What is a fork in the context of cryptocurrency?

[XKUBI]

In the context of cryptocurrency, a fork refers to a divergence or split in the blockchain's transaction history. It occurs when a blockchain undergoes a significant change, resulting in two separate versions of the blockchain with a shared history up to a certain point. There are two main types of forks: soft forks and hard forks.

1. Soft Fork:
   • A soft fork is a backward-compatible upgrade to the blockchain protocol.
   • It imposes new rules that are more restrictive than the existing rules.
   • Nodes that haven't upgraded to the new rules can still validate transactions, as they consider the new blocks valid.
2. Hard Fork:
   • A hard fork is a non-backward-compatible upgrade to the blockchain protocol.
   • It introduces new rules that are not compatible with the old ones, leading to a permanent divergence in the blockchain.
   • Nodes that haven't upgraded to the new rules consider the new blocks invalid.

 

[Suba]

A soft fork is a software change but does not give rise to a new blockchain, while a hard fork will give rise to a new blockchain, like a Bitcoin hardfork which gives rise to Bitcoin Cash, and Bitcoin holders will get the same amount of Bitcoin Cash as Bitcoin. And I got BCH on Coinbase as a Bitcoin hardfork.