && pending_htlc_fails.1 == 0));
+
+               for chan_msgs in resp_1.drain(..) {
+                       if pre_all_htlcs {
+                               let _announcement_sigs_opt = node_a.node.handle_funding_locked(&node_b.node.get_our_node_id(), &chan_msgs.0.unwrap()).unwrap();
+                               //TODO: Test announcement_sigs re-sending when we've implemented it
+                       } else {
+                               assert!(chan_msgs.0.is_none());
+                       }
+                       assert!(chan_msgs.1.is_none());
+                       if pending_htlc_claims.0 != 0 || pending_htlc_fails.0 != 0 {
+                               let commitment_update = chan_msgs.2.unwrap();
+                               assert!(commitment_update.update_add_htlcs.is_empty()); // We can't relay while disconnected
+                               assert_eq!(commitment_update.update_fulfill_htlcs.len(), pending_htlc_claims.0);
+                               assert_eq!(commitment_update.update_fail_htlcs.len(), pending_htlc_fails.0);
+                               assert!(commitment_update.update_fail_malformed_htlcs.is_empty());
+                               for update_fulfill in commitment_update.update_fulfill_htlcs {
+                                       node_a.node.handle_update_fulfill_htlc(&node_b.node.get_our_node_id(), &update_fulfill).unwrap();
+                               }
+                               for update_fail in commitment_update.update_fail_htlcs {
+                                       node_a.node.handle_update_fail_htlc(&node_b.node.get_our_node_id(), &update_fail).unwrap();
+                               }
+
+                               commitment_signed_dance!(node_a, node_b, commitment_update.commitment_signed, false);
+                       } else {
+                               assert!(chan_msgs.2.is_none());
+                       }
+               }
+
+               for chan_msgs in resp_2.drain(..) {
+                       if pre_all_htlcs {
+                               let _announcement_sigs_opt = node_b.node.handle_funding_locked(&node_a.node.get_our_node_id(), &chan_msgs.0.unwrap()).unwrap();
+                               //TODO: Test announcement_sigs re-sending when we've implemented it
+                       } else {
+                               assert!(chan_msgs.0.is_none());
+                       }
+                       assert!(chan_msgs.1.is_none());
+                       if pending_htlc_claims.1 != 0 || pending_htlc_fails.1 != 0 {
+                               let commitment_update = chan_msgs.2.unwrap();
+                               assert!(commitment_update.update_add_htlcs.is_empty()); // We can't relay while disconnected
+                               assert_eq!(commitment_update.update_fulfill_htlcs.len(), pending_htlc_claims.0);
+                               assert_eq!(commitment_update.update_fail_htlcs.len(), pending_htlc_fails.0);
+                               assert!(commitment_update.update_fail_malformed_htlcs.is_empty());
+                               for update_fulfill in commitment_update.update_fulfill_htlcs {
+                                       node_b.node.handle_update_fulfill_htlc(&node_a.node.get_our_node_id(), &update_fulfill).unwrap();
+                               }
+                               for update_fail in commitment_update.update_fail_htlcs {
+                                       node_b.node.handle_update_fail_htlc(&node_a.node.get_our_node_id(), &update_fail).unwrap();
+                               }
+
+                               commitment_signed_dance!(node_b, node_a, commitment_update.commitment_signed, false);
+                       } else {
+                               assert!(chan_msgs.2.is_none());
+                       }
+               }
+       }
+
+       #[test]
+       fn test_simple_peer_disconnect() {
+               // Test that we can reconnect when there are no lost messages
+               let nodes = create_network(3);
+               create_announced_chan_between_nodes(&nodes, 0, 1);
+               create_announced_chan_between_nodes(&nodes, 1, 2);
+
+               nodes[0].node.peer_disconnected(&nodes[1].node.get_our_node_id(), false);
+               nodes[1].node.peer_disconnected(&nodes[0].node.get_our_node_id(), false);
+               reconnect_nodes(&nodes[0], &nodes[1], true, (0, 0), (0, 0));
+
+               let payment_preimage_1 = route_payment(&nodes[0], &vec!(&nodes[1], &nodes[2])[..], 1000000).0;
+               let payment_hash_2 = route_payment(&nodes[0], &vec!(&nodes[1], &nodes[2])[..], 1000000).1;
+               fail_payment(&nodes[0], &vec!(&nodes[1], &nodes[2]), payment_hash_2);
+               claim_payment(&nodes[0], &vec!(&nodes[1], &nodes[2]), payment_preimage_1);
+
+               nodes[0].node.peer_disconnected(&nodes[1].node.get_our_node_id(), false);
+               nodes[1].node.peer_disconnected(&nodes[0].node.get_our_node_id(), false);
+               reconnect_nodes(&nodes[0], &nodes[1], false, (0, 0), (0, 0));
+
+               let payment_preimage_3 = route_payment(&nodes[0], &vec!(&nodes[1], &nodes[2])[..], 1000000).0;
+               let payment_preimage_4 = route_payment(&nodes[0], &vec!(&nodes[1], &nodes[2])[..], 1000000).0;
+               let payment_hash_5 = route_payment(&nodes[0], &vec!(&nodes[1], &nodes[2])[..], 1000000).1;
+               let payment_hash_6 = route_payment(&nodes[0], &vec!(&nodes[1], &nodes[2])[..], 1000000).1;
+
+               nodes[0].node.peer_disconnected(&nodes[1].node.get_our_node_id(), false);
+               nodes[1].node.peer_disconnected(&nodes[0].node.get_our_node_id(), false);
+
+               claim_payment_along_route(&nodes[0], &vec!(&nodes[1], &nodes[2]), true, payment_preimage_3);
+               fail_payment_along_route(&nodes[0], &[&nodes[1], &nodes[2]], true, payment_hash_5);
+
+               reconnect_nodes(&nodes[0], &nodes[1], false, (1, 0), (1, 0));
+               {
+                       let events = nodes[0].node.get_and_clear_pending_events();
+                       assert_eq!(events.len(), 2);
+                       match events[0] {
+                               Event::PaymentSent { payment_preimage } => {
+                                       assert_eq!(payment_preimage, payment_preimage_3);
+                               },
+                               _ => panic!("Unexpected event"),
+                       }
+                       match events[1] {
+                               Event::PaymentFailed { payment_hash } => {
+                                       assert_eq!(payment_hash, payment_hash_5);
+                               },
+                               _ => panic!("Unexpected event"),
+                       }
+               }
+
+               claim_payment(&nodes[0], &vec!(&nodes[1], &nodes[2]), payment_preimage_4);
+               fail_payment(&nodes[0], &vec!(&nodes[1], &nodes[2]), payment_hash_6);
+       }
+
+       #[test]
+       fn test_invalid_channel_announcement() {
+               //Test BOLT 7 channel_announcement msg requirement for final node, gather data to build customed channel_announcement msgs
+               let secp_ctx = Secp256k1::new();
+               let nodes = create_network(2);
+
+               let chan_announcement = create_chan_between_nodes(&nodes[0], &nodes[1]);
+
+               let a_channel_lock = nodes[0].node.channel_state.lock().unwrap();
+               let b_channel_lock = nodes[1].node.channel_state.lock().unwrap();
+               let as_chan = a_channel_lock.by_id.get(&chan_announcement.3).unwrap();
+               let bs_chan = b_channel_lock.by_id.get(&chan_announcement.3).unwrap();
+
+               let _ = nodes[0].router.handle_htlc_fail_channel_update(&msgs::HTLCFailChannelUpdate::ChannelClosed { short_channel_id : as_chan.get_short_channel_id().unwrap() } );
+
+               let as_bitcoin_key = PublicKey::from_secret_key(&secp_ctx, &as_chan.get_local_keys().funding_key);
+               let bs_bitcoin_key = PublicKey::from_secret_key(&secp_ctx, &bs_chan.get_local_keys().funding_key);
+
+               let as_network_key = nodes[0].node.get_our_node_id();
+               let bs_network_key = nodes[1].node.get_our_node_id();
+
+               let were_node_one = as_bitcoin_key.serialize()[..] < bs_bitcoin_key.serialize()[..];
+
+               let mut chan_announcement;
+
+               macro_rules! dummy_unsigned_msg {
+                       () => {
+                               msgs::UnsignedChannelAnnouncement {
+                                       features: msgs::GlobalFeatures::new(),
+                                       chain_hash: genesis_block(Network::Testnet).header.bitcoin_hash(),
+                                       short_channel_id: as_chan.get_short_channel_id().unwrap(),
+                                       node_id_1: if were_node_one { as_network_key } else { bs_network_key },
+                                       node_id_2: if were_node_one { bs_network_key } else { as_network_key },
+                                       bitcoin_key_1: if were_node_one { as_bitcoin_key } else { bs_bitcoin_key },
+                                       bitcoin_key_2: if were_node_one { bs_bitcoin_key } else { as_bitcoin_key },
+                                       excess_data: Vec::new(),
+                               };
+                       }
+               }
+
+               macro_rules! sign_msg {
+                       ($unsigned_msg: expr) => {
+                               let msghash = Message::from_slice(&Sha256dHash::from_data(&$unsigned_msg.encode()[..])[..]).unwrap();
+                               let as_bitcoin_sig = secp_ctx.sign(&msghash, &as_chan.get_local_keys().funding_key);
+                               let bs_bitcoin_sig = secp_ctx.sign(&msghash, &bs_chan.get_local_keys().funding_key);
+                               let as_node_sig = secp_ctx.sign(&msghash, &nodes[0].node.our_network_key);
+                               let bs_node_sig = secp_ctx.sign(&msghash, &nodes[1].node.our_network_key);
+                               chan_announcement = msgs::ChannelAnnouncement {
+                                       node_signature_1 : if were_node_one { as_node_sig } else { bs_node_sig},
+                                       node_signature_2 : if were_node_one { bs_node_sig } else { as_node_sig},
+                                       bitcoin_signature_1: if were_node_one { as_bitcoin_sig } else { bs_bitcoin_sig },
+                                       bitcoin_signature_2 : if were_node_one { bs_bitcoin_sig } else { as_bitcoin_sig },
+                                       contents: $unsigned_msg
+                               }
+                       }
+               }
+
+               let unsigned_msg = dummy_unsigned_msg!();
+               sign_msg!(unsigned_msg);
+               assert_eq!(nodes[0].router.handle_channel_announcement(&chan_announcement).unwrap(), true);
+               let _ = nodes[0].router.handle_htlc_fail_channel_update(&msgs::HTLCFailChannelUpdate::ChannelClosed { short_channel_id : as_chan.get_short_channel_id().unwrap() } );
+
+               // Configured with Network::Testnet
+               let mut unsigned_msg = dummy_unsigned_msg!();
+               unsigned_msg.chain_hash = genesis_block(Network::Bitcoin).header.bitcoin_hash();
+               sign_msg!(unsigned_msg);
+               assert!(nodes[0].router.handle_channel_announcement(&chan_announcement).is_err());
+
+               let mut unsigned_msg = dummy_unsigned_msg!();
+               unsigned_msg.chain_hash = Sha256dHash::from_data(&[1,2,3,4,5,6,7,8,9]);
+               sign_msg!(unsigned_msg);
+               assert!(nodes[0].router.handle_channel_announcement(&chan_announcement).is_err());
+       }
 }