Understanding Blockchain - Part 4
Hello everyone, hope you all are doing good? I'm back with the Part 4 of this amazing series, Understaning Blockchain. If you haven't read the Part 1, Part 2 and Part 3, I strongly suggest you that by clicking here for Part 1, here for Part 2 and here for Part 3. In today's article we would be looking at what is Blockchain Double Spending and how Bitcoin handles this problem?.
Blockchain double spending occurs when a user manipulates the blockchain system to his/her favor, hereby making two transactions or more from the same amount. What this means, is that, a user can manipulate the system to the extent where he makes two or more transactions but is charged just once.
For instance, a blockchain double spending will occur when I send about 30 steem to @stream4u and before the transaction is validated and I get deducted of the 30 steem, I copied the transaction ID and manipulate it, and then send 30 steem to another username. So, I used 30 steem and made 2 transactions worth 30 steem each. And once the miners notice this, one of the transaction will validated and the other would be regarded as fake, hence, they will cancel 30 steem transaction, which means, one of the two users, I sent the steem to, will suffer the loss.
There are 3 various types of blockchain double spending, and they include;
- Race Attack
- Finney Attack
- Vector 76 Attack
Race Attack: This is a type of blockchain double spending where a hacker carries out multiple transactions using the same amount. The hacker races against time making multiple transactions before the transaction is validated by miners. This kind of transactions occurs in P2P, where the recipient accepts the transaction without waiting for validation from the miners.
Finney Attack: This is another type of blockchain double spending which occurs when a miner of a blockchain creates a fake transaction from the transaction details of a given block. The user will fall victim to this double spending because he/she is actually seeing proof of the transaction been made but didn't wait to confirm if such transaction has been validated and confirmed by miners.
Vector 76 Attack: This is another type of blockchain double spending where hackers take advantage of a blockchain by sending fake cryptocurrency to users for payment through the Vector 76 attack software. After sometime, when the miners will have to validate transactions, they will regard those transactions as fake, and such cryptocurrency will automatically disappear from the users wallet, hence, the users will incur loss, as they have paid for the crypto but were scammed of it.
How Bitcoin Handles This Problem?
Bitcoin blockchain handles this problem through the validation and confirmation of transactions by miners. Once a transaction has been validated and confirmed by miners only then can it be added as a block in the blockchain distributed ledger. So users have to be patient to know if their transaction has been validated and confirmed by miners before making payment to the sender of the BTC coins. Because once a transaction has been validated and confirmed by miners and added to the distributed ledger, it can not be changed or altered, hence, as a user/recipient you are assured that the transaction is real and not a blockchain double spending attack.
I hope you all found the article interesting and exciting. Do well to share your thoughts about the article in the comment section below. Thanks.
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