Transactions are not checked for nLocktime and inputs are not checked for nSequence

[sirdeggen]

arc/validator/default/default_validator.go

Line 158 in 2643ccb

/* lots of our valid test transactions have this sequence number, is this not allowed?

This should check to ensure inputs are all final only if the nLocktime is being enforced. The TODO suggests that this check was raising issues during development.

I think that it should be fine to invert this. Only pass if nSequence are all final. Otherwise we have to check nLocktime, but we don't know the height we're at in terms of block without checking blockTx which complicates things.

I would suggest we add status context rather than erroring out. If the nSequence numbers are lower than max - just noting that it might be the case that this transaction does not get mined until the nLocktime value passes.

Discussion:

[sirdeggen]

Ongoing discussion within BSVA regarding how Teranode will handle locktime and sequence. This will inform the direction of this issue.

[eye1]

An SPV wallet can independently verify transaction finality prior to broadcasting to ARC. Alternatively, simpler wallet implementations can delegate this verification to ARC, significantly reducing wallet complexity by abstracting the necessary checks.

This behavior should ideally be controlled by a configurable flag, allowing wallets the flexibility to broadcast non-final transactions if needed.

An important consideration is whether chains of unconfirmed, non-final transactions can be constructed. Allowing such chains might introduce potential vulnerabilities, particularly for wallets or services that rely on instant (zero-confirmation) deposits, by creating new vectors for double-spend attacks or similar exploits. Thorough examination of this scenario is advisable.