Chain Reorganization Cost

Definition ∞ Chain reorganization cost represents the resources expended when a blockchain’s historical record is altered due to a longer, competing chain gaining consensus. This cost includes the computational power, time, and potential financial penalties incurred by network participants involved in validating or re-validating transactions. It quantifies the economic disincentive against reversing previously confirmed blocks. A high reorganization cost helps maintain the integrity and immutability of the ledger.
Context ∞ The magnitude of chain reorganization cost is a critical metric in assessing a blockchain’s security and resistance to attacks, especially in proof-of-work systems. Debates often address the balance between transaction throughput and the economic security required to prevent deep reorgs. Ongoing research seeks to optimize protocol designs to increase this cost, thereby strengthening network resilience.