Soft fork vs. Hard fork: A Detailed Comparison

• Blockchain Council
• October 12, 2022

With the continuous technological advancements, most software users are aware of the constant maintenance and upgrades required to improve the efficiency of their programs. So you apparently wouldn’t ignore it when your device’s digital banking application notifies you to update it. On the other hand, perhaps your smartphone upgrades on its own as soon as it gets network connectivity. And anyway, if you don’t download the upgraded version of the program, you might face functionality issues and risk losing access to its services.

The blockchain platform is based on the very same updates and improvements mechanism. However, decentralized applications, including cryptocurrencies on a blockchain platform, need a separate, more complex methodology, whereas centralized network operators may quickly upgrade their software with innovative elements at the press of a button.

Blockchains, for example, are decentralized open-source systems with no centralized power. As a result, the option to update the system involves the agreement of all users in the network. A fork is considered a unique method of updating or improving a blockchain. Based on their function, forks are classified into two categories: soft and hard forks.

But first, let’s define what it is to have a blockchain fork and understand the differences between a soft fork and a hard fork.

Understanding Blockchain Forks 

At the most beginner level, a blockchain is a collection of data blocks linked together by safe cryptographic keys to build a chain of blocks stretching all the way back to the first one.

Therefore, it leads the blockchain visualization as a straight road formed up of interconnected blocks. Since the blocks are linked by an agreement that all of the blocks accept, each optimization to the system necessitates a modification in consensus across the blocks. However, since the blocks are linked through a practically unalterable set of protocols, the chances of reaching such a consensus are nearly impossible.

Therefore, rather than recreating each block, forks are frequently used to make modifications to a blockchain. A fork is an event on the blockchain platform in which the initial programming is copied, and the relevant modifications are made to it. Moreover, two blockchain platforms can’t coexist; therefore, the new blockchain separates into two branches, generating a fork-like deflection from the primary blockchain.

Who Determines a Fork Formation?

According to blockchain experts, since there is no centralized entity running the blockchain, it is up to the platform’s members to decide on a path ahead and make modifications that enhance overall system functionality and efficiency.

Diverse groups of participants, varying from miners, and investors to full node developers, are different components in blockchains. So, who has the final rights on what system improvements must be put in place? In addition, certain members have greater electoral power than others since each subgroup provides significantly to the system.

Miners, for example, that safeguard the system by allocating computing resources for block validation are likely to decide the fork versions’ integrity and popularity. Since miners will provide the computing resources required to maintain the system, any fork version that the miners approve is likely to prevail. Most open-source blockchains enable overlapping of duties and, as a result, a shared authority on fork formation procedure. Other subset jobs comprise developers, who develop and optimize the blockchain’s technology underlying coding script, and full node consumers, who serve as the platform’s core and auditors, validating and maintaining the blockchain’s record.

What is a Hard Fork?

Forks are modifications to the blockchain’s network algorithm that leads to the primary blockchain network to split. If there is a scenario where an old blockchain network has crypto working on it, a fork on that blockchain will lead to the formation of a parallel token on the newly forked blockchain network.

The regulations of the blockchain rules are upgraded or altered in a hard fork, creating the previous blockchain and the updated blockchain incompatible with each other.

This implies that the previous nodes will deny the recently upgraded blocks, and the newer blockchain will run under fresh guidelines that will continuously deny blocks from the old blockchain indefinitely. A “backward-incompatible” software update, this methodology is commonly referred to as.

For instance, a hard fork was developed on the Bitcoin blockchain network because of disapproval among the Bitcoin community over the optimal way of scaling the blockchain network. Individuals who sought to expand the block size were at one edge of the discussion. However, on the other side, edge the community members that were against such changes. Those who wished to develop the block size went to the Bitcoin Cash fork, whereas those who didn’t want to upgrade stayed on the original Bitcoin network. Therefore, even though both currencies (Bitcoin and Bitcoin Cash) work on separate blockchains, their histories are identical before the fork.

What is a Soft Fork?

A hard fork is a backward-incompatible upgrade to the blockchain, whereas a soft fork is a rule modification that is forward-compatible. The old blockchain will keep accepting blocks from the new advanced blockchain platform since the fork is a forward-compatible alteration, although the regulations have been modified due to the new upgrade.

Broadly said, a soft fork convinces the old blockchain network to accept the altered rules, thus allowing both the upgraded and old blocks of transactions to be accepted at the same moment.

A soft fork, unlike a hard fork, keeps the old blockchain alive by retaining two lanes with separate regulations and standards. The Segregated Witness (SegWit) Bitcoin protocol upgrade 2015 is an example of the successful implementation of a soft fork.

Before the SegWit upgrade, the Bitcoin system was somewhat more expensive ($30 per transaction) and time-consuming. In addition, signature information makes up roughly 65 percent of a transactional block, according to the developers of the SegWit upgrade. As a result, SegWit advocated that the effective block size be increased from 1MB to 4MB.

The objective of this improvement was to divide or eliminate signature information from transactional data records on each block of the blockchain, clearing space for increased transactional productivity per block. The previous Bitcoin blockchain was ready to embrace fresh 4MB and 1MB blocks simultaneously after the implementation of a soft fork.

The soft fork allowed the old nodes to validate the new blocks as well, thanks to a smart engineering approach that structured new rules without violating the old ones.

Difference between Hard Fork and Soft Fork

The blockchain and cryptocurrency communities are split on which form of the fork is preferable for improving blockchain networks. Although each sort of fork offers advantages, the communities are much more engaged about the disadvantages and hence split over them.

Soft forks are the milder of the two, but they carry their own set of risks. The most obvious of these dangers is that corrupt individuals can operate a soft fork to deceive full-node consumers and miners into confirming transactions that violate the blockchain’s regulations.

Full-node consumers operate as the blockchain network’s auditors, always preserving an entire copy of the blockchain network at all times. The responsibility lies with them to guarantee that each new block follows the policies of the earlier blockchain network. The network’s trustworthiness can be jeopardized if a set of individuals on the Blockchain attempts to set new regulations without bringing it to the knowledge of the platform’s full node participants.

Bitcoin, for example, maintains its decentralized character by having full-node customers and miners that work individually with others and verify the ledger’s authenticity. This is how important economic rules like double-spending prevention and Blockchain’s inflation formula are strengthened. However, if unscrupulous operators convince full-node consumers and miners to approve blocks that break the regulations, the blockchain may begin accepting erroneous blocks, resulting in the platform’s failure. Thus, blockchain platforms have tried to reduce this risk by ensuring all soft forks are publicly accessible.

Apart from this, hard forks also lead to their own areas of concern. Firstly, hard forks are known for segregating communities. This is because a hard fork, unlike a soft fork, has no middle ground. Secondly, many suggest that hard forks are harmful as they split the platform’s hashing power, reducing the site’s overall trustworthiness as well as overall processing capabilities.

Which One Is More Beneficial: Soft Fork or Hard Fork?

Cryptocurrency exchanges and other business networks claim that hard and soft forks have distinct purposes. Although contentious hard forks can cause division in the community, but intelligent and well-planned ones may also result in software changes that everybody stamps on.

Hard forks are replaced by soft forks, which are more kind and diplomatic. If the modifications are written in such a manner that they do not clash with current regulations, there is no need to be concerned about fragmentation.

Transformation of Blockchains

Whatever form of the split is used, it is evident that significant work has to be accomplished to enable a smooth transfer of blockchain maintenance and upgrades. Most blockchain miners and traders select hard forks as it reduces the danger of approving or mining invalid blocks.

Hard forks guarantee that miners and traders on the blockchain are not left behind or deceived, particularly while they operate. Although, hard forks utilize a lot of computing resources and are seen to be harmful to the growth of digital currencies.

Soft forks, amidst their increasing uncertainty, provide a significantly speedier alternative to blockchain software upgrades without consuming additional processing resources. Soft forks are often praised for their ability to roll out upgrades without causing a social rift.

Conclusion

Any program or software, like every blockchain network, requires upgrades in order for the software to serve larger and greater objectives. Hard forks and soft forks allow us to make decentralized software changes without the interference of a central authority. Without forks, networks would be unable to adopt new features, necessitating the use of a centralized system for total control.

If you want to dive deeper into the crypto realm and know everything there is to know about, then you have landed at the right spot. Blockchain Council some of the best blockchain certification courses according to the current industry standards. These courses are extensively designed to provide the learners with theoretical as well as blockchain technology training. Apart from this, these courses are pocket-friendly too. You need to simply pick up the one that best suits your requirements.