Bitcoin, over the years, has been modified to the point that various forks have been created to the original BTC chain, which originates from the transformation of the protocol, where employing a consensus approval of the creation is given of a new fork of the leading digital currency. In actuality, the receiver and the sender determine the value and purchasing power of bitcoins (Crypto Genius platform).
Depending on the characteristics and impact of the changes, the type of fork could be determined.
What does a soft or hard fork refer to?
Blockchain is not only the technology that allows many users to join the cryptocurrency market but the rules codified in the protocols that allow security and trust in transactions.
These rules allow the verification that the operations that make up the block are correct for their subsequent validation.
Sometimes consensus rules can be modified to add updates or protect the network from attacks, or they can be changed for specific purposes, such as giving birth to a new cryptocurrency. Regardless of the reason for the modification, there are two ways to change the rules: by soft fork or hard fork.
A soft fork refers to transformations in the protocol that change the approval rules and may or may not be accepted by network participants without implying a split into two or more parts of the original chain.
On the other hand, a hard fork refers to protocol changes that make outdated software “illegal.”
It means that if they are not approved, even if it is a minimum part of the participants in the network, that is, they do not have the consensus of the majority, and since they are not compatible with maintaining a single chain referred to the one that updated the software and not, which causes the chain to fork, creating a new one from a particular point in the main chain.
In both soft forks and hard forks, users must participate in upgrading the network, either by downloading new software and starting upgraded nodes or by refraining from doing so if they choose to do so.
The popularity of Bitcoin allows its diversification
Bitcoin (BTC ) has been the most popular cryptocurrency of its time. However, it has its challenges. BTC transactions have been notoriously slow to process and have gotten more expensive over time.
BTC blocks have been limited in size, allowing only around 2-3 trades to be executed per second. Also, while the mining process is limited, the minimum block size has been increased to 8MB; this will help improve transaction processing, and blocks will be created up to five times faster.
The cost of BTC transactions has been increasing, which has eclipsed its practical applications.
The Bitcoin Diamond was forked from the original bitcoin on November 24, 2017. The mainnet was upgraded in December 2017, and only in the third quarter of 2018 was it available on the market.
Bitcoin Diamond ( BCD ) is a fork that takes the existing bitcoin infrastructure and improves it to support more advanced privacy features and a new currency.
The creators of Bitcoin Diamond remain anonymous with the coin boost advised by the Bitcoin Diamond foundation. However, they did not get any offers for these coins even at the time of their creation. Instead, bitcoin users at the time of the fork instantly became owners of the innovative BCD coins and received 10 BCD for every BTC they held.
There are only 1000 blocks to mine with the PoW component. Mining hopes to be the way to remove the remaining blocks, which undoubtedly contributes to users generating interest by having their cryptocurrencies in their wallets.
BCD is considered a hard fork since its creators were looking for three specific characteristics that would improve the conditions of the original BTC and, in turn, attract new followers who felt identified and attracted to the new fork; these characteristics were the following:
- transaction times _ plus rapid
- Transaction fees _ plus low
- Motivation for new users
In turn, Bitcoin Diamond wants to have faster, cheaper, and simpler access than Bitcoin and hopes to achieve this by having a larger block size, having a higher total supply than bitcoin, and, finally, easier mining.