Cryptocurrency is increasingly gaining popularity amongst traders and companies alike. There is a noticeable shift in investments as more and more traders are moving towards digital currencies like Bitcoin. Moreover, the fact that renowned companies are now accepting payments for their goods and services in digital currencies further promotes a more significant shift in trading trends.
No agency or government per se regulates cryptocurrency. It offers an autonomous trading platform that is secure and stores all the records of transactions. However, no matter the experience, there is always room for human error while making payments or trading cryptocurrencies. This article looks deeper into how to cancel a Bitcoin transaction and everything related to it.
Cancelling a Bitcoin Transaction
While there are a lot of benefits of making transactions in Bitcoin, it is impossible to cancel the payment once confirmed. A confirmed transaction is permanent and recorded in the system. However, if the confirmation is pending or remains unconfirmed, there are a few ways to cancel it.
What is an Unconfirmed Transaction?
An unconfirmed transaction is when the trader doesn’t receive any confirmation message regarding the payment within the first 24 hours from the BTC blockchain. There are two possible reasons why a transaction may remain unconfirmed:
#1. Low Transaction Fee
There are a few transactions whose transaction charges are too less, sometimes even zero. Such payments often stay unconfirmed from the blockchain.
#2. Network Overload
Many times BTC blockchain is unable to confirm payments due to network overload. The inability to process transactions quickly also leads to unconfirmed transactions.
How to Check for an Unconfirmed Transaction?
To check whether confirmed or unconfirmed transaction, you can follow the following steps:
- Visit a block explorer website. Blockchain.info is a popular choice for this.
- Enter the transaction ID that you must have received after making the payment in the search bar.
- You’ll be redirected to the information page of the payment with the number of confirmations.
If the number of confirmations displays 0, you have a chance to reverse the payment within 24 hours.
How to Cancel a Bitcoin Transaction?
There are two ways to cancel a Bitcoin transaction if it remains unconfirmed for 24 hours:
#1. Replace By Fee
There are a few wallets and exchanges that support Replace By Fee (RBF) strategy. It allows the trader to replace their original transaction with a new one for a higher transaction fee.
However, RBF can only be implemented if the trader opts for the transaction replaceable option while making the original payment.
#2. Double-spending Transaction
A double-spending strategy is a method where the trader makes a new Bitcoin transaction and sends an equal amount to themselves. To successfully enable a reverse transaction through this method, the transaction fee must be higher than the previous payment’s. A higher transaction fee enables quicker recognition by the miners, hence validating the transaction.
However, many wallets and exchanges protect themselves against double-spending, implying that this method may or may not work.
While trading in cryptocurrency may seem tedious for someone starting out, the advancement in technology and developments of AI-backed software makes investment simpler. Platforms like Crypto Engine safeguard you from making erroneous transactions without spending too much time fretting over which digital currency to purchase.
Crypto Engine rigorously analyses market trends and automatically executes the trade to convert the most profitable opportunities in the cryptocurrency market.
Bitcoin is one of the most advanced payments accepted by an increasing number of companies and brands. However, regularly transacting in cryptocurrency also increases the chances of incurring an incorrect transaction. If confirmed transactions are permanent and irreversible, unconfirmed transactions leave scope for reversibility. Another way to carry out secure transactions and bank on profitable trading opportunities are to use software like Crypto Engine.