What is a fork?
A fork is a new coin that is heavily based on an existing coin, it’s blockchain and protocol. It maybe a soft fork or a hard fork.
A hard fork is a new coin and platform that is created by changing the underlying protocol of a coin and using the coin’s own duplicated blockchain history to airdrop more tokens to the existing coin holders. In simple terms, a fork is a duplicate coin of a premium cryptocurrency that has a fundamental change in its system that differs it from the original coin. Bitcoin Cash, Bitcoin Gold, Ethereum Classic, all are examples of hard forks.
A soft fork takes a less radical approach. It upgrades the existing coin’s protocol and presents itself as a cheaper, faster, more secure alternative of the original coin. All of the coins in the crypto market can be broadly called a fork of Bitcoin because the blockchain technology was started by it. But, generally, Dash, Litecoin, etc are considered soft forks of Bitcoin.
Duplicity is not generally highly liked within the crypto community except for evolutionary purposes for stagnant coins. That is why none of the new hard forks of popular cryptocurrencies are as successful as the original coins themselves and are still viewed as controversial.
But why is there a need for new forks?
There are several genuine reasons why we need new forks. We need soft forks for new competition in the cryptocurrency world and introducing new technology that can eventually be incorporated into the rest of the coins. Bitcoin’s upgrade might never have been possible if its soft forked competitors like litecoin and Dash didn’t make their system much faster. There is also the case of the increased liquidity since bitcoin and its network is hardly capable of handling such large traffic of transactions at a particular pace. So, these smaller coins offer viable alternatives for liquidity and trading purposes.
Hard forks are airdropped tokens that are given to already existing coin holders according to the amount of the original coin they are storing. If you owned a particular amount of bitcoin on Sep 1, 2017, you were allocated the same amount of bitcoin cash as part of the Cash hard fork. Once the hard fork is complete, it is completely independent of the previous coin and its blockchain since the underlying protocol is different and the network is entirely separated. Hard forks are very difficult to manoeuvre and you need a wide-ranging support from a portion of the cryptocurrency world to make it happen as it will fail if no one is willing to mine on it or dedicate their computers as nodes. If a significant portion of the crypto world supports your hard fork, it will eventually be legitimized and widely adopted. When Bitcoin Cash was created and separated from Bitcoin, there was mixed reaction from the crypto community but, it has slowly been reintegrated into the coin charts. The same cannot be said of Ethereum Classic or Bitcoin Gold.
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