Double spending

Double spending is the risk that the same digital money is spent twice. Digital files can be copied endlessly, so any digital cash system needs a way to stop someone paying two people with the same coins. Banks solve this with a central ledger; Bitcoin was the first system to solve it without a trusted middleman.

On Bitcoin, every node checks that the coins in a new transaction have not already been spent, and proof of work makes it extremely costly to rewrite history once a transaction is buried under several blocks. That is why merchants and exchanges wait for confirmations.

A double spend is still possible in some cases: an unconfirmed transaction can be replaced by one with a higher fee that sends the coins elsewhere, and a miner or group controlling a majority of a network's hash rate could reorganise recent blocks. Smaller networks with little hash rate have suffered real double-spend attacks this way.