What is a hard fork?
Hark forks are created when the blockchain underpinning a cryptocurrency is split into two separate paths. This split causes a new cryptocurrency to be built. A soft fork is more or less the same thing, but the idea is that only one blockchain (and hence one token) will stay valid as users embrace the upgrade. Both fork types develop a split, but a hard fork is meant to establish two blockchains and tokens. A soft fork is meant to result in just one of each. The Segwit upgrade to Bitcoin is an example of a soft fork. For an example of a hard fork, look to Bitcoin Cash and Segwit2x.
What happens when a blockchain forks?
One blockchain ends up being dominant, resulting in the other blockchain having low community adoption and value. Both blockchains are adopted, co-existing and running separately of one another with roughly same neighborhood adoption and value. Both blockchains are taken, but one is preferred. One of the two chains ends up being or remains the control chain (however the other chain preserves an affordable level of neighborhood support and worth). Any of the three instances can take place with a given fork. However, the 3rd choice is the most typical and thus the anticipated result gradually with hard forks.
What happens to your tokens?
Anybody who held coins before a fork, and during the fork, therefore will always have coins on both forks after the fork has taken place. The photo takes place at a block number; the block number is significant with forks, the calendar date is only relevant in understanding when the block number took place. Hence, in the primary, if one wants to “be in for the fork,” and therefore get “complimentary coins” they should have their transaction included to the ledger before the fork happens.
How are forks created?
Any update to a token’s software (a minimum of those that are democratically controlled like Bitcoin) requires some consensus. This is also true for executing a soft fork or a hard fork. Producing a fork that updates the existing software application that everybody is currently using needs majority support (consensus) from coin holders (more technically “nodes”) linked to the coin’s network. Those nodes have to agree to the upgrade and upgrade their software accordingly. With that kept in mind, forks need consensus relating to an update being adopted. Concerning just producing a hard fork or soft fork (not passing it), anyone can take a coin’s code and alter it, and thus develop a hard fork or soft fork to be adopted possibly.
Who can create a fork?
Any developer with the required skills might choose to fork Bitcoin or develop a unique copy of Bitcoin (thus all the perspective and real Bitcoin forks). That is the “simple,” aspect. The more difficult issue is getting miners on board, as well as the users, and exchanges. Without support from miners and users, there is no functioning blockchain. Without help from exchanges, there is likely little to no value.
Can you create a fork?
You can go to GitHub and get the code of Bitcoin, for example, and then do the work required to upgrade the software application. Not anybody can get enough miners to mine the new coin, enough users to update their software application or download wallets for the token, and enough exchanges to note it. Then, even if they can, getting anything near to the same assessment as the first currency is an uphill struggle.