Double Spend

1 min read

A double spend occurs when someone is able to spend the same money twice, fooling one or more parties into believing they have been paid.

Digital objects like files and text are easy to duplicate. However, duplication is not a desirable trait in money. This is the double spend problem: how can a receiver of digital money be sure that the money they were sent was not simultaneously sent to someone else? How can all members of a monetary network be sure others are not duplicating their money at will?

Bitcoin solves the double spend problem by using a decentralized ledger which all users can access. When one user sends bitcoin to another, they destroy the coin they own and create a new coin owned by the receiver. The destruction of the sender’s coin is recorded for all to see, so that they can never send it to someone else.