How does nSequence/Check Sequence Verify work?

In order to use a relative time lock, you need to provide the requirements in the scriptPubKey to which the Bitcoin is sent.

Example

scriptPubKey for escrow with 30 day timeout:

IF
    2 <Alice's pubkey> <Bob's pubkey> <Escrow's pubkey> 3 CHECKMULTISIG
ELSE
    "30d" CHECKSEQUENCEVERIFY DROP
    <Alice's pubkey> CHECKSIG
ENDIF

Then, in order to spend it before 30 days, the scriptSig that satisfies the first conditional statement (multisig script) must be provided, i.e.:

scriptSig: 0 <signature1> <signature2>

Or after 30 days, alice can provide:

scriptSig: <signature>

See BIP112

Sequence

Note that in order to set a relative locktime: the tx must have the following properties:

version must be 2 or greater
nSequence must not have 32nd bit set
nSequence must have the 23rd bit set (0x400000) if it is a lock-time type, unset for block height type
for relative lock-time type the granularity of each bit is 512 seconds
for relative block height type each bit represents 1 block

For 30 days, I believe it would be as follows:

30 * 24 * 60 * 60 = 2592000 seconds
2592000 / 512 = 5062.5 ~= 5063 or 0x13C7
sequence = 0x13C7 | 0x400000 = 0x4013C7 or 4199367
nSequence = 0xC7134000 (little endian)

The sequence is the very last 4 bytes of the transaction, see https://en.bitcoin.it/wiki/Transaction

JBaczuk

Posted 2019-01-14T19:47:52.823

Reputation: 6 172

Thank you, very clear. Do u know where to add nSequence parameter inside a transaction? – Bruce Wayne – 2019-01-15T08:50:52.063

The sequence or locktime is the very last 4 bytes of the transaction, see https://en.bitcoin.it/wiki/Transaction

– JBaczuk – 2019-01-15T12:54:24.833

@JBaczuk - Has the impact of little endian encoding been taken into consideration after performing BIP 68 bit encoding? – skaht – 2019-01-15T19:24:38.713

@skaht right, you'd need to convert to little endian before putting it in the transaction – JBaczuk – 2019-01-15T21:19:34.627

1The nSequence field is not the same as the nLockTime field. The nSequence field is per-input, and inputs can have different values set. See General format (inside a block) of each input of a transaction - Txin in the bitcoin wiki link. – arubi – 2019-01-16T08:54:47.127

Right, thanks I was mixing the two terms, I'll try to clarify – JBaczuk – 2019-01-16T13:03:26.013

nSequence is at the TX input level. Was referring to each TX output CSV opcode locktime needing to be BIP 68 encoded and converted to little endian format. nLockTime is associated with absolute time locks. – skaht – 2019-01-17T03:57:41.617

TX version number must be set to 2 or greater per https://github.com/bitcoin/bips/blob/master/bip-0112.mediawiki#summary.

– skaht – 2019-01-17T15:53:59.780