In fact, the concept of hard bifurcation is not new in the blockchain industry. On August 1 day, 2065438, bitcoin cash became the first hard fork in the history of bitcoin blockchain. Since then, bitcoin forking incidents have become more and more frequent, and a series of forked coins have begun to appear, such as bitcoin candy, bitcoin pizza and bitcoin diamonds.
Why use a fork?
The reason why bitcoin bifurcates is because the underlying technology of bitcoin is blockchain, and blockchain has the characteristics of decentralization, which leads to bitcoin being maintained by a group of people. At first, Satoshi Nakamoto probably invented Bitcoin just to give people a freer way to trade money, but with more people understanding and using Bitcoin, people's ideas and demands for Bitcoin have increased.
Some people began to think that the block capacity of Bitcoin was too small and there was always congestion. Therefore, these people require bitcoin to be upgraded and expanded. Some people think that the function of Bitcoin is too single and its future development is not optimistic. Therefore, these people also require Bitcoin to have the function of building DApp (Decentralized Application). Some people support it, others oppose it. This bifurcation of bitcoin development can be understood as the bifurcation of bitcoin.
Bifurcation type
There are two kinds of bifurcation, hard bifurcation and soft bifurcation.
Let's talk about hard bifurcation first. Hard bifurcation actually divides the bitcoin chain into two completely different chains, one is the old chain and the other is the new chain. The old chain is the original chain of community members who don't want to cross Bitcoin, and the new chain is the chain that community members want to optimize and improve technology on the existing blockchain. These two chains will no longer cross, and will develop completely according to their own paths.
For example, Bitcoin before the fork is like an Android system, because some people are dissatisfied with the functions of the Android system and developed an Apple system. At this time, the Apple system is equivalent to the result of hard bifurcation. After the bifurcation, Android and Apple systems formed two completely different systems, and people began to use different systems according to their own preferences.
Soft bifurcation is simpler. After soft fork, Bitcoin will not produce two chains like hard fork, but stay in one chain. Soft bifurcation will be upgraded, but it will not affect the stability and effectiveness of the whole system. The old node will be compatible with the new node, but the new node is not compatible with the old node, and they can still coexist in a chain.
This is equivalent to upgrading the Android system. Many softwares in the upgraded system need your information authorization, otherwise they cannot be used. But as long as you don't upgrade, you can use these softwares without authorization. In other words, the upgraded system has stricter requirements than the pre-upgraded system (the old node will be compatible with the new node, but the new node will not be compatible with the old node).
A famous hard bifurcation event in history
Ethereum (ETH) and Ethereum Classic (ETC) are typical cases of hard bifurcation.
Dao project is a crowdfunding project initiated by Slock.it, an Internet of Things company, which was officially released in May 20 16. By June of that year, the DAO project had raised more than1600,000 US dollars. Not long after, the DAO project was targeted by hackers. Because of the huge loopholes in the smart contract, the DAO project with a market value of 50 million US dollars was transferred.
In order to save the assets of many investors and stop the panic, Vitalik Buterin, the founder of Ethereum, finally put forward the idea of hard bifurcation, and finally completed the hard bifurcation of Ethereum 1920000 block by majority voting in the community, and rolled back all Ethereum, including the Ethereum owned by hackers.
Even if Ethereum is hard-forked into two chains, there are still some people who believe in the unbreakable characteristics of blockchain and stay in the classic original chain of Ethereum. Today, both ETH and ETC rank in the top 20 in the global cryptocurrency market value ranking, which is one of the reasons why they are regarded as classic cases in the field of hard bifurcation.
Advantages and disadvantages of bifurcation
The development of blockchain technology is still in a very early stage. For blockchain, bifurcation is equivalent to a process of technical iteration. As people continue to discover the existing limitations of blockchain technology, blockchain technology can only mature if it is continuously upgraded and expanded.
Of course, this bifurcation runs counter to the unbreakable characteristics of blockchain, but there is no natural perfect technology, and blockchain is no exception. If the development of technology is uncontrollable when mistakes occur, then this technology cannot be universal and people's trust in it cannot be improved. The result of the disagreement is decided by the voting of community members, which still follows the principle of decentralization to some extent.
People have their own views on the bifurcation of blockchain, but in the historical process of blockchain development, bifurcation undoubtedly makes blockchain more story-telling and possible.