What Is a “Zero-Confirmation” Transaction and What Are Its Inherent Risks?

A zero-confirmation transaction is one that has been broadcast to the network but has not yet been included in a mined block. The inherent risk is that the transaction is not final and can be easily reversed or double-spent.

The transaction may never be confirmed if a conflicting transaction with a higher fee is broadcast and included in a block first. Merchants who accept zero-confirmation transactions prioritize speed over security, making them vulnerable to race attacks and simple double-spends.