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Bitcoin Falls 11% After Report Suggests ‘Double-Spend’ May Have Occurred

Bitcoin fell 11% on Thursday and reached its lowest level in close to three weeks.

The nominee for treasury secretary of the Biden administration, Janet Yellen, seems to have suggested during the confirmation hearing that took place last Tuesday that lawmakers may “curtail” the use of Bitcoin as a result of it being used for illegal activities.

On top of that, BitMEX Research published an analysis on Wednesday, which indicated a critical flaw, dubbed “double-spend,” had taken place in the Bitcoin blockchain.

In short, double-spend means that a person has been able to spend the same Bitcoin twice. This could represent a huge problem in the blockchain, especially since it was believed that Satoshi Nakamoto had solved this issue all the way back in 2009.

Other tries at releasing a digital cash system were eventually stopped because of the double-spending incident being too close to reality, something that would have made people not trust the system.

BitMEX Research has tweeted that “it appears as if a small double-spend of around 0.00062063 BTC ($21) was detected.”

The research company later clarified that the double-spend they noticed was simply an RBF transaction. This was when a BTC transaction that wasn’t confirmed was replaced with a new transfer paying a higher fee. On the other hand, BitMEX’s Fork Monitor confirmed that “no (RBF) fee bumps have been detected.”

BitMEX continued to tweet about the incident: “A transaction in the losing chain sent 0.00062063 BTC to the address 1D6aebVY5DbS1v7rNTnX2xeYcfWM3os1va, and a transaction in the winning chain, which spent the same inputs only sent 0.00014499 BTC to this address.”

Eventually, it would seem like the double-spend didn’t even take place, at least, according to Bitfinex CTO Paolo Ardoino. He said 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.”

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