[bug]: Failed recover on-chain testnet funds with neutrino

Background

I was testing lnd recovery by attempting to recover a recently created testnet wallet with a non-zero balance. I followed the on-chain recovery instructions. After executing the recovery process, the recovery status showed as complete:

lncli getrecoveryinfo
{
    "recovery_mode": true,
    "recovery_finished": true,
    "progress": 1
}

However, the recovered wallet balance was zero.

Additionally, when generating a new address with lncli newaddress p2wkh, it produced the same address as before the restore. In my case, the address tb1qaa898gjprr5uh002kyqtnmpj02ur4vvw4v3ujh still has a balance, as confirmed by the testnet explorer here.

I also tried rebooting lnd and unlocking with a doubled recovery window, as well as launching lnd with the --reset-wallet-transactions flag. None of these steps resolved the issue. Please see the provided logs and screenshots for more details.

Logs contain a lot of such error messages:

[ERR] LNWL: Unable to synchronize wallet to chain, trying again in 5s: unable to perform wallet recovery: failed to store sync information 00000000f2ba832b40294ba33f8f005221af639aa3458d3fbc1b8da0a6a58105: failed to fetch block hash for height 2902302: block not found

fail_to_recover fail_to_recover_by_unlock logs.zip

Environment

lnd version: v0.18.2-beta
Docker on Apple Silicon
Testnet with Neutrino backend

version: '3'

services:
    lnd:
      image: lightninglabs/lnd:v0.18.2-beta
      container_name: lnd-testnet
      environment:
        LNCLI_NETWORK: testnet
      volumes:
        - ./testnet-data:/root/.lnd
      command: >
        --bitcoin.active
        --bitcoin.testnet
        --bitcoin.node=neutrino
        --feeurl https://pastacity.nl/VjtaVK73NZwGBAisrA3iFg
        --debuglevel=debug

Steps to reproduce

Start the lnd service. Follow the on-chain recovery instructions. Use lncli to create a seed and passphrase from an existing, recently created lnd wallet with a non-zero on-chain balance. Set the recovery window to the default value. Wait until lncli getrecoveryinfo shows recovery_finished = true. Check the wallet balance with lncli walletbalance.

Expected behaviour

The wallet should show the restored on-chain balance after recovery.

Actual behaviour

The recovered wallet balance is zero:

{
    "total_balance":  "0",
    "confirmed_balance":  "0",
    "unconfirmed_balance":  "0",
    "locked_balance":  "0",
    "reserved_balance_anchor_chan":  "0",
    "account_balance":  {
        "default":  {
            "confirmed_balance":  "0",
            "unconfirmed_balance":  "0"
        }
    }
}

lightningnetwork / lnd