A Beginner's Guide to Hard and Soft Forks in Blockchain

A fork is a change in protocol causing the creation of an alternative chain. There are two main types of forks that can occur on a blockchain network: a hard fork and a soft fork.

Hard Fork

A hard fork is a type of fork that occurs when the underlying blockchain network splits into two separate networks that are incompatible with each other. This typically happens when a significant number of participants in the network disagree with the current rules governing the network and decide to create a new network with a different set of rules. When a hard fork occurs, the new network is not backward-compatible with the original network, meaning that transactions and blocks on the new network are not recognized by the original network, and vice versa.

One example of a hard fork in the Ethereum blockchain network was the Byzantium hard fork, which occurred in October 2017. This hard fork was the first part of a two-part network upgrade called Metropolis, and it introduced several new features and improvements to the Ethereum network, such as improved transaction processing speed and privacy.

The Byzantium hard fork was a contentious issue among some members of the Ethereum community, and it led to the creation of a new blockchain network called Ethereum Classic. This new network was a continuation of the original Ethereum blockchain, without the changes introduced by the Byzantium hard fork. As a result, Ethereum Classic and Ethereum are now two separate and incompatible blockchain networks.

Soft Fork

A soft fork, on the other hand, is a type of fork that occurs when the underlying blockchain network splits into two networks that are still compatible with each other. This typically happens when a small number of participants in the network propose changes to the network's rules that are backwards-compatible with the existing rules. In other words, transactions and blocks on the new network are still recognized by the original network, but the new network may have additional rules and features that are not present on the original network.

The Muir Glacier soft fork that occurred in January 2020 was designed to gradually increase the difficulty of mining new blocks and eventually force the network to switch from proof-of-work (PoW) to proof-of-stake (PoS) consensus. It delayed the effects of the difficulty bomb by approximately four million blocks, allowing the Ethereum network to continue using PoW consensus for a longer period of time. This soft fork was implemented through a network upgrade that was backwards-compatible with the existing Ethereum network, meaning that nodes that did not upgrade to the new version of the software could still participate in the network and process transactions.

Overall, the Muir Glacier soft fork is an example of how a network upgrade can be implemented in a way that maintains compatibility with the existing network, allowing the network to continue operating without causing a split.