Quote from: topynate on January 10, 2015, 10:54:54 PM

Transactions don't get replaced in the client based on sequence number ~~any more~~. More recently, the handling of nLockTime was also changed, so that transactions with an nLockTime in the future can't enter the memory pool. There's some history at the wiki.

I posted an idea for payment channels to the bitcoin-development list yesterday, provoking a discussion of this very topic.

Besides the discussion about what Bitcoin's behavior should be, I'm also interested in what the exact behavior of Bitcoin is, right now.

The way I understand it, the current behavior of non-modified Bitcoin Core is (assuming all else is correct about a transaction):

any sequence number is 0xffffffff -> see "transaction OK"
all sequence numbers are not 0xffffffff and nLockTime is expired -> see "transaction OK"
all sequence numbers are not 0xffffffff and nLockTime is not expired -> see "transaction NOT OK"
"transaction OK" -> transaction will be transferred to other nodes and included into blocks. Will mine on top of blocks that include such transactions.
"transaction NOT OK" -> transaction will NOT be transferred to other nodes and NOT included into blocks. Will NOT mine on top of blocks that include such transactions.

Is this correct?