Double Spend

Double-spend is a flaw with digital currencies that occurs when someone tries to use the same money for two different transactions at the same time.

In other words, how can you be sure that digital money sent to you was not simultaneously sent to someone else?

An example of this is trying to send the same bitcoin (BTC) to different wallet addresses at the same time before either of the transactions has a chance to be confirmed to the network.

A double-spend can happen by accident or it can happen deliberately, whereby someone tries to trick the network.

Since digital data like text and photos are easy to duplicate, this is a problem if you’re trying to use digital money.

Double-spending was one of the original problems that digital currencies needed to solve.

This isn’t a problem with paper money or gold, as you have to physically give up possession of either when making a payment.

Before Bitcoin, payments made digitally had to rely on a central authority, like a bank or credit card company, to keep track of transactions and account balances but, of course, his process wasn’t decentralized.

Blockchain technology solves the double spend problem.

Bitcoin is the most famous example of blockchain technology, using a proof-of-work (PoW) consensus protocol to verify transactions contained in a block, in order to add that block to the blockchain.

Related Terms

Bitcoin (BTC)

Bitcoin (BTC) is most well known as a digital decentralized cryptocurrency, without a central bank or single administrator, that can be sent from user to user on the peer-to-peer Bitcoin network without the need for intermediaries, such as payment gateways or banks or routing services. Think of bitcoin as Internet money, that you can send and receive directly, to and from anyone, and you can use it to pay for stuff.

Genesis Block

The very first block or first few blocks recorded on a blockchain or blockchain-based protocol. The genesis block is often called Block 0 or Block 1. The genesis block sets the foundation for the rest of the blocks that are added to form a chain of blocks. That’s where we get the word “blockchain”. The most famous genesis block, and the very first Bitcoin block, called the Genesis Block, was created on January 3rd, 2009, by Bitcoin’s infamous and mysterious creator, Satoshi Nakamoto. Some consider this date to be the start of the cryptocurrency revolution – the start of it all!

Immutability

A core feature of blockchains that makes their ledgers, the data record of transactions, unchangeable and unalterable. Immutability drives the trustworthiness and integrity of blockchain data as chain transactions and rulesets are protected from fraud, hacking and other wrongdoing.

Blockchain

Blockchain networks are at the heart of cryptocurrencies. A blockchain is a database, or digital ledger, made up of a series of interconnected blocks containing transaction data created on the network over some period of time. Each block in a blockchain also contains a unique identifier unlike any other block in the chain called a hash. Think of the hash as a fingerprint identifying that block for all other blocks. Distributed ledger technology (DLT) is another name frequently used in relation to blockchains.

Digital Currency

Digital Currency, also called digital cash, digital money, or virtual currency is any form of currency or money-like asset that’s only available in purely digital or electronic form.