Reversible transactions can play a key role in driving adoption of crypto.

The irreversibility of blockchain transactions is often touted as proof of crypto’s security. Because a Transactions can’t be undoneScammers cannot charge back money they have already transferred to buy a product. It provides the ultimate level of protection for sellers – especially those who might have been burned in the past using a third-party servicePayPal is an example of a site where chargebacks can be very common and difficult to challenge in case of fraud.

There’s an argument to be made that blockchain’s irreversibility is one of the reasons it is such a secure technology. There are also downsides to blockchain’s unique characteristics. Blockchain users are human beings. There are many mistakes made. The problem is that blockchain wallet addresses are essentially a long string of random numbers and letters, and it’s very easy to make a mistake when entering one manually. If the address is not correct and the transaction is confirmed then the funds will either end in an incorrect wallet or be lost forever to the ether.

Another problem is the complexity of DeFi. Users will often perform a series cross-chain transaction. One example is that they could borrow tokens from a protocol on one blockchain, bridge these tokens to another, and deposit them in a liquidity fund. This transaction is three-step and traders might use it to gain arbitrage opportunities. However, these transactions come with a high degree of risk if one or more of the steps fail.

Why Can’t Blockchain Transactions Be Reversed?

Transaction finality is key designFeature of blockchain that’s necessary due to its decentralized nature. Blockchain transactions can only be processed by validators after consensus is reached among all nodes. This is in contrast to bank transfers, which are handled by trusted third parties. Because the blockchain records are distributed across multiple nodes it is immutable. This means that no one user or node can alter the distributed ledger. The rest of the network will reject any attempt to alter transactions.

Blockchains are designed this way for security reasons, as it eliminates a problem known as “Double your spending“, where a user might try to cheat and use the same funds to carry out multiple transactions.

Because blockchains are decentralized, it is impossible to reverse a transaction. Only the person who received funds can return them. That can be problematic, because if funds are sent to a complete stranger, that person may well be tempted to keep them, as they won’t face any trouble for doing so.

Irreversible Transactions: The Problems

Many people view blockchain irreversibility positively, but it can also lead to major problems if mistakes are made. There’s a strong argument to be made that if cryptocurrency is to replace fiat as a mainstream payment method, then people will need a way to reverse transactions when funds are sent to the wrong address.

While most errors can be avoided by copying and pasting addresses, or scanning a QR code to scan them, these methods aren’t always perfect. It’s possible to accidentally alter the address after scanning it, for example. Or, the sender could enter incorrect amounts of coins. This is more common than most people realize. People often price items in U.S. Dollars or another fiat currency and then send the equivalent amount of crypto. A user will need to transfer 0.0027 BTC to send $50 in BTC. But it’s all too easy to accidentally send 0.027 BTC ($500) instead.

It’s not just mistakes that are a concern though. Hacking wallets is another problem. Users are assured that if their bank account has been hacked, and money is transferred out of it, the bank will eventually reimburse them the amount lost. This won’t happen with blockchain transactions, as there is no centralized body that’s able to provide the refund. Security is the sole responsibility and obligation of each user. This means that if your wallet is compromised you can almost certainly declare it lost forever.

Why a Safety Net is Important

It’s clear that many people stand to benefit from having the ability to reverse blockchain transactions. However, the difficulty is enabling this in a way that doesn’t compromise blockchain security. Crypto will be lost credibility if it is possible to send money for goods or services but then reverse that transaction once the product is delivered.

It’s a tricky problem to solve but there are some very smart minds that have already come up with a solution. One good example is the Protocol t3rnA platform developed by, that executes smart contract with a built in fail-safe mechanism to ensure complex transactions are processed correctly. Reversed completelyIf you have any questions.

T3rn is a great illustration of how the fail-safe mechanism functions in this blog post. Imagine a user planning a five step transaction. It involves bridging tokens Ethereum to Polkadot then to Moonbeam. Along the way, there are various swaps or deposits. These kinds of transactions are typically performed by DeFi traders, but can cause problems if the user doesn’t have enough coins in their balance to pay the gas fees for each transaction. If they run out on gas in step 3 or 4, the tokens will be held at this step. This can cause major headaches to the trader. They’ll almost certainly miss out on whatever arbitrage opportunity they were hoping to exploit.


With t3rn this isn’t a problem. The unique fail-safe mechanism of t3rn involves putting assets involved in every step of the transaction into escrow. In this way, they’ll only be released once each step of the transaction has been successfully executed. If any of the steps is not completed successfully, t3rn can cancel the transaction. All previous steps will also be reverted. As you can see, Bob will get his original ETH tokens back without having to pay any gas fees.

The beauty of t3rn’s interface is that it allows users create complex transactions with a simple user interface. Each step in the process is presented in a chronological manner. It supports multiple wallets, too. MetaMask, Ambire WalletOthers.

Paving the way for greater adoption

Blockchain reversibility that t3rn offers could prove to be a game changer for the cryptocurrency industry. This allows users to better protect themselves. digitalBy introducing a safety mechanism to every transaction, they can protect their assets. Tokens can be sent to $500 instead of $50. This gives the recipient a way of reversing the transaction and correcting the error without having to rely on the honesty of the person who got the funds.

This capability is essential and will benefit both ordinary users and DeFi trader alike. It may also increase trust in cryptocurrency overall. While blockchain’s transaction finality cannot, and should not be sacrificed, people still need a way to avoid being punished for honest mistakes. Providing this capability, t3rn may be able to assist in the onboarding of the next-generation crypto users who are more cautious and need some safety net.

Leave a Reply

Your email address will not be published.