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Not precisely. The only time you really need to worry about confirmations is when you're dealing with larger amounts. It costs a lot to pull off a double-spend,
by ewillbefull 14y ago
Not precisely. The only time you really need to worry about confirmations is when you're dealing with larger amounts. It costs a lot to pull off a double-spend, more than a tiny ATM transaction anyway.
This is why SatoshiDice processes immediately, except for bets over 2-5 BTC.
- swhitt 14y agoThe reason why SatoshiDICE can do this is because they include the output of the bet transaction as one of the inputs to the win/lose response transaction. If part of the bet transaction is doublespent there's a good chance it won't make it into a block. If the bet transaction doesn't make it into a block, the response transaction won't either and is therefore worthless.
- ewillbefull 14y agoNobody can cheat SatoshiDICE by double-spending and spending their response transaction, because the transactions are chained as you say. But this isn't the kind of attack they're worried about. If you broadcast a transaction and SatoshiDICE responds with a YouLoseTx, and you have built a block containing a double-spending transaction, if you "lose" you can broadcast your conflicting block. You wouldn't need much hashpower to do this and still remain positive. It's called a Finney Attack. https://en.bitcoin.it/wiki/Double-spending#Finney_attack https://en.bitcoin.it/wiki/Double-spending#Finney_attack This is why they only immediately respond to smaller bets.