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What is Forking?

Many new cryptocurrencies have emerged due to a fork, but what exactly is a fork?

Forks work by altering the blockchain’s software protocol. They are frequently associated with the creation of new tokens. The major methods of producing new cryptocurrencies include scratching or forking the existing blockchain.

Forks occur when the user developer community decides that something fundamental about a cryptocurrency needs to be changed or when two or more blocks have the same block height.

Most forks are transitory, but others are permanent. Temporary forks occur as a result of the difficulties in obtaining immediate consensus in a distributed system. Permanent forks that arise from protocol updates intended to bring new functionality to a blockchain, like Ethereum, Bitcoin, or Bitcoin Cash, can also be used to reverse the consequences of hacking. When this happens, the chain divides, resulting in a second blockchain that shares all of the original’s history but proceeds in a different direction.

A cryptocurrency fork can have a significant impact. They are frequently based on big price changes and have proven highly ambiguous in the past.

How do forks work?

As we mentioned before, there are two ways for providing new tokens:

  1. The first method is to create new tokens from scratch. This method involves copying and pasting existing code, which is then updated and launched as a new token. As an example, consider Litecoin, which began as a bitcoin clone. The founders changed the code, and as a result, others were persuaded, and it eventually became a popular cryptocurrency.
  2. The other option is to fork the existing blockchain. Alterations are applied to the existing blockchain through this strategy rather than starting from scratch. As the network splits, two versions of the blockchain are formed. As an example, consider the production of bitcoin cash. Differing viewpoints on bitcoin’s future allowed for the formation of a new cryptocurrency known as bitcoin cash from the original cryptocurrency known as bitcoin.

Forks are classified into two types: soft forks and hard forks

Hard Forking: A hard fork occurs when nodes of the most recent version of a blockchain no longer accept the previous version(s), resulting in a permanent divergence from the previous version of the network.

When a new rule is added to the code, it causes a fork in the blockchain: one path follows the new, upgraded blockchain, and the other way continues along the old path, creating a fork in the blockchain. Generally, users on the old chain will understand after a short time that their version of the blockchain is outdated or irrelevant and will rapidly switch to the latest version.

A hard fork occurs when the code changes so drastically that the new version is no longer backward-compatible with previous blocks. In this case, the blockchain divides into two parts: the original blockchain and a new one that adheres to the new set of rules. This creates a new cryptocurrency – and is the source of several well-known coins. Cryptocurrencies such as Bitcoin Cash and Bitcoin Gold arose from the original Bitcoin blockchain due to a hard fork.

Categories of Hard Forking

Programmed Hard Forks:

A programmed hard fork refers to an update that has previously been planned and is well known in the project’s roadmap. This upgrade is the same as software updates.

The community welcomes programmed hard forks since they can be viewed as an innovation to improve the capabilities of the blockchain. Along with it, the core developers and the community will work together to add transit to the new chain if the old chain is no longer usable. Metropolis is a well-known example of Ethereum’s third-stage development of a programmed hard fork with the goal of boosting scalability and privacy features.

Factiously Hard Forks:

This form of hard fork might occur when there is an internal disagreement within a project on how to solve a specific issue. During the dispute, a segment of the community will stray by generating a new chain as a result of a change in the underlying source code to improve specific features. Because this hard fork has not been agreed upon and is not supported by all community stakeholders, a new coin will be generated along with the new chain.

Spin-off Coins:

Since cryptocurrencies, most notably Bitcoin, are open source, their codebases are accessible to the public and can be updated to generate a new coin with different attributes. Almost anyone can create these spin-off coins by copying Bitcoin’s basic code and tweaking one or two items to create a new coin.

As an example of a spin-off coin, consider Litecoin, created as a fork of the original Bitcoin. Litecoin has a higher accessible coin supply and faster block confirmation times.


There are various reasons why developers may want to adopt a hard fork, including:

  1. Reducing critical security flaws detected in older versions of the software
  2. Introducing new features
  3. Reversing the transactions (alike when the Ethereum blockchain made a hard fork to reverse the hack on the Decentralized Autonomous)
  4. Hard forks, which form a new digital asset, are popular in the community since they provide free coins to balance the supply.


  1. It has the potential to cause significant instability.
  2. A hard fork often generates a significant rift in the community of digital assets advocates.

Soft Fork:

A soft fork is a backward-compatible modification that allows upgraded nodes to communicate with non-upgraded nodes. A soft fork is often defined by the inclusion of a new rule that does not conflict with the existing rules. Soft-forking, for example, can be used to reduce the size of a block.

Read more : What is the metaverse?

Segwit is an example of a soft fork. Segwit (Segregated Witness) modifies the transaction format of the Bitcoin Core software to enhance transaction capacity. Segwit was activated in August 2017 however it wasn’t until February 2018 that all active nodes on the Bitcoin network started enforcing it by rejecting non-segwit blocks and transactions.

Consider a soft fork to be a blockchain software upgrade. As long as all users adopt it, it becomes the new set of criteria for a currency. Soft forks have been used to add new features or functionalities to both Bitcoin and Ethereum, often at the programming level. The adjustments are backward-compatible with the pre-fork blocks because the outcome is a single blockchain.


  1. In soft forks, both the new and the old versions are totally preserved.
  2. All of the results are in one place.


It has the potential to provide lower security than a hard fork.

What would happen to my investment by forking my cryptocurrency?

When a cryptocurrency forks, you hold the same number of coins on both chains. You should choose whatever branch you desire on this occasion. It is clear that the issue of each fork will manifest differently, but this is entirely dependent on your particular preferences. Finally, if you are undecided about which group or coin to support, the best way to proceed is to conduct considerable research on each one before making a decision.

Determining which fork is better:

Some elements can influence the outcome of any project or coin. One of the essential elements to consider when deciding between two forks is if one has more favourable backing, whether from miners or investors. This may be tough to establish before the hard fork, but it is critical to consider before making your decision. It may also be prudent to analyse which of the two cryptocurrency projects has existed the longest and has demonstrated its worth over a long time.

You read this article in MonoMoney


Two kinds of fork are existing which are called soft and hard fork.

They both are for improving the blockchain’s protocols and necessary for your investment’s safety.

Could we use old rules after a hard fork ? no after a hard fork older version is not valid.

Which fork is better ? They both have some advantages and disadvantages.



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