What is a cryptocurrency Fork?

What is a fork? Cryptocurrencies like Bitcoin and Ethereum are powered by decentralized, open-source software called a blockchain. A fork happens whenever a community makes a change to the blockchain’s protocol, or basic set of rules.

What are crypto Forks & how do they work?

Most likely, they’re different spin-offs stemming from an original coin. They’re a result of changes, called “forks,” made to a blockchain’s protocol. If you’re considering an investment in crypto—forked or not forked—here’s what you should know about these blockchain offshoots. Crypto forks are essentially changes to a blockchain’s code.

What is a hard fork in cryptocurrency?

Hard fork: A hard fork happens when the code changes so much the new version is no longer backward-compatible with earlier blocks. In this scenario, the blockchain splits in two: the original blockchain and new version that follows the new set of rules. This creates an entirely new cryptocurrency – and is the source of many well-known coins.

How does a fork affect a cryptocurrency?

A fork can have a substantial impact on a cryptocurrency. They are often predicated by large price fluctuations and have proven to be quite controversial in the past. How Does a Fork Work? There are two main varieties of forks: soft forks and hard forks. What Are Soft Forks? A soft fork is any change that is backward compatible.