You’ve heard about Bitcoin. What is Bitcoin Forks?

Published in

The Capital

3 min readJun 3, 2023

Bitcoin forks are a relatively new phenomenon in the world of cryptocurrency. They’re not that complicated, but they can be pretty confusing for newcomers to the space.

I’m going to walk you through what bitcoin forks are and how they work so you’ll have a better understanding of them.

Bitcoin Forks: What are They?

A bitcoin fork is a change to the protocol of the bitcoin network. It happens when developers propose changes that deviate from the current consensus rules, and those changes take place at specific block heights on the chain as long as enough miners agree with them. These changes can be activated after certain waiting periods because once they’ve been implemented, it’s impossible to go back — these aren’t like updates you download for your computer or mobile device.

If there isn’t unanimous agreement among all miners, then forks can lead to multiple versions of bitcoin coexisting in different forms online called “forks.” In other words, this means you could have two separate digital assets both claiming to be legitimate versions of the original bitcoin.

When do they occur?

They usually occur when there’s a change made to the code of Bitcoin or itself, developers need time to fix their product before updating everyone else using said technology across networks and exchanges globally — which could lead to more problems with its software. However, this is rather subjective as not all changes cause coins on other chains.

What we do know is that after certain events such as hacks or technical issues with BTC itself, developers need time to fix their product before updating everyone else using said technology across networks and exchanges globally — which could lead to more problems if done too quickly.

Temporary or Permanent Fork

These forks result in a new cryptocurrency being created and having its ownership distributed to existing Bitcoin owners. Forks can be temporary or permanent, depending on how they are implemented.

In a temporary fork, the original cryptocurrency remains intact while the newly-created coin is simply added on top of it. A permanent or hard fork results in splitting off from an existing blockchain to start a new one with different rules and features.

An example of a Bitcoin Fork

Here’s an example of just such a fork that took place in August 2017 — Bitcoin cash came into existence in August 2017 first after “miners” moved over from the original blockchain protocol by way of hard-fork. The resulting new coin was named Bitcoin Cash because miners had to split the blockchain and move over to the new platform. Everyone who had bitcoin before this date received an equal amount of Bitcoin Cash.

Now we can see why forks aren’t all bad news after all. They may be perceived as “bad,” especially when they happen without warning or good reason (or both), but these days forks have been used to create really interesting changes in cryptocurrencies like bitcoin.

Final Thoughts

As you can see, Bitcoin Forks are important and will continue to be as long as there is blockchain. Let’s take a look at some other forks that were created from the bitcoin network: BCash (BCH), Goldcoin (GLD), DigiByte (DGB). You may have seen these digital currencies in your research or perhaps even used them yourself!

They exist because of hard/binary division off of an original codebase — which means they share a history with their parent chain- but it does not mean they hold any value out on their own. The only way for a fork cryptocurrency to succeed would be if people believed in its potential by mining it or using it instead of selling it right away.