Hashed Timelock Contract(HTLC)
A smart contract that locks funds with two conditions: a cryptographic hash preimage and a time deadline.
In-Depth Explanation
HTLCs enable conditional payments: reveal the secret before the deadline to claim funds, or the sender can reclaim after timeout. This mechanism powers atomic swaps and payment channels like Lightning Network. The hash ensures atomicity—revealing the secret on one chain lets the counterparty claim on the other.
Related Terms
Atomic Swap
A trustless exchange of cryptocurrencies between different blockchains without requiring an intermediary.
Lightning Network
A Layer 2 payment network built on Bitcoin that enables fast, low-cost transactions through payment channels.
Smart Contract
Self-executing code deployed on a blockchain that automatically enforces agreement terms when conditions are met.
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