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Bitcoin Double Spending: Is It Possible?



Two Bitcoin
Image Source: Pixabay

The entire existence of bitcoin is built on the premise that it can be transferred from one person to another without the help of a third party. It was built to transfer payment as easily as we transferred files from one device to another. 

But when money can be transferred as easily as a document or music file, it means a copy of the original money can be spent several times. Double spending therefore became a major challenge for digital money. 

The powerful and perhaps the most important technology of this century, blockchain is what solves the problem of double spending. This distributed ledger technology makes double spending practically impossible. Once transactions have been validated and a new block has been added, it is impossible to alter the distributed ledger as there’s no centralized ledger. 

Digital information is relatively to reproduce, this is why pro double spending is a major problem of digital currencies. Fiat currency doesn’t have this problem. Cash handed to a cashier, or anyone cannot be reused again. With the technology behind bitcoin one can say – bitcoin double spending is impossible but is it really? 

Has double spending occured on the bitcoin network?

On 21st January there was news that a possible bitcoin double spend caused bitcoin to fall 11%.  A BitMex research suggested that there was a double spend flaw and double spending had occurred on the bitcoin blockchain. If this was true it could mean the 12 year old digital currency was just a hoax and Satoshi’s whitepaper wasn’t exactly true. 

BitMex research tweeted at first that there was a possible double spend of 0.00062063 BTC ($21). Then there was another tweet that the transaction was actually an RBF. A situation where a transaction has been unconfirmed and replaced by a new one. When this happens there should be a bump in transaction fees but there wasn’t. 

After another tweet by BitMex research it was concluded that there was no double spending. Insider reported according to Bitfinex CTO, Paolo Adriono that “In fact, what happened is that two blocks were mined simultaneously. As a consequence, there was a chain reorganization, which did not result in double-spending.”

The news did have some investors worried. If bitcoin wasn’t really solving the very problem it was designed to solve things could end badly for the crypto market. The clarification however doused tensions.

COO of OKcoin Jason Lao also told Coindesk  that the chain reorganization that occured was a common one. 

What caused a reorganization.

Bitcoin mining is highly competitive. Sometimes mining pools mine the same block at the same time which causes a split in blockchain history. 

Now there’s a chain A and a chain B but there can only be one chain. If the next miner decides to add a block to chain A and the next 4 miners decide to add to chain B, chain B wins out over A and chain A becomes an irrelevant chain. 

It is for this reason however, that Satoshi said a transaction should only be considered final after six more blocks have been mined to the chain that recorded the transaction. 

Events such as this goes to prove how solid blockchain technology is and how accurate the bitcoin whitepaper is. 

Double spending is the reason many proposed digital currency projects before bitcoin failed. Satoshi Nakamoto’s whitepaper solves this problem and in the last 12 years of bitcoin’s birth there hasn’t been any flaw in its security protocol. 

Blockchain technology makes makes bitcoin double spend impossible. However, there is a scenario where blockchain might fail. This scenario is the 51% attack. This attack can happen if 50% of the computing power needed the run the distributed ledger is held by one user. This user will be able to process transfers and reverse them as if they never happened.


Bolu Abiodun is a recent graduate of Theatre and Media Arts, Federal University Oye-Ekiti. A journalist with over a year's experience on the job. A former editor at American Media company Project Forward, he is a skilled content creator, social media manager and digital marketer.

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Why The Average Informed Nigerian Is Crazy About Twitter And Bitcoin



Image Credit: Kabiru Yusuf

It goes without saying that cryptocurrencies are quite popular in Africa’s largest country. This popularity exists quite pervasively amongst a demographic of the young, internet surfing section of Nigeria’s population. Obviously, access to information and particularly the internet are key to the penetration of any cryptocurrency in any society, and this informational access isn’t particularly lacking in Nigeria. 

Nigeria has an internet penetration of about 50% amounting to around 104 million people with internet access according to DATAREPORTAL. 15.8% or 33 million people use social media in Nigeria with 61.4% of that figure using the micro-blogging platform, Twitter. Therefore, there are around 20 million twitter users in Nigeria, almost a tenth of the country’s population. While this may not seem like a lot compared with the rest of the nation, Twitter has been instrumental in Nigeria in formulating public opinion, having conversations as well as being a site for various campaigns. The power of Twitter in the hands of Nigerians became very apparent in October 2020 as it was the platform of choice for the organization of the now infamous #ENDSARS protests.

Quite a lot of reasons make twitter as popular as it is especially amongst Nigeria’s young people. The ease at which posts on twitter could travel far and wide compared to many other social media platforms means it is a solid tool for advertisement for large and small entrepreneurial ventures alike, the latter of which many Nigerians are participants of. Secondly, Nigerians have grown weary and distrustful of traditional media outlets and often times get their information through social media, thereby, turning Twitter into a place where views can be aired quite easily. The fast nature of information transfer on twitter allows it to be the platform of choice for activities such as crowdfunding, organization of protests and in some cases, crime watch.

Bitcoin serves as the umbrella term for cryptocurrencies, especially in Nigeria, much like “Indomie” does for noodles. Nevertheless, as Africa’s Bitcoin Nation, cryptocurrencies have seen tremendous growth in Nigeria over the last few years. This growth is largely driven by the same demographic that dominates social media use. 32% of Nigerians surveyed online by Statista said they owned at least one cryptocurrency asset. And, in the first quarter of 2021, Nigeria’s peer to peer BTC trade volume was in excess of $99 million, nearly 3 times the volume of the next highest nation, Kenya. In 2020, Nigeria generated $400 million worth of bitcoin transactions, ranking third place worldwide behind the US and Russia.

So why are bitcoin and/or other crypto assets so popular? Well for one, it highlights the dire state in which Nigeria’s economic scene finds itself. Nigeria’s unemployment rate stands at 33.3%, which is what one would describe as dangerously high. Also, the local currency, the Naira, has been constantly fraught with increasing inflation. Hence, the naira has been largely unstable and it’s purchasing power has fluctuated a lot recently. In response, a lot of people have turned to cryptocurrencies to act as a buffer against the volatile economic scene. Furthermore, the decentralized and peer-to-peer nature of cryptocurrencies give a lot of people a preferred alternative to traditional banking institutions.

The benefits afforded by cryptocurrencies like Bitcoin and social media platforms like Twitter were put on full display during the #ENDSARS protests. Twitter was the mobilization platform of choice for its ease in information dissemination while bitcoin was the value exchange system of choice for crowdfunding and financing the protests due to the inability of regulatory authorities to pin down cash flow. All in all, both platforms underscore a discontent and distrust of the populace toward traditional methods of communication or wealth creation. 

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The “Off-ramp Dilemma”: Is Bitcoin Truly Untraceable?



Image Credits: MichaelWuensch / Pixabay.

$2.3 million.

That was the amount recovered by the Justice Department of the Federal Bureau of Investigation (FBI) from a group of online hackers known as “Darkside”, earlier this month. It was also revealed that the federal agency had recouped more than 1 billion dollars in Bitcoin value from investigating chains of fraudulent activities. Also, a Czech national, Tomas Jorikovsky had his assets seized in connection with stealing a $40 million bitcoin equivalent sometime in 2015. This, and a host of others have become a slow but humbling discovery. Yet, it is not only stunning but also a positive oddity.  

Bitcoin is widely recognized as a decentralized, secure, and most importantly, anonymous crypto-currency which involves the exchange of value through a virtual network. It is built in such a way as to shield the identity of persons involved in any bitcoin transaction, and whose activities are registered on a decentralized ledger system known as Blockchain. Put simply, it is a form of digital currency which operates independently of any 3rd party oversight. Thus, due to its anonymous character, bitcoin has been utilized by many to perpetrate and finance an array of crimes ranging from tax evasion, money laundering among others, since its launch in 2009.

As earlier indicated, bitcoin has no physical balances and only makes use of a somewhat “pseudonymous” makeup to facilitate transactions. This makes it susceptible to be used in shady deals to defraud people of their money in bitcoin value. Once this is done, it is nearly impossible to track or even recover the lost sum. Yaya Fanysie, an adjunct Senior Fellow at the Center for a New American Society noted that bitcoin is a choice for scammers just because of its anonymous elements. 

Moreso, we witnessed how the Twitter accounts of influential persons like Bill Gates and Obama were hacked in the past year and millions of people were scammed of their money in a bitcoin scheme. That was the last to be heard of it. 

If the narratives were true, how then have law enforcement agencies been able to break the jinx, recover stolen money from bitcoin and nab criminals? The answer lies in clarifying a prevalent myth that bitcoin is “entirely” untraceable. Since the records of a bitcoin exchange are recorded on a public, transparent and permanent ledger (blockchain), it leaves a trail for these agencies to latch on. This is intensified by using particularly sophisticated programs devised by software companies to do just that. Therefore, when criminals convert their coins to traditional currencies or want to spend the same, they are quickly highlighted for enforcement agencies who make the move on them. So granted, bitcoin is anonymous. However, it is not as private as is widely misconstrued. This leaves room for its traceability, if and when necessary. 

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Cryptocurrencies: The Emerging Face Of Money In Africa



A financial seismic shift is quietly but rapidly sweeping the coasts of Africa, with Bitcoin and other cryptocurrencies championing the movement. The volume of crypto-related activities in Africa have continued to surge. Between May 2015 and December 2020, Nigeria traded a total of $566,668,692 worth of bitcoin on Paxful, making it the second largest bitcoin market on Paxful, globally. However, Nigeria is not the only African nation with a strong interest in cryptocurrencies. Other African nations such as Kenya, South Africa and Uganda experience similarly high engagements in the crypto space, coupled with investments of millions of dollars in crypto assets.

Traditional financial systems in Africa are plagued with inefficiencies and detrimental centralized structures, making Africa a very fertile ground for the integration of cryptocurrencies in its financial systems. The number of unbanked Africans still lies in the realm of hundreds of millions of Africans, all of whom lack access to wealth-building financial services that can uplift them from poverty. This presents a huge opportunity for cryptocurrencies to penetrate the African market since cryptocurrencies can drastically increase financial inclusion in Africa by increasing the mobility of money, lowering transaction costs and reducing the requirements for accessing financial services to the barest minimum.

The success of digital fintech innovations in Africa like M-Pesa in Kenya shows how much is possible if cryptocurrencies are effectively utilized to transform the face of finance in Africa.

Besides Africa’s low level of financial inclusion, the issue of inflation and weak local currencies is another serious cause for concern in Africa. Between 2016 and 2020, the Naira has dropped by about fifty percent, from around #200 per USD to slightly over #400 per USD, thereby, reducing the networth of individuals by 50%. Zimbabwe’s inflation is even more alarming. In 2015, 100 trillion Zimbabwe Dollar notes were printed in notes, with each note having a mere worth of just 40 US Dollars. To prevent worse financial catastrophe, Zimbabweans turned to bitcoin, leading to an increase in the nation’s bitcoin activities.

South Sudan, like Zimbabwe, also battles with inflation. In 2016, it experienced an inflation rate of 295%. Storing assets in stablecoins like Tether (USDT) would easily provide protection against the drastic devaluations of local currencies in Africa. With Africans now beginning to see cryptocurrencies as a means to safeguard their wealth against drastic devaluation, cryptocurrencies are already threading a path to becoming the primary means of financial transactions and wealth storage in Africa.

In addition to safeguarding Africans from the effects of devaluation, cryptocurrencies also open up new paths to wealth creation for the numerous unemployed and financially weak Africans who are exploring new ways to improve their standards of living and make more money.

Crypto-powered financial transformations, however, are already happening in Africa. Crypto exchanges are already making financial transactions in Africa more seamless and even lowering the staggering cost of cross-border remittances in Africa. Africans are already venturing into bitcoin trading to make more money. Financial systems are already witnessing a quiet but prominent revolution and decentralization.

The gaps that exist in Africa’s financial system present an opportunity for cryptocurrencies to stir financial transformations. Although investing in and utilizing cryptocurrencies could be risky, not utilizing cryptocurrencies could even be more risky. With Africa’s surging crypto-related activities, it is gradually becoming evident that Africans are placing a huge bet on cryptocurrencies and a crypto-driven financial revolution in Africa is already underway.

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