Glossary

Point Time Locked Contract (PTLC)

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A Point Time Locked Contract (PTLC) is a Bitcoin transaction which locks bitcoin to a point on Bitcoin’s elliptic curve. The outputs created by this transaction type are also time locked, meaning they cannot be spent before a certain time, as denominated in UTC time or block height. PTLCs are similar to Hashed Time Locked Contracts (HTLCs), but offer privacy gains as well as fee savings. For this reason, PTLCs may replace HTLCs as the driving contract behind the Lightning Network and other off-chain protocols.

Point Time Locked Contracts will become most accessible after Schnorr signatures have been implemented on Bitcoin, which will occur when the Taproot upgrade is activated.

Related Terms
Schnorr Signature
Schnorr is a type of digital signature scheme similar to the ECDSA scheme. The Schnorr scheme presents several security, privacy, and efficiency advantages over ECDSA.
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Hashed Time Locked Contract (HTLC)
A Hashed Time Locked Contract is a timelocked Bitcoin transaction used on the Lightning Network to route payments between parties who do not share a Lightning Channel.
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Lightning Network
The Lightning Network (LN) is a protocol designed to allow instant and cheap Bitcoin transactions. While it is still experimental, it shows great promise for Bitcoin’s ability to scale.
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Secp256k1
Secp256k1 is the name of the elliptic curve used by Bitcoin to implement its public key cryptography. All points on this curve are valid Bitcoin public keys.
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Bitcoin Script
Script is the language Bitcoin uses to determine who can spend a given piece of bitcoin (a UTXO). Script is intentionally limited in order to maintain Bitcoin's simplicity and ensure that any individual can run a node and validate the blockchain.
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