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Hashed TimeLock Contract (HTLC)

Hashed TimeLock Contract (HTLC)

Last Updated: January 23, 2026

Hashed TimeLock Contract (HTLC) is a smart contract ensuring conditional transactions with a hashlock and a timelock mechanism.

Hashed TimeLock Contract (HTLC) is a method used in blockchain to facilitate conditional payments. It uses a hashlock to secure the transaction with a cryptographic hash. The recipient must provide a preimage to unlock the funds. Additionally, it incorporates a timelock, ensuring the transaction is completed within a specified timeframe. If the conditions are unmet, the funds are returned to the sender. HTLCs are crucial for atomic swaps and payment channels like the Lightning Network. They enhance security by reducing counterparty risk and ensuring trustless transactions in both crypto and fiat exchanges.