Home » What do you need to know about bitcoin hard forks?
Hard forks are deep-seated alterations in a particular cryptocurrency network. Although websites like
bitalpha-ai.io will help you begin cryptocurrency and commodity trading without any prior trading training, you have to confer two easy steps to achieve trading goals. For example, hard forks in the bitcoin network occurred initially, and then the concept arrived in other digital currencies. With the subsequent hard fork, the dynamics of cryptocurrencies changes immensely.
What is a hard fork?
A hard fork changes the rules of a cryptocurrency network, making previously invalid blocks/transactions valid. Such new blocks are added to the existing blockchain, which makes it incompatible with other cryptocurrency networks.
Why did they happen?
Hard forks happen when developers have a deep-rooted disagreement regarding the platform’s future direction. This disagreement can be anything – something unexpected happens, and programmers disagree on whether the upgrade should go through or not.
Hard forks also occur after an upgrade is released, which brings in new features but splits off into new crypto networks, as well as bug fixes and security updates, due to different approaches used by programmers from other teams.
History of bitcoin hard forks!
The hard fork talks about an upgrade in the transaction processing capabilities. The main focus of this fork is to increase the size of the block from 1MB to 8MB, which means more transactions for the same amount of data and increased transaction processing speed.
Bitcoin XT was released in August 2015 by Mike Hearn and Gavin Andreesen. A new version of Bitcoin XT 0.11A was released later with full signature support for peer authentication and a different proof-of-work algorithm called “Cuckoo Cycle.”
It is a hard fork that tried to deal with scalability issues by increasing the block size limit to 2 MB, which means more transactions processed at a time and faster transaction processing speed. On 28th December 2015, Bitcoin Classic came into live-action, and the most notable supporter of this fork is Olivier Janssens, a renowned businessperson with $4 billion in assets. This bitcoin hard fork talks about increasing the block size by allowing more transactions that one can process at a time and growing transaction processing speed.
Bitcoin cash, also known as Bcash, bitcoin ABC or simply ABC, is a hard fork of the Bitcoin network that resulted in the creation of a new digital currency, Bitcoin Cash. They are two separate blockchains now but share a common history before August 2017, when they were one currency.
On 24th October 2017, bitcoin gold – a hard fork of bitcoin- was launched by Jack Liao, the CEO and founder of Hong Kong mining company lightning ASIC. The primary purpose of this fork is to change the proof-of-work algorithm used by bitcoin, which opens new possibilities for different mining coins and makes it feasible to mine using home computers.
How do you benefit from a hard fork?
Hard forks update a particular cryptocurrency network with new features. It can be done in two ways, updating the core code that regulates the rules of a specific cryptocurrency network or upgrading the network’s capabilities by changing its underlying protocol.
Difference between a hard fork and a soft fork!
The main difference between a hard fork and a soft fork is that the soft fork is backwards compatible with the older versions, while the hard fork completely goes away from the older version.
Soft forks help change cryptocurrency protocols without disturbing the stability and functionality of an existing network. The outcome of a soft fork depends on people’s willingness to upgrade their wallets and nodes.
How does a hard fork happen?
A cryptocurrency network depends on its users and miners who process transactions and create new blocks. A hard fork initiates when a block in a blockchain satisfies certain conditions (like block size or several transactions).
What was the first bitcoin hard fork?
Bitcoin XT was the first hard fork in the bitcoin blockchain on 15th August 2015. It aimed at solving the scalability issues by increasing the block size limit and decreasing transaction processing speed. Bitcoin gold is a proposed digital asset standard that would result in moving away from using specialized hardware.
What is a hash war?
A hash war is a term used to describe deep conflict and competition between two factions of miners who try to establish dominance over each other by solving blocks as fast as possible while spending considerable money on it.