<p>Recourse is a term used in general terms to refer to things being made right.</p>

<p>If I kick a ball and the ball breaks my neighbor's window, my neighbor can insist that I make things right -- such as paying for the replacement cost.  If I don't, there are a number of approaches that can help make it so that I'll make things right, including posting a note on the mailbox sharing with my neighbors my action and response.  So in that scenario, my neighbor has some degree of recourse and I'll likely make things right.</p>

<p>When a person borrows money to buy titled property and there is a lienholder, the ability to foreclose / repossess the property is among the methods of recourse available to the lender.</p>

<p>When I order an item from someone on eBay and instead of my item arriving I get only an empty box, I can simply contact my credit card company to file a dispute and have the charges reversed.  That is my recourse.</p>

<p>With Bitcoin transactions, once they have confirmed it can be presumed they will never be reversed.  If in the example above with eBay, but instead where you had paid with bitcoins, there is little recourse available to you.  eBay might let you enter a negative in the seller's history, but they won't be able to reverse your payment.</p>

<p>So when accepting bitcoins for payment after seeing the transaction's status with 0/unconfirmed there is no guarantee yet that you'll receive the funds.   If you hand over cash to someone who you don't know, there's little you can do if the payment transaction to you gets double spent and your transaction never confirms.  Even if you know who the person is, there's likely very little you can do to get the bitcoins you were expecting from the transaction that never confirmed.  So that's why 0/unconfirmed transactions carry risk -- as they are not guaranteed and bitcoin offers no recourse if you do get scammed.</p>

<p>If you use an escrow party, at least then the recourse to scamming is the possibility that the escrow will not deliver the funds to the scammer.  Escrow provides some level of recourse for transactions where little existed.</p>

CC BY-SA 3.0
2013-04-05T23:06:43.827Z
2013-04-06T23:51:13.023Z
2013-04-06T23:51:13.023Z
Stephen Gornick
<p>This may not be a Bitcoin-specific question, but I still think it's better to ask it here.</p>

<p>I've seen discussions about accepting unconfirmed transactions, that it should not be done because of double-spend risks and such, but they also say that it's risky in non-recourse transactions.</p>

<p>So, what exactly is a non-recourse transaction? Is it related to whether the address is trustful? Or does it mean anything else?</p>

<transactions><confirmations>
What are recourse or non-recourse transactions?
Arturo Torres Sánchez
# What are recourse or non-recourse transactions?

(Asked by: username_0 on 2013-04-05)

This may not be a Bitcoin-specific question, but I still think it's better to ask it here.

I've seen discussions about accepting unconfirmed transactions, that it should not be done because of double-spend risks and such, but they also say that it's risky in non-recourse transactions.

So, what exactly is a non-recourse transaction? Is it related to whether the address is trustful? Or does it mean anything else?

**Tags:** transactions, confirmations


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## 1 answers

### Answer by username_1 on 2013-04-05. Score: 1 | Accepted answer

Recourse is a term used in general terms to refer to things being made right.

If I kick a ball and the ball breaks my neighbor's window, my neighbor can insist that I make things right -- such as paying for the replacement cost. If I don't, there are a number of approaches that can help make it so that I'll make things right, including posting a note on the mailbox sharing with my neighbors my action and response. So in that scenario, my neighbor has some degree of recourse and I'll likely make things right.

When a person borrows money to buy titled property and there is a lienholder, the ability to foreclose / repossess the property is among the methods of recourse available to the lender.

When I order an item from someone on eBay and instead of my item arriving I get only an empty box, I can simply contact my credit card company to file a dispute and have the charges reversed. That is my recourse.

With Bitcoin transactions, once they have confirmed it can be presumed they will never be reversed. If in the example above with eBay, but instead where you had paid with bitcoins, there is little recourse available to you. eBay might let you enter a negative in the seller's history, but they won't be able to reverse your payment.

So when accepting bitcoins for payment after seeing the transaction's status with 0/unconfirmed there is no guarantee yet that you'll receive the funds. If you hand over cash to someone who you don't know, there's little you can do if the payment transaction to you gets double spent and your transaction never confirms. Even if you know who the person is, there's likely very little you can do to get the bitcoins you were expecting from the transaction that never confirmed. So that's why 0/unconfirmed transactions carry risk -- as they are not guaranteed and bitcoin offers no recourse if you do get scammed.

If you use an escrow party, at least then the recourse to scamming is the possibility that the escrow will not deliver the funds to the scammer. Escrow provides some level of recourse for transactions where little existed.


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