How do I write a script such that my funds are locked in a 2-of-2 multisig that converts into a 1-of-2 multisig after 365 days?

Question

I would like my Bitcoin to have the extra security that a 2-of-2 multisig provides. With a single sig I am worried that if a single key gets hacked I will lose my funds. However, with a 2-of-2 multisig I am worried that if I lose either key my funds will be trapped.

How do I write a script such that my funds are locked in a 2-of-2 multisig which converts into a 1-of-2 multisig after 365 days? This way I get the best of both worlds. I have greater security for 365 days and then if I lose one of my keys I can still access my funds after 365 days.

Answer 1

To construct the script you could use Pieter Wuille's Miniscript site.

If you go to the Policy to Miniscript compiler section there is an example in Policy for a 2-of-2 multisig that turns into a 1-of-2 multisig after 90 days.

and(pk(key_user),or(99@pk(key_service),older(12960)))

You would need to adjust it for your desired example. A Policy that fits your needs would be:

and(pk(key_1),or(99@pk(key_2),older(52560)))

Once you have the Policy you can copy and paste this into the Policy to Miniscript compiler section and get the Miniscript equivalent of this Policy. The Miniscript output is:

and_v(v:pk(key_1),or_d(pk(key_2),older(52560)))

Further down you can copy and paste this Miniscript in, press Analyze and you will get the size of the resulting Script (78 bytes) as well as the actual Script:

<key_1> OP_CHECKSIGVERIFY <key_2> OP_CHECKSIG OP_IFDUP OP_NOTIF
    <50cd00> OP_CHECKSEQUENCEVERIFY
OP_ENDIF

It is worth noting that this example assumes you are more concerned with losing one particular key (key_2 in this example) and you assume will still have access to key 1. If you are just as likely to lose either key (key_1 or key_2) you would want a different script.

I recommend you try this on testnet or Signet first where coins aren't worth anything. Alternatively with a small amount of funds on mainnet that you can afford to lose. You don't want to be losing all your funds due to a mistake or a misunderstanding.