Cryptocurrency did change the concept of currency without the chinking sounds or tangibility to assist the feeling of holding money. The screens display coins that are worth a few dollars and can be traded like other currencies. Bitcoin was the oldest cryptocurrency to have survived through a decade to stand strong even today. Many other altcoins came into existence after the launch of Bitcoin to set in a competition. Detractors have come into the picture too as the concept propagated itself into the public.
Technology backed the cryptocurrency to build several opportunities for a better insight into its working. One such innovation was the forks that multiplied over the years. Although many of them failed to impress the users, there are a few of them which continue to have trades happening. All crypto assets that are similar to Bitcoin in their appearance are called Bitcoin forks; same is the case with the altcoins. Let us have a look at Bitcoin forks and its history.
Types of Bitcoin Fork
The two types of forks are soft forks and hard forks.
· Soft Forks
It is essentially a change brought to the existing cryptocurrency protocol. A soft fork is known to be backwards compatible with nodes running old software, in which the nodes are servers or computers that record transactions or store the blockchain. You could consider a soft fork to be analogous to upgrading your phone’s operating system.
· Hard Forks
Just like the terms soft and hard, the two types of forks are opposites. These, too, are changes brought to a cryptocurrency protocol with no feature of being backwards compatible. Updating all nodes into the new version is necessary; a split can occur if they don’t. All these stages of failure could lead to the generation of a new cryptocurrency. Bitcoin Cash was a hard fork that increased the size of blocks of bitcoin to 8 megabytes from 1 megabyte. This was done to solve the problem of scalability that Bitcoin faced, as the existing currency was not able to handle large amounts of transactions. The community of Bitcoin Core preferred smaller blocks making for its incompatibility with the change in Bitcoin Cash.
As the original users of BTC split into two, there was a distinct boundary that separated them, which was the size of the blocks. The BTC users stuck to it for they wanted small blocks, whereas the people who shifted to BHC did so as they preferred bigger blocks.
History of Bitcoin Forks
The earlier mentioned fork, Bitcoin Cash was just one among the numerous Bitcoin forks that came into the market. Although the other forks couldn’t split BTC users into two, there were a few significant entries. One of the earlier Bitcoin hard forks to have been developed was Bitcoin XT, which started gaining popularity a few months after its launch in 2014. The other forks that followed Bitcoin XT were the Bitcoin Classic in 2015, Bitcoin Unlimited, Bitcoin Cash Fork, and Bitcoin Gold Hard Fork.