Good morning, how was our nights? I am sure they are fine. I am glad to make my entry for this week's lecture on beginners level - Fork.
"Question 1: What is a Fork? (In your own words)
Simply put, a Fork is a change that occurs in the blockchain's mode of operation, that is the change affect the basic rules and regulations guiding the use of block of data. This effect must be agreed on by the team of the particular blockchain that is want to fork. Any time this new development take pkace, the chain of data divided into two - one original and the other a new one. The new block carries the new set of rules or protocol as well as the information of the original one, but it takes a new direction.
Worthy of note is that, this new development improves the functioning of the blockchain, making it more faster and secured. Also, there is the possibility of creating a new coin and ecosystem from this process - FORK. The image below depicts a fork.
"Question 2: Explain in details what Hard Fork is with examples (Can be of any blockchain).
Hard Fork occurs when a chain of data or nodes accept a set of new rules, leading to the production of new blovkchain. In other words, it divided into two separate networks, one has the new updates, while the other retains the former rules. It is referred to as backward incompatible because they are working on different blockchain, but they still maintain the same history. Therefore, the holders this particular blockchain before the fork will have a coin on the new nodes.
The new chain can only work with the ones that accept this new upgrades. As we all know, whenever there is an upgrade in the operating system like the computer, the new operating system will work faster and better than the former one, due to the modifications. The same principles applies to blockchain fork.
The typical example is the Bitcoin fork in 2017. The community saw the need for this change as it will improve the block size, efficient transactions and it will be more secure. They implemented it, hence, Bitcoin fragmented into two different chains, the original one Bitcoin (BTC) remains, and the new coin Bitcoin Cash (BCH) emerges.
Other examples are Bitcoin Gold, Bitcoin Unlimited, and more.
"Question 3: Explain in details what a soft fork is with examples (Can be of any block chain).
In a lay man's understanding, soft fork is the opposite of hard Fork. Instead of rejecting or refusing the set of new rules from the old one, the new one tricks the old blockchain into accepting it's protocols despite the change in the softwares operation.
Hence, soft fork is backward-compatible. The two blocks work hand in gloves in maintaining two lanes with separete sets of rules.
A perfect example is the Segregated Witness Bitcoin Protocol update of 2015. Before the update, the price was so high, it takes a lot of time and the signature data takes about 65% of a transactional block. Thus, there is need for this update. More space is required for transactions. With the aid of soft fork, the new rules on the blockchain was successfully formated without interfering the old one's rules. The blockchain formed increased from 1MB (the old) to 4MB (the new one) both still work together.
"Question 4: What are the differences between Hard Forks and Soft Forks?
- Under hard fork, the chai s of data divides into two.
- It produces new cryptocurrency.
- The block heights are repeated.
- The new set of rules does not agree with the in the old blockchain, that is backward-incompatible.
- No division of the blockchain.
- There is no production of a new currency.
- The blockchain heights re repeated.
- It is a forward compatible process as the upgrade give room for the new software to allow the old ones to remain.
"Question 5: Explain the following Bitcoin Forks and explore the blockchain where necessary. Indicate if they are hard forks or soft forks;
- Bitcoin Cash
- Segregated Witnesses
It is a Cryptocurrency that exhibit the same qualities as Bitcoin (BTC) but also incorporate a good number of changes and attributes that causes it to be different from the original Bitcoint (BTC). It was created on August 1, 2017 by means of Bitcoin Hard fork.
It has the following features:
- it is open for anyone to use it or own it without censorship.
- there is transparency in the recordings of information in the blockchain through the nodes, which is regularly updated.
- these nodes must adhere to the set of rules.
- it is immutable, because the processes involved do not allow alteration of transactions.
- It is highly secured as a result of the Proof of Work (PoW) process Incorporated.
- Only 21 million of this coin can be produced, making it a hard asset like gold.
- Fees involved are low as a result of it's fast, affordable transactions to any location and in any value.
- Bitcoin Cash (BCH) also have a long-term store of value as the users cannot change or alter the protocol. The schedule of supply enhances its value as it is reduced in every four years.
Bitcoin Cash as an alternative form of money, aids economic freedom. It is a strong protection against monetary consfication, censorship and devaluation through inflation.
Segration Witnesses are by-product of soft fork. The reason behind this fork is to bring down the size of a Bitcoin transaction by changing the way the transaction comes, by so doing, the quantity of this transaction that the block will accommodate will automatically increase. It was put into operation in 2017.
Simply put, SegWit is the splitting of the blockchain into two separate blovks. One containing the wallet addresses if the sender and reciever and the other part - the witness data, which is the transaction signature. This process of change in Bitcoin's set of rules or protocols allow it's users to change their transaction hashes, leading to an entirely another transaction hash and this do not allow the ID to be changed again.
Besides causing a reduction in block size and increasing the speed of the network, Segregation Witnesses has helped in the scalability of Bitcoin and other Cryptocurrency network. Thus, it is widely accepted both directly and indirectly.
"Question 6: Write on the Steem and Give Hard Fork and show similarities in their Genesis Blocks (Provide screenshot).
As a result of the decentralization in blockchains, the good governance of the network depends not on one person's opinion but the team behind the scene. When TRON announced the takeover of Steem, not every member supported the idea. This action led to the hard Fork on steem, giving birth to Hive blockchain.
Just as Steemit has steem as its token and Steem Backed Dollars (SBD) as it's supportor, likewise Hive. Hive is also a blockchain content creation platform that have HIVE POWER (HP) as it's influence token, supported by Hive Backed Dollars (HBD).
With their Genesis Blocks, we can notice some similirities.
Steem Genesis Block for 1 transaction
Hive Genesis Block for 1 transaction
From the images above, the mining time and date are the same as well as the miner
Also when we use other sample size in both blocks like 5000, the same similarities are shown - date, time and miner.
From this week's lecture on Fork and it's types, it is very Paramount that blockchain of any Cryptocurrency should undergo fork, as this changes leads to a lot of improvements on their performance, makes them more secure and above all new currencies are created.
I appreciate my able professor.
My best wishes to the Admin.