Point Time Locked Contract (PTLC)

A point time locked contract, or PTLC, is a conditional bitcoin payment that locks funds to a point on the secp256k1 elliptic curve rather than to a hash, releasing them when the corresponding secret number is revealed. PTLCs are the proposed successor to the hash time locked contracts that route payments across the Lightning Network today.

Why it matters

Every hop in a current Lightning route shares the same payment hash, so any two colluding nodes along a path can tell they are handling the same payment. PTLCs remove that correlation: each hop can use a different curve point, blinded by random tweaks, so intermediaries learn nothing that links them to each other. PTLCs also provide cleaner proof of payment and support more expressive contract designs.

How it works

A PTLC relies on adaptor signatures, a technique made practical by the Schnorr signatures activated in the Taproot upgrade of November 2021. The receiver commits to a secret scalar, the sender locks funds to the matching public point, and completing the signature necessarily reveals the secret, which then unlocks each preceding hop in the route. Timelocks return the funds to the sender if the payment fails partway.

Because deployment requires coordinated changes to the Lightning protocol across implementations, PTLCs have remained in research and development rather than production use for several years after Taproot activation.