Locktime (nLocktime) can be set to a specific block height or Unix timestamp. If the network’s block height or median time is below that threshold, nodes refuse to confirm the transaction. This feature allows delayed spending of UTXOs—useful for escrow arrangements or time-based contracts (e.g., CLTV). Many wallets default to a locktime of 0, meaning it’s immediately valid. When combined with partial signatures and advanced scripting, locktime can implement scheduled payouts, payment channels, or other contract-like mechanisms in Bitcoin’s limited script environment.