Timelock
A timelock is a rule written into a transaction or address that keeps the coins unspendable until a set time or block height.
What Is a Timelock?
A timelock makes coins spendable only after a condition in time is met. Bitcoin has absolute timelocks (until a given block height or date, via nLockTime and OP_CHECKLOCKTIMEVERIFY) and relative ones (a number of blocks after the coins were received, via OP_CHECKSEQUENCEVERIFY).
They are what makes several self-custody designs work: the Lightning Network uses them to settle disputes, and wallets built on Miniscript use them for recovery paths, such as a backup key or an heir's key that becomes valid only if the main key has not moved the coins for a year.
A timelock is enforced by the network, not by any company, so it keeps working if the wallet vendor disappears. The coins must still be moved in time to reset a relative timelock, otherwise the recovery path opens.
Bitcoin (BTC) is the first decentralized cryptocurrency, launched in 2009. It uses blockchain technology for secure, peer-to-peer digital transactions without intermediaries.
Read full definitionBlock height refers to the number of blocks in a blockchain, starting from the first block (genesis block). It is also known as the block number and indicates the position of a block in the chain.
Read full definitionOptimism is an Ethereum Layer 2 optimistic rollup network. It batches transactions off-chain for faster, cheaper processing while inheriting Ethereum's security.
Read full definitionSelf-custody means users control their own private keys to manage cryptocurrency assets directly, without third-party custodians. It embodies 'not your keys, not your coins.'
Read full definitionThe Lightning Network is a Layer 2 solution for Bitcoin that enables faster, cheaper transactions by creating off-chain payment channels between users.
Read full definitionMiniscript is a structured policy language for Bitcoin Script. It simplifies writing, analyzing, and compiling complex spending conditions.
Read full definitionRecovery is the process of restoring access to a cryptocurrency wallet using its seed phrase or mnemonic backup if the original wallet is lost or inaccessible.
Read full definitionA backup in cryptocurrency is a secure copy of a wallet's seed phrase or private keys. It enables recovery of funds if the original wallet is lost or damaged.
Read full definitionReal-World Examples
Example 1: A wallet's policy lets the owner spend at any time, and lets a backup key spend only after 52,560 blocks (about a year) of inactivity.
Example 2: A Lightning channel closed unilaterally keeps the closing party's funds locked for a set number of blocks, giving the other side time to contest an old state.
A backup in cryptocurrency is a secure copy of a wallet's seed phrase or private keys. It enables recovery of funds if the original wallet is lost or damaged.
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