What Is Double Spending And How Does Cryptocurrency Like Bitcoin Prevent It?

Bitcoin is currently gaining popularity at an absolutely insane rate all over the world as both a form of digital currency and also as a payment method that is not only secure, but very private and dependable as well.

In order to fully understand exactly how bitcoin solves this double spending delima, we will need to first define what exactly the double spending problem is. To be perfectly honest, it’s actually a fairly easy idea to comprehend and this issue only arises on the word wide web and not in real world scenarios. This is because you cannot double spend with something like cash.

Definition states that double spending is, “a failure mode of digital cash schemes, when it is possible to spend a single digital token twice. Since, unlike physical token money such as coins, electronic files can be duplicated, and hence the act of spending a digital coin does not remove its data from the ownership of the original holder.”

So, precisely what does this all mean,  you may ask?

Let’s look at the following example. Let’s say you go to a local retailer to purchase a book. You have a ten dollar bill in your pocket and the book also costs exactly ten dollars (tax included). Once you pay for the book with your ten dollar bill, that money will now be in the drawer of the cash register at the store you bought it at. That exact ten dollar bill can only be in one place at one time. This means that is without a doubt cannot be in your wallet AND the store register at the same time!

When it comes to monetary transactions taking place online however, things can happen a bit differently.

Both sales and purchases made online these days are almost entirely done using a combination of computer coding and also algorithms. All this means means, is the same money cannot be in two or more different places at the same exact time. In order to prevent this exact scenario from happening, there are actually very advanced payment gateways and processors such as PayPal, Worldpay, Authorize.net and many other similar companies and services to make sure that this double spending does not, indeed occur.

These payment processors have very advanced systems in place that review all the transactions carefully in order to catch and prevent any and all mistakes from occurring. But also to help prevent fraud as well which is and always will be a threat when dealing with transactions such as this.

Now, in spite of these processors being first rate and highly consistent and reliable, there are also a couple disadvantages as well. If, for instance, there are any technical issues, or the platform flags your transaction as sketchy or shady, your transactions will be denied. This safeguard is what is known as a single point of failure system.

In addition to that, you may also find that your account will be suspended pending review. This means that your funds will also be stuck until your account is cleared and passed the review.


Over the past few years recently, there have been a shocking amount of people have reported having their PayPal accounts suspended or completely shut down for absolutely no good reason at all. In addition to this, in order to maintain their services, said platforms will charge fees ranging from 2%-5%  and even higher! Depending on your volume of transactions, these can really add up quickly and be quite the exorbitant tax on your transactions.

Bitcoin and most other kinds of alt-coins and cryptocurrency make this double spending issue a lot less problematic because the blockchain simply does not rely on a single point of failure like what these other processors and platforms do. The bitcoin payment system uses the blockchain to prevent double spending from occurring and it does so without incurring nearly as high of fees as other competitors.

Now, I don’t want to get too technical here, but a blockchain is in actuality, a shared database by all the nodes participating in that specific coin system. In this case Bitcoin. There is a record on said database of all the transactions that took place using the coin.

Every block in the blockchain has the hash from the previous block as well. Now, it is important to realize that the blocks are in chronological order and that one cannot simply change one block without changing anything else. If you were to do that, it would mean you would have to change every other block down the line chronologically as well. This process is what makes double spending with Bitcoin borderline impossible. Why, you may ask? This is because every single transaction  on the blockchain depends on the one before it and the one before that and so on and so forth. The Bitcoin’s movement from wallet to wallet can be traced all the way back to the first block.

Believe me when I tell you that there is so much more to explain when it comes to the block chain. However, the point for now is that cryptocurrencies like Bitcoin prevent double spending when making online purchases without incurring massive fees or even having your funds locked up. In my opinion, this is one of the best features of using cryptocurrencies for your online purchases! No more hassles as far as your funds are concerned. This should be a point in the plus column in anyone’s book!

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