The Double Spending Dilemma: From Traditional Cash Systems to Interoperable Blockchain Systems

Digital cash systems have been addressing the double spending problem for decades. Unlike the physical world, where currency naturally prevents duplication, digital systems must implement complex mechanisms to avoid double spending. In this positional paper, we examine the evolution of the double spending issue from early digital cash models to modern blockchain-based solutions, focusing also the emergence of double spending risks in interoperable blockchain ecosystems. We explore how the rise of blockchain interoperability introduces new vulnerabilities, potentially enabling novel forms of double spending across interconnected networks. In particular, we show how differences in economic conditions across blockchains, inconsistencies in network timing and transaction finality, market manipulations, speculative behaviors, and weaknesses in cross-chain mechanisms can collectively create new opportunities for double spending. By illustrating these issues through practical examples, we demonstrate that interconnected blockchain ecosystems require security models that extend beyond the assumptions of isolated networks.