What is nonce?

In Ethereum, every transaction has a nonce. The nonce is the number of transactions sent from a given address.

Each time you send a transaction, the nonce increases by 1. There are rules about what transactions are valid, and the nonce is used to enforce some of these rules. Specifically:

• Transactions must be in order: You cannot have a transaction with a nonce of 1 mined before one with a nonce of 0.
• No skipping! You cannot have a transaction with a nonce of 2 mined if you have not already sent transactions with a nonce of 1 and 0.

Why?

This field prevents double-spends, as the nonce is the order in which transactions are sorted. In order for a double-spend to be successful, you typically ...

• Send a transaction to one party
• Wait for it to register
• Collect something in return from this first transaction
• Quickly send another transaction with a high gas price
• Have this second transaction mined first, therefore invalidating what would have been the first transaction

This is why exchanges wait for you to have a certain number of confirmations before allowing you to trade freshly-deposited funds.

With Ethereum, the above is not possible

This method of double-spending is not possible on the Ethereum blockchain because each transaction has a nonce included with it. Even if you attempt to do the above, it will not work because the second transaction (nonce of 3) cannot be mined before the first transaction (nonce of 2).