There has been imperative report analysis and developments in past weeks about changes to digital currency networks. These are also called “forks”.
Here is the simple, non-technical detail to add context to recent discussions
What is a “fork”?
A “fork” is a change to the software of the digital currency that creates two separate versions. It is of the blockchain with a shared history.
Forks can be provisional, lasting for a short time, or it can be perpetual split in which creating two separate network versions of the blockchain. When this is executing, two different currencies are also generates.
Why do forks happen?
There are petty valid reasons why a fork can happen. For instance, whenever there is change in a digital currency protocol, users should always ready to support for the new version and upgrade.
People have to agree for these changes, similarly just as changes to cellphone networks require many phone companies to agree.
Difference between a “hard” fork and a “soft” fork
“Hard” fork is one of the major problems with the people, because separating the currency could wreak havoc on its soaring value.
Backward compatibility is the huge difference between these two forks.
A “soft” fork is a significant change or update to the technology that is still compatible with traditional versions of the code.
In this blockchain temporarily splits, but the new “blocks”, the building units of the chain still recognize the old ones as valid.
However, “hard” fork changes the protocol so significantly that the new blocks no longer recognize the old data as valid.
They are not compatible, since the two chains, or ways of recoding currency, run simultaneously to one another, but can’t swap data back and forth.
Monitoring the fork
How you will decide that Bitcoin has forked, or not?
Btcforkmonitor.info is one of the popular website tracking potential Bitcoin forks. If it recognizes the fork, a red notification promises to pop up at the top of the website.
Developers of the website are using both Bitcoin ABC and Bitcoin Cores nodes. So, that they can able to compare the two clients and observe how many blocks are on one chain versus the other.
Still Bitcoin Fork monitor is an autonomous website, one cannot assure that the information may or may not be accurate. So, unless you want to own 150 GB Bitcoin ABC full nodes. It might be a good perception to verify with other sources.
Digital currency stored on Coinbase
Coinbase actively oversees protocol developments and perform work truly to ensure customer funds are safe in these events.
The main intention is to support only one version of a digital currency. Factors such as size of the network, market value and customer demand are adopted to determine fork to support, such as other people running full nodes, and track their updates on social media.