How Does Double-Spending Affect Market Liquidity?

A successful double-spend attack would severely damage confidence in the cryptocurrency, leading to a massive sell-off and withdrawal of funds from exchanges. This sudden loss of trust would cause liquidity to dry up rapidly, making it difficult to buy or sell the asset.

Exchanges and other financial institutions would halt trading to mitigate their risk.

What Risks Does a Team “Token Dump” Pose to an ICO Project?
What Is Double-Spending and Why Is a 51% Attack Necessary to Execute It?
What Is the Risk Associated with Short-Term Options Due to High Theta?
What Happens to Impermanent Loss in a StableSwap Pool If One Stablecoin De-Pegs Severely?
What Are the Long-Term Consequences for the Attacked Coin’s Value?
What Is ‘Double-Spending’?
What Is the Impact of a Short Vesting Period on Investor Confidence?
How Does ‘Double-Spending’ Directly Impact an Options Contract’s Collateral?

Glossar