Home Glossary
Bybit Learn
Bybit Learn
Mar 17, 2022

Hard Fork

A hard fork is a change in the code of a cryptocurrency that splits a particular blockchain into two separate protocols.

A hard fork in crypto is a radical change to the protocol of a network that makes previous transactions and invalid blocks valid, or vice versa. All users or nodes then need to upgrade to the latest protocol software version. 

One of the biggest reasons why developers implement a hard fork is to correct vital security risks in a blockchain. Alternatively, they may want to reverse transactions, or perhaps add new functionalities to meet the community’s needs. An example is when Ethereum created a hard fork to reverse the decentralized autonomous organization hack in June of 2016

How It Works

Hard forks can happen on any crypto platform, which means that it’s not exclusive to Ethereum or Bitcoin. This is because crypto works in the same way, regardless of which platform is used. 

Miners in a blockchain are the ones who set new rules to transport memory on the network. These miners have a good understanding of the new rules. However, they must unanimously agree on the rules and implementation. 

Once there’s an agreement, the rules that have to be changed need to be “forked” to indicate the diversion or change in protocols. Developers will then update all of the software to reflect the new rules. 

In the case of Bitcoin, the forking process is what enables various digital currencies with names similar to Bitcoin to come into being, including Bitcoin Gold, Bitcoin Cash, and others. 

Soft Forks vs. Hard Forks 

Hard forks are commonly compared with soft forks. The two are similar in the sense that a blockchain’s pre-existing code is altered. 

However, with soft forks, only one blockchain will remain valid when the users adopt the update. With hard forks, the old version will still remain, effectively creating a new, latest version. 

Want to learn more about hard forks? Check out our article, which contains a more detailed explanation of a hard fork and its role in crypto.