{"id":8983,"date":"2022-11-17T10:07:15","date_gmt":"2022-11-17T07:07:15","guid":{"rendered":"https:\/\/crypto-mining.blog\/?p=8983"},"modified":"2026-02-07T09:44:35","modified_gmt":"2026-02-07T06:44:35","slug":"what-are-cryptocurrency-forks-and-how-to-work-with-them","status":"publish","type":"post","link":"https:\/\/crypto-mining.blog\/en\/cryptocurrencies\/what-are-cryptocurrency-forks-and-how-to-work-with-them\/","title":{"rendered":"What are cryptocurrency forks and how to work with them?"},"content":{"rendered":"
\"What<\/a><\/figure>\n\n\n

If you’re a fairly experienced crypto-user, you’ve probably heard about forks. But this topic is not covered in details, and it is very important for us. Let’s talk about them in details. To begin with, I suggest to understand what forks are and what cryptocurrency forks are.<\/p>\n\n\n\n

How does a cryptocurrency fork happen?<\/strong><\/h2>\n\n\n\n

As already mentioned, a fork is a modification of the blockchain protocol. Each blockchain has its own protocol, which is actually a set of rules that govern how the blockchain network works. These rules can describe, for example, how new transactions are added to the blockchain, what incentives miners should receive, etc.<\/p>\n\n\n\n

However, since the blockchain code is open, anyone can change these rules. For example, a miner might come up with a great idea to improve the scalability of Bitcoin. Let’s say he proposes to increase the block size in the blockchain of the first cryptocurrency. If other miners realize how beneficial such a change is, then they may agree to accept it. And when this happens, they say that a fork or split has occurred in the blockchain or cryptocurrency. We will look at this in more detail in the following sections.<\/p>\n\n\n\n

Interestingly, a cryptocurrency fork could result in two versions of the blockchain, as well as new coins that current holders can claim. However, it depends on the type of cryptocurrency fork. And now we’ll talk about the types of forks.<\/p>\n\n\n

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Types of Cryptocurrency Forks<\/strong><\/h2>\n\n\n\n

Cryptocurrency forks can be divided into two main types:<\/p>\n\n\n\n

Soft fork<\/strong><\/h3>\n\n\n\n

A soft fork is a backward compatible modification of the blockchain network. This means that the new protocol does not affect the old one, which can coexist with it. However, each miner must choose whether to use the new or the old protocol, potentially leading to a temporary network split.<\/p>\n\n\n

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Let’s take a closer look:<\/strong><\/p>\n\n\n\n

When changes are made to the blockchain protocol in order for them to fully take effect, all miners must update their nodes. However, in the case of a soft fork, nothing changes in the blockchain, but only new options are added. These options are not mandatory for miners – they can decide for themselves whether to use them or not.<\/p>\n\n\n\n

Let’s go back to our previous example where we talked about increasing the block size to achieve scalability.<\/p>\n\n\n\n

A miner impressed by this idea must update their node software to enjoy this benefit. But a miner who does not accept this idea will still use the old software to verify transactions on the blockchain. For a soft fork to be effective, most nodes must upgrade to the new protocol. Otherwise, the soft fork will fail or go unnoticed.<\/p>\n\n\n\n

Hardfork<\/strong><\/h3>\n\n\n
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A hard fork, on the other hand, is a backwards incompatible modification of the blockchain. That is, the old and new protocols are incompatible, which leads to a complete and final split of the blockchain. It is worth noting that in the case of a hard fork, there are two versions of the blockchain and, possibly, two coins. In addition, miners who refuse to upgrade to the new protocol will not be able to confirm transactions on the new blockchain.<\/p>\n\n\n\n

A hard fork can happen in one of two ways:<\/em><\/p>\n\n\n\n