Dear Steemit Friends,
Cryptocurrency fork is confusing for most of new traders. I would like to explain in simple words
In programming terminology, the meaning of fork is independent development from existing source code, from one software becomes two different software or more. To make it easy we can use example Linux and Android. Android is fork of Linux, Android is different product but its source from linux source code. We have to separate between software development for upgrade purpose and software development for fork purpose. Software development for upgrade has no intention to create different product, it improves the software better for user.
Software development upgrade for cryptocurrency is little bit different because cryptocurrency has consensus factor. Software development upgrade can be fork when there is party that disagree with upgrade and keep using the old software. We can use Ethereum for example, in early 2017 Ethereum upgraded their source code but some parties did not agree and still use it the old one. The parties refused to change to the new blockchain and decided to remain in the old blockchain naming it “Ethereum Classic” or “ETC.” So we can conclude that software development for upgrade could be fork if some parties do not agree.
There are many development for fork intention. Bitcoin is the most cryptocurrency that developed for fork. Bitcoin Cash and Bitcoin Gold are fork of Bitcoin. Those cryptocurrency has high value after successful fork but most of fork cryptocurrency has no value because no one use it.
Here some of fork product that I never found at major exchanges. I never trade this cryptocurrency
You can read here to know more https://bitcointalk.org/index.php?topic=2749969.0;all
When you have bitcoin and there is developer create new cryptocurrency fork bitcoin's source code you will get new cryptocurrency for free. It could be 1:1 ratio or 1:10 ratio or more. For example if you had 1 bitcoin on 1 August 2017 you got 1 bitcoin cash.
So we can conclude that the one who hold the most bitcoin has the most bitcoin. So the developer of bitcoin cash supposed to have bitcoin in huge amount before the fork
Let we analyze what happened to bitcoin price before and after fork (bitcoin cash launched). Let assume that we exclude other factors.
1 month before bitcoin cash launched, bitcoin dropped 30% from $2600/btc to $1830/btc, this is the way to get more bitcoin from the market, make people panic and buy bitcoin at low price and then 2 weeks before bitcoin cash launched bitcoin price rose to $2800, higher than a month before. So we can conclude that fork is a benefit for bitcoin holder.
Bitcoin ABC (bitcoinabc.org) as the main developer of bitcoin cash has planned for network upgrade. Bitcoin Cash network will undergo a protocol upgrade. Upgrade definition here confused by news and social media as a hardfork. It could be a hardfork if any parties keep existing protocol and create new blockchain.
The major parties of bitcoin cash (mining and exchange) agreed to upgrade network of bitcoin cash and it seems that there is no fork on bitcoin cash in this case. Protocol upgrade is a good news for cryptocurrency because it improves their features and higher price.
I hope this article could help you. If you have any feedback please feel free to write comment. Thanks.
