Fork

Key points

• A fork is a split in a blockchain's history, caused by a change in the protocol rules that participants follow.
• A soft fork is compatible with the old rules, while a hard fork creates a division that can give rise to a new network and a new asset.
• Because there is no central authority, meaningful changes depend on participants agreeing to adopt the new rules.

What is a fork?

A fork is what happens when part of the network starts following rules that differ from the previous ones. Since a blockchain is maintained by many independent participants, changing the protocol requires them to update their software. Depending on how this change is made, the history can remain unified or split into two distinct paths.

How it works

There are two main types. In a soft fork, the new rules are stricter and compatible with the old ones, so nodes that haven't updated still recognize the valid blocks. The network remains unified, just with tighter rules. It's a way to evolve the protocol without splitting the community.

In a hard fork, the new rules are incompatible with the old ones. Those who update start following one set of rules; those who don't update follow another. If both groups persist, the chain splits into two separate networks, each with its own history from the point of divergence, and holders of the original asset end up with units on both.

Forks can also be temporary and accidental, when two valid blocks appear almost simultaneously. In this case, the network naturally converges on the chain that accumulates more work or validation, and the other block is discarded.

Why it matters

Forks are the mechanism through which ownerless protocols evolve or split. For someone holding an asset, a hard fork can create a new asset and change important rules. For a company integrating with a network, tracking planned forks is essential, because they can change fees, compatibility, and contract behavior.

Risks and limitations

Hard forks can split communities and liquidity, weakening both resulting networks. They also create room for confusion and for scams that exploit the moment of the split. Coordinating a rule change without central authority is difficult, and prolonged disagreements can create uncertainty about which chain will remain relevant. For this reason, planned forks are usually announced in advance so services and users can prepare.