Understanding GreenAddress nLocktime/recovery transactions What I understand is that Greenaddress locks a recovery transaction to be spend 90 days in the future. Whats the advantage in doing this?
Why not creating a recovery transaction without nLocktime?
When using a multisig Green Address wallet your funds are locked in a 2-of-2 multisig account, i.e. if you want to spend money from that account you need both your signature and Green Address' signature. This is done so that Green Address can guarantee that you will not try to double spend money from that account. This allows Green Address to grant you instant confirmation transactions. However, this means that in case Green Address goes down, or stops functioning in any way, your funds are locked in the multisig account for good. To mitigate this problem, Green Address generates and signs a transaction that unlocks your funds after 90 days. This means that, in case Green Address disappears, after 90 days you can broadcast that transaction and get your funds back. The reason why nLocktime is used is that if Green Address gave you a transaction without nLocktime, you would be able to spend the money in the multisig account at any time. This would not allow Green Address to guarantee that you do not try to double spend your funds when performing a transaction from that account, hence making Green Address not able to allow you instant confirmation transactions. In this way, instead, Green Address can guarantee that you will not double spend from that account for the next 90 days, hence granting you instant confirmation transactions.