You should have wait for at least 1 confirmation unless you trust the guy. This is what happened in my guess:
- The guy sent coins to an address A which he owns and the fees were less of course
- He then sent the coins from the address A, and the coins of the address A were not confirmed yet.
- He then gone back to the first transaction and rebroadcast the first transaction with a higher fee. And in rebroadcasting process, the tx you had with address A gone dropped.
That’s amazing way to cancel it however I did not know this can be done with the bitcoin chain as well ?
I mean I have done this in case of Ethereum transaction but never with bitcoin.
What is the exact principle behind this technique? Isn’t the transaction once broadcasted is captured with the nodes and it permanently sits there?