Can someone explein me this Multi mint function (Solidity)?

Question

I came accross this function to mint token for a crowdsale but I don't understand the meaning of the bit shift operations and what bit array should represent.. what is this code doing ? The code can be found here: https://github.com/bokkypoobah/ZeroSumCrowdsaleContractAudit/blob/9fe4765a0a0394a476a618608a4914754651ce59/contracts/Ledger.sol#L290

The function is this one:

function multiMint(uint nonce, uint256[] bits) onlyOwner {
    require(!mintingStopped);
    if (nonce != mintingNonce) return;
    mintingNonce += 1;
    uint256 lomask = (1 << 96) - 1;
    uint created = 0;
    for (uint i=0; i<bits.length; i++) {
        address a = address(bits[i]>>96);
        uint value = bits[i]&lomask;
        balanceOf[a] = balanceOf[a] + value;
        controller.ledgerTransfer(0, a, value);
        created += value;
    }
    totalSupply += created;
}

Answer 1

The author is trying to save resources (mostly the gas used to transmit the data to the contract within the transaction) by packing both the address and the value within a single 256-bit word. Normally they would each occupy separate 256 bit words, so this technique saves about half the space/gas.

In hex (64 chars for 32 bytes, 256 bits) the packed uint256 input bits[i] looks like this:

0123456789ABCDEF0123456789ABCDEF0123456789ABCDEF0123456789ABCDEF
<----- Ethereum address, 160 bits -----><--- Value, 96 bits --->

Two operations then extract the address a and the uint value:

address(bits[i]>>96) gets you the address by right shifting everything (zeros are inserted on the left):

0123456789ABCDEF0123456789ABCDEF0123456789ABCDEF0123456789ABCDEF
                        <----- Ethereum address, 160 bits ----->

bits[i]&lomask gets you the value, since lomask is 96x1 bits, so the higher address bits are masked out by the & operation:

0123456789ABCDEF0123456789ABCDEF0123456789ABCDEF0123456789ABCDEF
<----- Ethereum address, 160 bits -----><--- Value, 96 bits --->
<---   lomask 0 bits                ---><--- lomask 1 bits  --->

This doesn't conform to the Ethereum ABI, but that's not a big deal if the gains are worth it.