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Why does the wiki say that green addresses are "generally considered a bad idea and not advisable to implement."?

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Green addresses has receivers trusting the owners of the green address to not perform a double spend. However trusting anyone to not double spend in Bitcoin is inadvisable, regardless of whether they are actually trustworthy or are a corporation. Even if you do trust that the owner of a green address will not perform a double spend, double spends can occur by accident due to implementation failures (writing a wallet is hard).

There is also no guarantee that a transaction "from" a green address (note that there really is no such thing as a "from address" in Bitcoin, you don't actually send from addresses) is not guaranteed to confirm, even if no double spend occurs. The transaction may have too low of a fee to be confirmed in a reasonable time, and may even be low enough to be evicted from nodes' mempools if it remains unconfirmed for too long. There may be third parties performing transaction malleation attacks on those transactions resulting in malleated transactions being confirmed instead of the one that you expect.

In general, using green addresses means that you are trusting unconfirmed transactions which are not guaranteed to confirm. Double spends are not the only risks with accepting unconfirmed transactions, there are a variety of other things that could result in an unconfirmed transaction never confirming which the owner of the green address cannot control. As such, it is inadvisable to use green addresses.

  • If the transaction is using segwit then malleability is not possible Replace by fee can prevent the transaction from being rejected from having a too low fee – Ben Jul 16 at 4:27
  • The whole point of "accept unconfirmed transactions" is consider the outputs of the unconfirmed transactions safe to spend. If the fee is too low and RBF has to be used, any transactions that were chained off of the original unconfirmed one will be instantly invalidated. – Andrew Chow Jul 16 at 14:49

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