This is the third article in a series deep diving into individual covenant proposals that have reached a point of maturity meriting an in-depth breakdown.

TXHASH and CHECKTXHASHVERIFY (TXHASH), put forward by Steven Roose and Brandon Black with a BIP number currently unassigned, is a “template based” covenant that can conceptually seen as an extension or more advanced version of CHECKTEMPLATEVERIFY (CTV). 

Before getting into the nitty gritty of how TXHASH works, let’s refresh on the pieces of data in a Bitcoin transaction. 

At a high level you have the outputs, the inputs, and the witness (or script sig for non-Segwit transactions in the input). 

Global transaction fields:

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