Soft and hard fork

Barbara asked 3 months ago

hi Ofir! 
Could you  please clarify the hard/soft fork issue: what are they about and how, according to you, this matter will affect bitcoin price. 
Thanks in advance for you help :) 
have a good day 
Barbara

2 Answers
Ofir Beigel Staff answered 3 months ago

Hi Barbara! Sorry it took me so long to respond.
The answer to this question is really a very long one, but I’ll try to make it as short and simple as possible.
At the moment there’s a debate going on in the Bitcoin community whether the Bitcoin protocol should be changed in order to allow faster transactions. I won’t go into the arguments of each side, but if this debate won’t get solved it may cause a “fork” in the Bitcoin network.
This means that people from group A of the debate will use one form of Bitcoin and people from group B will use another. It will essentially cause Bitcoin to split into 2 different coins – this will also have some sort of effect on the price (probably bringing it down).
If this actually happens this means there will be a hard fork. Instead of using the word “fork” try using the word “split”. So a hard split means that you will have to choose whether you’re using Bitcoin A or Bitcoin B and update your software (i.e. your Bitcoin wallet) accordingly. We really don’t want this – Bitcoin is hard enough to use as it is….
A soft fork means that Bitcoin can still split but no one has to choose a side just yet – everything will work whether you updated your software or not. It’s an easier way of implementing changes and seeing who actually supports them. Once we see enough people have updated their software to the new version we can decide that we have a majority of people agreeing for a hard fork and fork the network without too many issues.
The recent soft fort suggested was that of Segwit – you can watch a short video about this here that will further clarify the subject. Hope this helped.
 

gbenga answered 3 months ago

Is it because of the confirmation time that bitcoin will be forked or because of the bugs on bitcoin unlimited

P Bras replied 3 months ago

Neither.

There will be a hard fork when Bitcoin Unlimited decides to quit the 1 Mb limit. They will mine a block which is too big for Bitcoin Core, so than there is a split between Bitcoin Core and Bitcoin Unlimited. Recently there was a bug in BU which leaded to a block of a little bigger then 1 MB, but this was corrected quickly. BU stated that they did not want to create a hard fork.

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