With Script, users are able to create different criteria on how their BTC is utilized.
For instance, a time-locked script can dictate that three signatures are needed in order to spend a given amount of bitcoin before a specific period, after which only one signature will be needed.
Unlike P2PKH scripts that require one signature, a multi-signature or multisig script can require several signatures belonging to several users.
That means that the amount of bitcoin locked to this type of script cannot be spent unless M signatures are issued and each of them needs to match one of the N public keys conditions.
The two scripts work together to make it possible for bitcoin to be sent to the hash of any script.
The most notable layers for smart contracts built on top of Bitcoin include Rootstock, Liquid, Stacks, Lightning, and RBG.
The Turing-complete smart contracts provided by RSK is a concept that was first proposed by computer scientist Nick Szabo back in 1993.
The Liquid Network was launched in 2018 by major blockchain technology company Blockstream.
As a Bitcoin smart contract layer, it gives users the ability to provide assets in the form of tokens such as stablecoins.
Stacks is a Layer 1 blockchain that is connected to Bitcoin by its consensus mechanism known as proof-of-transfer .
As a smart contract system, RGB makes use of the blockchain as a state commitment layer and Bitcoin script as an ownership control system.