What is a Fork in Crypto?

A fork in the cryptocurrency world is when a blockchain splits into two. This can happen for a variety of reasons.

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In the cryptocurrency world, a fork is a change to the underlying protocol that generates new rules for the blockchain. A fork can be generated either intentionally by the core team developing the crypto (a “hard fork”), or unintentionally when two different versions of the protocol clash (a “soft fork”). Hard forks generate an entirely new blockchain and are not backward compatible, while soft forks are upgrades to the existing protocol that remain compatible with older versions.

The most common type of fork is a hard fork, which occurs when developers want to make changes to the underlying protocol of a cryptocurrency that are not backward compatible. This means that all users need to upgrade to the new software in order for it to work. If even one user doesn’t upgrade, then there will be two different versions of the blockchain running at the same time.

This can lead to all sorts of problems, as each version of the blockchain will have its own set of rules. For example, if someone accidentally sends money to an address on the old blockchain, it might be lost forever because it doesn’t exist on the new chain. This is why hard forks should only be done when absolutely necessary, and even then they should be carefully planned so that all users have ample time to upgrade.

The most famous hard fork in cryptocurrency history occurred in August 2017 when Bitcoin Cash split off from Bitcoin. This was an intentional hard fork done by a group of developers who disagreed with Bitcoin’s roadmap. They felt that Bitcoin had become too slow and expensive, so they decided to create their own version of the blockchain with different rules.

Soft forks occur when there is a change to the protocol that is backward compatible. This means that users don’t need to upgrade their software in order for it to work with the new rules. However, not all users will receive the benefits of the soft fork unless they do upgrade.

Soft forks are much less controversial than hard forks because they don’t involve any risk of splitting the network into two incompatible versions. However, they can still lead to confusion and problems if not implemented correctly. For example, if a soft fork goes wrong and not enough users upgrade, then it can end up being effectively identical to a hard fork anyway.

It’s important to note that forks can also occur at the application level (e.g., MyEtherWallet) without affecting other applications or cryptocurrencies built on top of Ethereum (e,.g., ERC20 tokens). These types of forks are usually much less contentious because they don’t involve any changes to Ethereum’s underlying protocol.

What is a Fork?

Forks happen in the crypto world when the community disagrees on how the blockchain should move forward. Forks can occur on any type of blockchain but they are especially relevant to the crypto world because of the decentralized nature of the technology. When a fork happens, a new coin is created that is a copy of the old coin but with a new set of rules.

Hard Fork

In the cryptocurrency world, a fork is an event where an existing cryptocurrency splits into two versions of the code. A hard fork (or sometimes hardfork) is a radical change to the protocol of a blockchain network that makes previously invalid blocks/transactions valid (or vice-versa), and as such requires all nodes or users to upgrade to the latest version of the protocol software. Put differently, a hard fork is a permanent divergence from the previous version of the blockchain, and nodes running previous versions will no longer be accepted by the newest version. This essentially creates a new version of the cryptocurrency that will develop on its own unique path.

Soft Fork

A soft fork (or sometimes softfork) is a change to the software protocol where only previously valid blocks/transactions are made invalid. Since old nodes will recognize the new blocks as valid, a softfork is backwards-compatible. Soft forks can introduce new features or restrictions that are not recognized by old nodes (and thus lead to invalid blocks), but since old nodes continue to recognize these blocks as valid, only a minority of hash power is required to enforce the new rules.

What Causes a Fork?

A fork can occur on any blockchain network, but it is more likely to happen on a network with a large number of users and transactions, like Bitcoin or Ethereum. Forks can happen for a variety of reasons, but most often they are the result of disagreements among developers about how the network should function or be governed.

When a fork occurs, the existing blockchain splits into two separate chains, one with the old rules and one with the new. This can cause confusion and disruptions for users and businesses that rely on the blockchain for transactions. It can also create opportunities for fraudsters to take advantage of the situation.

If you are holding cryptocurrency when a fork occurs, you will usually end up with coins on both sides of the fork. For example, if you had 1 Bitcoin before the fork, you would now have 1 Bitcoin on the old chain and 1 Bitcoin on the new chain. These coins will have different value depending on which exchange you use and which chain is more popular with users.

It is important to exercise caution when dealing with forks, as they can be complicated and risky. Be sure to do your research and only invest in forks that you understand before buying or selling any coins.

How Does a Fork Affect Me?

If you own any cryptocurrency, chances are you’ve heard of the term “fork.” But what exactly is a fork, and how does it affect you?

In the cryptocurrency world, a fork is an event where the underlying software of a currency is changed, creating two different versions of the blockchain. Forks can occur on different parts of the network, such as at the protocol level or at the blockchain level.

Forks can be planned or unplanned. Planned forks are usually initiated by the development team behind a currency in order to make improvements or add new features to the software. Unplanned forks usually happen as a result of hacking or other malicious activities.

If you own any cryptocurrency that is forked, you will automatically get an equal amount of tokens on the new blockchain. For example, if you had 10 Bitcoin (BTC) before the Bitcoin Cash (BCH) fork, you would now have 10 BTC and 10 BCH after the fork. These forked tokens are often called “airdrops.”

Forking a currency can have positive or negative effects on its price. If there is high demand for the new currency, its price will go up. If there is little demand, the price will go down.

In some cases, forks can lead to long-term price increases for both currencies involved. For example, when Ethereum (ETH) hard forked into Ethereum Classic (ETC), both ETH and ETC prices went up in the long run. In other cases, one currency may eventually die out while the other thrives. Only time will tell how forks will affect prices in the future.


In the end, a fork is simply a change to the underlying code of a cryptocurrency that creates two separate versions of the blockchain with different rules. Forks can be created deliberately by developers as a way to upgrade the underlying code of the currency, or they can occur accidentally if there is a disagreement among developers about how to update the code. In either case, when a fork occurs, holders of the currency will end up with both versions of the coin—one on each blockchain.

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