What Is the Risk of “Forking” during the Final Settlement of a Trade?

Forking, where the blockchain temporarily splits into two competing versions, introduces settlement risk. A trade confirmed on one fork might be invalidated if the other fork is eventually accepted as the canonical chain.

This can lead to a trade being double-spent or reversed. Fast finality protocols mitigate this by making a fork reversal mathematically impossible, ensuring that the trade settlement is immediately final and irreversible.