What if a person is in the Bitcoin network, and he received payment in Bitcoin but after 3 hours the coins which he received from the buyer has vanished out of nowhere, is it a victim of double spending?
One of the major concerns with digital currency or Cryptocurrency is that it can be spent twice. Double-spending is unique and a disturbing problem that only occurs when digital information can be reproduced easily. This is a major difference between Cryptocurrency and Fiat Currency. When you’re dealing with Fiat currency or physical currency then you’re very well aware of the fact that the fiat currency cannot be easily replicated and the people involved in the exchange and transaction based on Fiat Currency can immediately verify the bona fides of the Fiat Currency.
When it comes to Cryptocurrency, there will always be a reminder, more of a risk that the holder could make a copy of the digital token and can send it to a merchant or any other party while retaining the original tokens. People are and have been quite a bit familiar about double spending, but for those who are not aware should know that Bitcoin, world’s first and foremost Cryptocurrency had this major flaw in its network. The reason why double spending on Bitcoin was a big thing is that Bitcoin is decentralized, meaning no central agency has the access to verify that the Cryptocurrency is spent only once. Yet, Bitcoin includes a mechanism on its network which is based on transaction logs in order to verify the authenticity of each transaction to prevent double-spending.