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April 19, 2023

A quick understanding of Bitcoin hard forks

When investing in cryptocurrencies, you have to take time understanding all of the important terms. Among these are forks which refer to assets that are related to certain blockchains like Bitcoin. 

Throughout the years, there have been several popular coins in the market, among them is Bitcoin which happens to be the highest valued one. With the undeniable success it has amassed since it was released, developers are inspired to create other assets that are patterned on Bitcoin’s protocol. These are called hard forks and most of them can also be used to play your favourite Bitcasino slots. 

There are several assets that were hard forked from the Bitcoin blockchain, thus leading to the rise of several Bitcoin forks in the market. Aside from the fact that they can also be used to play Bitcasino live casino games, here are other facts you would have to know about them: 

What are Bitcoin hard forks? 

Before digging deeper into the examples of hard forks, it is important that you have a better grasp of them first. A hard fork is a rule modification that has significant effects on the blockchain network's whole protocol. With this, blockchain's creators or members of the community can create a fork.

Since a hard fork permanently diverges from the prior version of the blockchain, it effectively establishes a brand-new currency. This gives users the option to stick with the original one or to go with the new one. This makes the assets become ‘backwards-incompatible’ with one another. 

With the massive popularity of Bitcoin, many people were quick enough to point out its flaws and what can be addressed. As a result, there are several hard forks that were created out of the Bitcoin blockchain, which later became known as Bitcoin hard forks. 

How do they work?

Now that you know what Bitcoin hard forks are about, you may wonder how they work. A hard fork in crypto can occur on any crypto platform, in this case, Bitcoin. 

A hard fork occurs when the software used to implement bitcoin and its mining processes is upgraded. This means that once a user installs the newer version, the older version rejects all transactions, thereby forming a new branch of the blockchain.

Blockchain blocks can be imagined as memory-moving cryptographic keys. Since miners are accustomed to the regular blockchain regulations, it is simpler for them to understand the new ones.  

The new guidelines that will validate a block in the chain must be followed by all miners. This means that miners and investors need to be informed that the protocol has been changed. By then, they can keep track of the updates that will be launched by the creators of the hard forks. 

How and why were they created? 

There are several reasons why people thought of forking Bitcoin. One of them is to fix security flaws that exist in earlier software versions. It might also be to reverse transactions or create new functions.

Forks are often carried out to give a blockchain new features or functions. Bitcoin has already undergone several splits since it was first released in 2009. This was because Bitcoin was designed to be developed over time and was made available as open-source code. Its decentralised nature and blockchain structure also made it possible to create Bitcoin forks.

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Popular Bitcoin hard forks 

As stated, there are already several Bitcoin hard forks that were created and they continue to be relevant in terms of crypto trends. If you aren’t sure whether or not you have already encountered some of them, here are some of the coins you may come across:  

Bitcoin XT 

One of the first prominent hard forks of BTC was Bitcoin XT. This was released in late 2014 by Mike Hearn who proposed several new features. Bitcoin XT aims to complete 24 transactions per second (TPS) as opposed to the previous version of BTC's 7 TPS maximum. It suggested raising the block size from one megabyte to eight megabytes to achieve this.

In the late summer of 2015, Bitcoin XT experienced its first wave of success with more than 1,000 nodes running its software. However, it was a short time later that people' excitement died down and they virtually stopped using the project. Since its original website is no longer active, Bitcoin XT is no longer accessible.

Bitcoin Cash 

Despite having the word ‘Bitcoin’ in its name, BCH is different from the original. The developers have promised to improve BTC's current features, especially its block size. BCH's block size can support up to 8MB of transactions, as opposed to 1MB for BTC. Transactions are also faster since it can verify several entries simultaneously.

This asset is also recognized for being one of the most successful hard forks. In fact, it even got recognized as the eleventh-largest digital currency in terms of market cap in 2021. 

Bitcoin Classic

After the downfall of Bitcoin XT, some community members continued to call for larger block sizes. In early 2016, a group of programmers launched Bitcoin Classic in response to the issue. Bitcoin Classic wanted to extend the block size to only two megabytes, in contrast to XT, which suggested raising it to eight megabytes.

The initial interest in Bitcoin Classic was similar to that of Bitcoin XT, with over 2,000 nodes active for a period of time in 2016. This project is still ongoing and as many developers believe in its potential. The positive impact it gets also paves the way for several other possibilities in the BTC community. 

Bitcoin SV

What sets Bitcoin SV apart from other hard forks is that it is hard forked from Bitcoin Cash. It aims to maintain the stability and huge scalability of the original Bitcoin protocol as laid out by Satoshi Nakamoto in version 0.1 of the cryptocurrency.

Leading Bitcoin SV uses nChain which is a technological startup engaged in research and development that creates tools, protocols, and applications to support the expansion of the blockchain industry worldwide. Its creator is Australian computer scientist, Craig Wright, who has drawn criticism for making repeated claims that he is Satoshi Nakamoto even though it has already been debunked. 

Bitcoin Gold 

As a Bitcoin hard fork in 2017, Hang Yin and Alejandro Regojo developed BTG. They were able to develop a successful cryptocurrency that provided remedies to BTC's difficult mining process. 

Since it doesn’t need application-specific integrated circuits (ASICs) or any other specialised equipment, regular users of this wouldn't have to worry about mining. The developers also switched from the Proof of Work (PoW) algorithm to SHA-256 and then to Equihash. As a result, graphic processors—which are far more widely available than ASICs—will suffice for mining equipment.

Bitcoin Unlimited 

Since its launch in 2016, Bitcoin Unlimited has remained somewhat mysterious. The source for the project was released but the forking strategy was not made clear by the developers. With nodes and miners restricting the amount of blocks they accept of up to 16 megabytes, Bitcoin Unlimited stood out by allowing miners to choose the size of their blocks.

Though it may have sounded well in the market, this asset failed to be widely accepted by investors. 

Segregated Witness

Segregated Witness (SegWit) was first proposed by Bitcoin Core developer Pieter Wuille in 2015. It attempts to make Bitcoin transactions cheaper and increase block size so that more transactions can happen simultaneously. Technically, SegWit was a soft fork. But after it was first suggested, it has been a propelling force for the rise of hard forks.

SegWit2x

When SegWit was introduced in August 2017, programmers had a second part of the protocol improvement in mind. The SegWit2x feature would cause a hard fork that mandated a block size of two megabytes.

A hard fork for SegWit2x was planned for November 2017. Nevertheless, several businesses and members of the bitcoin community who had initially supported the SegWit protocol chose to abandon it in the second part. 

Part of the reason as to why it may have received some backlash is that it has chosen to include opt-in replay protection. This move had a significant influence on the kinds of transactions that the new fork would have accepted. True enough, it was one of the driving factors that led to its stoppage. 

Most asked questions about hard forks 

Now that you know more about these interesting hard forks, here are other questions you may be interested to have answered: 

  • Are hard forks good or bad?

It depends. Hard forks can have a great impact on Bitcoin that can either be positive or negative, it just depends on what aspect you will be looking at. 

  • What sets hard forks apart from soft forks?

A soft fork is an upgrade to the software that is backward-compatible. It’s accepted by validators as an earlier version of the chain. Meanwhile, a hard fork effectively results in a permanent chain separation because the previous version is no longer compatible with the new one.

  • When was the first Bitcoin fork made?

The first BTC fork was Bitcoin XT which was released in 2014. 

These are just some facts that you have to learn more about Bitcoin hard forks and what they are all about. By learning more about them, you’ll be familiar when you see them on your favourite crypto betting sites and can easily use them to deposit more funds.  

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