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Can 2 or more people generate the same exact wallet. And if so, what happens then?

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Yes it's possible. One of them would spend the coins if it happens.

Recent example: https://www.cve.org/CVERecord?id=CVE-2023-39910

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    It's only realistically possible with broken random number generation. Commented Sep 23, 2023 at 21:28

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