Bitcoin, the most popular cryptocurrency in the world, has experienced several forks since its creation in 2009. If you’re not familiar with the concept of forks, they occur when a group of developers decide to make changes to the underlying code of a cryptocurrency, creating a new version of the blockchain.
These changes can be minor or major, and result in the creation of a new cryptocurrency that shares a common history with the original blockchain up until the fork. Bitcoin has had numerous forks over the years, with some of the most well-known being Bitcoin Cash, Bitcoin Gold, and Bitcoin SV.
Bitcoin Cash, which was created in 2017, was the first major fork of Bitcoin. It was designed to increase the block size limit, allowing for more transactions to be processed at once. Bitcoin Gold, created later that year, aimed to make mining more accessible by changing the algorithm used to mine the cryptocurrency.
Bitcoin SV, short for Bitcoin Satoshi Vision, was created in 2018 as a result of a factional dispute within the Bitcoin Cash community. It sought to restore what its creators saw as the original vision of Bitcoin and increase the block size even further.
These forks have resulted in the creation of new cryptocurrencies that have gained their own communities and supporters. While they share a common history with Bitcoin, they have diverged in terms of their underlying technology and goals. As Bitcoin continues to evolve, it’s likely that we will see more forks in the future.
What are bitcoin forks?
Bitcoin forks are fundamental changes to the Bitcoin protocol that result in the creation of a new blockchain and cryptocurrency. Forks occur when developers and miners in the Bitcoin community cannot agree on proposed changes or updates to the protocol.
There are two types of forks: hard forks and soft forks.
A hard fork is a permanent divergence in the blockchain, where the new protocol is not compatible with the old protocol. This creates a separate chain and a new cryptocurrency. Hard forks require all participants in the network to upgrade their software to continue participation.
On the other hand, a soft fork is a backward-compatible upgrade to the protocol. It introduces new rules or features that are compatible with the existing network. Users who haven’t upgraded their software can still participate in the network but may not benefit from the new functionalities.
Forks can be initiated by different community members or groups, including developers, miners, or users with different visions for the future of Bitcoin. Some forks aim to improve scalability, privacy, or security, while others may be motivated by ideological or political differences within the community.
Bitcoin forks have led to the creation of various alternative cryptocurrencies, such as Bitcoin Cash, Bitcoin SV, and Bitcoin Gold. Each fork has its own unique characteristics and objectives, catering to different preferences and priorities within the cryptocurrency community.
Overall, Bitcoin forks play a significant role in shaping the evolution of the cryptocurrency ecosystem, contributing to its diversity and providing choices for users and investors.
Types of Bitcoin Forks
In the world of cryptocurrencies, a fork refers to a split in the blockchain network, resulting in two separate chains with different rule sets. Bitcoin has experienced several forks throughout its history, each with its own unique characteristics and motivations. Here are some of the most notable types of Bitcoin forks:
1. Hard Forks
A hard fork occurs when there is a permanent divergence in the blockchain, resulting in two separate chains. This type of fork requires all participants to upgrade their software to continue transacting on the new chain. Hard forks can introduce significant changes to the protocol, such as altering the block size or implementing new features.
2. Soft Forks
Unlike hard forks, soft forks are backward-compatible, meaning that participants who haven’t upgraded their software can still transact on the new chain. Soft forks typically introduce minor changes to the protocol, such as fixing bugs or tightening rules without requiring the majority to upgrade their software.
3. Chain Splits
A chain split occurs when the blockchain network separates temporarily due to a disagreement among participants. This can happen if a significant portion of the network diverges from the main chain and creates their own separate chain. Chain splits are usually resolved when the majority of participants converge back to the main chain, leaving the minority chain with limited support.
4. Spin-off Coins
Spin-off coins, also known as airdrops or dividend forks, are created when a new cryptocurrency is generated from an existing blockchain. This typically happens when a community decides to split from the main chain and develop their own independent project. Holders of the original cryptocurrency may receive the new spin-off coins based on their existing holdings.
5. User-Activated Forks
User-activated forks occur when a particular group of users, often driven by differences in ideology or vision, initiate a fork in the blockchain. This type of fork usually requires community support and coordination to gain traction. User-activated forks can result in the creation of a new cryptocurrency or a modified version of the existing one.
| Types of Bitcoin Forks | Description |
|---|---|
| Hard Forks | Permanent split in the blockchain network, requiring software upgrade |
| Soft Forks | Backward-compatible changes to the blockchain protocol |
| Chain Splits | Temporary separation of the blockchain due to disagreement |
| Spin-off Coins | New cryptocurrency generated from an existing blockchain |
| User-Activated Forks | Forks initiated by specific user groups based on their vision |
Main Bitcoin Forks
Bitcoin, the groundbreaking decentralized cryptocurrency, has undergone several forks throughout its history. These forks have resulted in the creation of new cryptocurrencies, each with its own unique features and characteristics.
1. Bitcoin Cash (BCH)
Bitcoin Cash was created on August 1, 2017, as a result of a hard fork from the original Bitcoin blockchain. The main difference between Bitcoin Cash and Bitcoin is an increased block size limit, allowing for faster and more affordable transactions.
2. Bitcoin SV (BSV)
Bitcoin SV emerged in November 2018 as a result of a contentious hard fork from Bitcoin Cash. The aim of Bitcoin SV is to restore the original vision of Bitcoin by increasing the block size limit even further and emphasizing scalability.
3. Bitcoin Gold (BTG)
Bitcoin Gold originated from a hard fork on October 24, 2017, with the goal of making mining more accessible to a wider range of participants. The project aimed to decentralize the mining process by utilizing graphics processing units (GPUs) instead of specialized hardware.
These are some of the main forks that have occurred in the Bitcoin ecosystem. It is important to note that each fork has its own unique qualities and may have varying levels of support and adoption within the cryptocurrency community.
Bitcoin Cash
Bitcoin Cash (BCH) is a cryptocurrency that was created as a result of a hard fork from the original Bitcoin blockchain in August 2017. The main motivation behind the creation of Bitcoin Cash was to increase the block size limit of Bitcoin, which would allow for more transactions to be processed in each block.
The block size limit of Bitcoin was originally set at 1 megabyte (MB), and this limit was seen as a constraint on the scalability and efficiency of the network. Bitcoin Cash increased the block size limit to 8 MB, and later to 32 MB, enabling faster transaction processing times and lower fees.
Key Features of Bitcoin Cash:
Larger Block Size: Bitcoin Cash has a larger block size limit than Bitcoin, allowing for more transactions to be processed in each block. This results in faster transaction confirmation times and helps to reduce congestion on the network.
Low Transaction Fees: With the larger block size, Bitcoin Cash can handle more transactions per second, resulting in lower fees for users. This makes Bitcoin Cash an attractive option for everyday transactions and microtransactions.
Comparison with Bitcoin:
While Bitcoin and Bitcoin Cash share a common history and are based on the same underlying technology, there are some key differences between the two cryptocurrencies.
| Bitcoin | Bitcoin Cash |
|---|---|
| 1 MB block size limit | 8 MB (later increased to 32 MB) block size limit |
| Higher transaction fees | Lower transaction fees |
| Slower transaction confirmation times | Faster transaction confirmation times |
In summary, Bitcoin Cash was created to address the scalability issues of the original Bitcoin blockchain by increasing the block size limit. This allows for faster transaction processing and lower fees, making Bitcoin Cash a viable option for everyday transactions.
Bitcoin SV
Bitcoin SV (Satoshi Vision) is a fork of Bitcoin Cash that was created in November 2018. It was led by entrepreneur Craig Wright, who claims to be the creator of Bitcoin, Satoshi Nakamoto. Bitcoin SV’s main goal is to restore the original vision for Bitcoin as outlined in the Bitcoin whitepaper.
One of the key differences between Bitcoin SV and other forks is its emphasis on scalability. Bitcoin SV aims to achieve massive on-chain scaling, allowing for large blocks and increased transaction throughput. This is in contrast to other forks that rely on off-chain solutions like the Lightning Network for scalability.
Key Features of Bitcoin SV:
1. Increased Block Size: Bitcoin SV supports block sizes of up to 128MB, which is significantly larger than the original Bitcoin and other forks. This allows for more transactions to be processed in each block, increasing the network’s transaction capacity.
2. OP_RETURN Data: Bitcoin SV removes the limitation on the size of data that can be stored in the OP_RETURN field of a transaction. This enables developers and businesses to store more information on the blockchain, opening up possibilities for various applications and use cases.
3. Restoring Original Bitcoin Script: Bitcoin SV aims to restore the original Bitcoin script language, enabling advanced smart contracts and applications to be built directly on the Bitcoin blockchain.
4. Replay Protection: Bitcoin SV introduced replay protection to safeguard users’ transactions in the event of future forks or network splits. This helps ensure that transactions made on one chain are not valid on another.
Controversies:
Bitcoin SV has been marred by controversies since its inception. Its leader, Craig Wright, has been involved in numerous legal battles and has made several controversial claims, including his assertion that he is the real Satoshi Nakamoto. Additionally, Bitcoin SV has faced criticism from the wider cryptocurrency community, with many questioning its technical capabilities and development team.
Despite the controversies, Bitcoin SV continues to have a dedicated following and a separate blockchain, making it one of the forks of Bitcoin with its own distinct features and community.
Less known bitcoin forks
While Bitcoin is the most well-known and widely used cryptocurrency, there are several lesser-known forks of Bitcoin that have emerged over the years. These forks have often been created with the aim of improving upon Bitcoin’s technology or addressing specific issues within the original Bitcoin protocol.
Bitcoin Cash
Bitcoin Cash (BCH) is one of the most significant Bitcoin forks and was created in 2017. It was designed to address some scalability issues that Bitcoin faced and increase the block size limit from 1MB to 8MB, allowing for more transactions to be processed per block. Bitcoin Cash has gained a significant following and is supported by various crypto exchanges and wallets.
Bitcoin Gold
Bitcoin Gold (BTG) is another fork that was created in 2017. It aimed to decentralize the mining process by using a different hashing algorithm, known as Equihash, which made it more resistant to specialized mining hardware called ASICs. Bitcoin Gold’s goal was to make mining accessible to a wider range of people and prevent centralization of mining power.
Other lesser-known Bitcoin forks include:
- Bitcoin Diamond (BCD) – Created in 2017, it aimed to improve transaction speed and reduce transaction fees.
- Bitcoin Private (BTCP) – Introduced in 2018, it focused on privacy features such as shielded transactions.
- Bitcoin SV (BSV) – Formed in 2018 as a result of a contentious hard fork, it aimed to restore what its supporters saw as the original vision of Bitcoin.
While these forks may not have gained the same level of recognition and adoption as Bitcoin, they showcase the ongoing innovation and experimentation within the cryptocurrency space.
Bitcoin Gold
Bitcoin Gold (BTG) is a fork of Bitcoin that was created in October 2017. Its main goal is to make mining more decentralized by allowing individuals to mine Bitcoin Gold with their home computers, rather than needing specialized mining equipment.
Bitcoin Gold uses Equihash as its mining algorithm, which is different from the SHA-256 algorithm used by Bitcoin. This change was implemented to make mining more accessible to a wider range of people.
One of the main differences between Bitcoin and Bitcoin Gold is the way they handle mining. Bitcoin uses the Proof-of-Work (PoW) consensus algorithm, while Bitcoin Gold uses a different version called Equihash PoW. This change was made to prevent mining centralization and give more power to individual miners.
Bitcoin Gold also implemented replay protection, which ensures that transactions made on one chain are not valid on the other chain. This made it easier for users to safely transact on the Bitcoin Gold network without worrying about their transactions being replayed on the Bitcoin network.
Overall, Bitcoin Gold aims to provide a more democratic and accessible mining experience for individuals, while still maintaining the core principles of Bitcoin.
Bitcoin Diamond
Bitcoin Diamond (BCD) is a fork of Bitcoin that was created to solve some of the scalability and privacy issues faced by Bitcoin. It was launched on November 24, 2017, and aims to enhance the overall performance of the Bitcoin network.
Key Features
Bitcoin Diamond implements several key features that differentiate it from Bitcoin:
- Increased Block Size: Bitcoin Diamond increased the block size from 1MB to 8MB. This allows for more transactions to be processed in each block, resulting in faster confirmation times and lower fees.
- Enhanced Privacy: Bitcoin Diamond uses an improved version of the encryption algorithm used by Bitcoin, which provides better privacy and security for its users.
- Lower Transaction Fees: With the larger block size, Bitcoin Diamond aims to reduce transaction fees compared to Bitcoin.
- SegWit Integration: Bitcoin Diamond has integrated the Segregated Witness (SegWit) technology, which optimizes the use of block space and increases the capacity of the Bitcoin Diamond network.
- ASIC Resistant: Bitcoin Diamond implemented the Equihash algorithm, making it resistant to ASIC mining. This allows for more decentralized mining and a fairer distribution of rewards.
Wallet Support
Bitcoin Diamond is supported by a wide range of wallets, including hardware wallets like Ledger and Trezor, as well as software wallets like Coinomi and BitPie.
It’s important to note that Bitcoin Diamond is a separate cryptocurrency from Bitcoin and has its own blockchain. Therefore, if you wish to transact with Bitcoin Diamond, you need to use a wallet that supports it.
Overall, Bitcoin Diamond aims to provide a faster, more secure, and more private alternative to Bitcoin. While it shares its name with Bitcoin, it is a separate cryptocurrency with its own unique features and goals.
