How Bitcoin Timestamping Works

Bitcoin timestamping leverages the immutable nature of the Bitcoin blockchain to create permanent, verifiable proof that a document existed at a specific point in time. Here’s how the entire process works from upload to verification.

The Cryptographic Foundation

SHA-256 Hashing

Every digital document has a unique cryptographic fingerprint called a hash:

Document: "Hello World"
SHA-256:  a591a6d40bf420404a011733cfb7b190d62c65bf0bcda32b57b277d9ad9f146e

Key properties of SHA-256:

• Deterministic: Same input always produces same hash
• Avalanche effect: Tiny changes create completely different hashes
• One-way function: Impossible to reverse engineer the original document
• Collision resistant: Extremely unlikely for two different documents to have the same hash

Hash as Proof-of-Existence

By timestamping the hash instead of the document itself:

• Privacy preserved: Original content remains secret
• Integrity guaranteed: Any modification invalidates the proof
• Efficiency achieved: 64 characters represent files of any size

Step-by-Step Process

1. Client-Side Document Processing

// Simplified version of our hashing process
async function computeHash(file) {
  const arrayBuffer = await file.arrayBuffer();
  const hashBuffer = await crypto.subtle.digest('SHA-256', arrayBuffer);
  const hashArray = Array.from(new Uint8Array(hashBuffer));
  return hashArray.map(b => b.toString(16).padStart(2, '0')).join('');
}

What happens:

• File loaded into browser memory as ArrayBuffer
• Web Crypto API computes SHA-256 hash
• Result converted to hexadecimal string
• Original file immediately discarded from memory

Security benefits:

• No network transmission of sensitive content
• No server-side file processing required
• User maintains complete control over original document

2. Payment and Metadata Storage

When payment is processed, the following metadata is stored with Stripe:

{
  "hash": "a591a6d40bf420404a011733cfb7b190d62c65bf0bcda32b57b277d9ad9f146e",
  "filename": "important-contract.pdf",
  "size": "245760",
  "productId": "document-timestamp",
  "timestamp": "2025-01-29T10:30:45.123Z"
}

Metadata significance:

• hash: The cryptographic fingerprint to be timestamped
• filename: Human-readable identifier (encrypted in Stripe)
• timestamp: When the payment was processed
• service: Type of timestamping service requested

3. Bitcoin Blockchain Anchoring

After successful payment, the hash enters our timestamping queue:

Batch Processing

• Multiple hashes are collected over a time period (typically 1-6 hours)
• Hashes are combined using a Merkle tree structure
• Only the Merkle root is embedded in the Bitcoin transaction

Merkle Tree Construction

        Root Hash
       /         \
   Hash AB     Hash CD
   /    \      /    \
Hash A Hash B Hash C Hash D

Benefits of batching:

• Cost efficiency: One Bitcoin transaction serves multiple customers
• Privacy: Individual hashes not directly visible on blockchain
• Scalability: Thousands of documents per transaction

Bitcoin Transaction

The Merkle root is embedded in a Bitcoin transaction using one of these methods:

• OP_RETURN output: Direct data embedding (80 bytes max)
• Pay-to-Witness-Script-Hash: Embedding in script witness data
• Taproot: Data in Taproot script tree

4. Confirmation and Finality

Once the Bitcoin transaction is mined:

• First confirmation: Hash is permanently recorded (10-60 minutes)
• Six confirmations: Timestamp considered final (60-360 minutes)
• Immutable proof: Cannot be altered without rewriting entire blockchain

Verification Process

Independent Verification

Anyone can verify a timestamp proof without trusting Eternity Bits:

1. Compute document hash using any SHA-256 tool
2. Locate Bitcoin transaction containing the Merkle root
3. Verify Merkle path from document hash to root
4. Check transaction timestamp in Bitcoin block header

Verification Tools

# Command line verification example
sha256sum document.pdf
# Output: a591a6d40bf420404a011733cfb7b190d62c65bf0bcda32b57b277d9ad9f146e

# Look up transaction on blockchain explorer
bitcoin-cli getrawtransaction [txid] 1

Long-term Accessibility

Proofs remain verifiable indefinitely because:

• Bitcoin blockchain is permanent: Cannot be deleted or modified
• Verification is mathematical: Doesn’t require Eternity Bits to exist
• Open standards: SHA-256 and Bitcoin are public protocols

Security Guarantees

Cryptographic Security

• SHA-256 strength: 2^256 possible hashes (more than atoms in universe)
• Bitcoin network security: Protected by massive computational power
• Mathematical certainty: Based on provable cryptographic properties

Timestamp Accuracy

• Block timestamp bounds: Bitcoin blocks have strict timing rules
• Network consensus: Thousands of nodes agree on timing
• Median time past: Prevents timestamp manipulation

Immutability Assurance

• Proof-of-Work protection: Massive energy cost to alter history
• Network effect: Global consensus makes changes practically impossible
• Economic incentives: Miners have strong incentive to maintain integrity

Technical Limitations

Blockchain Constraints

• Transaction fees: Bitcoin network fees affect timestamping cost
• Block timing: Average 10-minute confirmation time
• Data size limits: Only hashes can be timestamped, not full documents

Verification Requirements

• Technical knowledge: Full verification requires understanding of cryptography
• Blockchain access: Need Bitcoin node or trusted blockchain explorer
• Tool availability: Requires SHA-256 and Merkle tree verification tools

Comparison with Traditional Timestamping

Trusted Timestamp Authorities (TSA)

Traditional approach:

• Centralized authority signs timestamps
• Requires ongoing trust in TSA
• Subject to political and legal pressure
• Can be compromised or cease operation

Bitcoin approach:

• Decentralized global consensus
• Mathematical proof, no trust required
• Censorship resistant
• Permanent operation guaranteed by economic incentives

Digital Signatures

Digital signatures prove:

• Identity of signer
• Integrity of signed document
• Non-repudiation of signature

Bitcoin timestamps prove:

• Document existed at specific time
• Document contents (via hash)
• No identity or authorization claims

Bitcoin timestamping complements rather than replaces digital signatures, providing an additional layer of cryptographic evidence for critical documents.

Future Enhancements

Planned Improvements

• Lightning Network integration: Faster, cheaper micro-timestamps
• Batch optimization: More efficient Merkle tree structures
• Enhanced privacy: Zero-knowledge proofs for sensitive documents
• Cross-chain compatibility: Timestamps across multiple blockchains

The foundation of Bitcoin timestamping is solid and proven, with ongoing innovations making it even more powerful and accessible for everyday use.