What Is the Risk of a ‘Reorg’ (Reorganization) to a Transaction’s Finality?

A 'reorg' (reorganization) is when a longer chain is discovered, causing nodes to switch from their current chain to the new, longer one, thereby invalidating and removing blocks from the old chain. The risk to a transaction's finality is that a transaction confirmed in a block that gets 'reorged' out is returned to the mempool, effectively being unconfirmed.

While the transaction is usually re-included in the new chain, the delay and temporary invalidation pose a risk, especially for time-sensitive financial operations or exchanges.