The coin forking process is often confusing and uncertain for the coin community. The reason for this is because the turf wars and adverse effects on price throw the future in jeopardy. Indeed, when the first major fork in history happened, analysts were replete with projections. In the few years that have passed since the Bitcoin and Bitcoin cash fork, there is a more consistent pattern emerging.
Hard Fork Meaning
A hardfork is essentially a radical change to a blockchain protocol that makes previously invalid blocks/transactions valid (or vice-versa). All users, therefore, need to upgrade to the new version of the protocol. In less technical words, it is a permanent divergence from the previous blockchain protocol. A new fork chain is created in the process. One path goes with the old blockchain while the other continues with the new path. After a while, those on the old chain will often feel the need upgrade to the latest version.
A hardfork can be necessary to improve on security risks in the software of the mother chain. Besides, it can be to add new functionality or even reverse transactions. An example of the latter is the hardfork to reverse the hack on the DAO in the Ethereum blockchain.
These forks often involve the coin community to a great extent. For instance, in the Ethereum hard fork to fix the DAO hack, the Ethereum community almost unanimously voted in favor of a hard fork. This was in order to roll back some transactions that siphoned off coins worth millions via the hack. The transactions confirmed by nodes which are not upgraded are effectively invalidated.
With that example in mind, it is apparent that forks can serve necessary ends. Indeed, they are not entirely a force of destruction. What is undeniable is that these forks result in a structural shakeup of the coin fundamentally.
Claiming Hard Fork Coins
At the moment, there are upwards of 40 coins with an aspect of the Bitcoin codebase. Some of these are the products of forking many times over. They include bitcoin diamond (BCD), bitcoin private (BTCP), bitcoin gold (BTG), bitcoinx (BCX) just to name a few.
Some of these coins are worth claiming while others are definitely not on account of very low market cap and value. The process of this determination is up to an individual user and shouldn’t be a problem. That said, in case you want to claim forked coins when you have a Bitcoin Ox wallet, the process is as follows:
- First things first, ensure you have an empty wallet. This is because it is better to use and empty wallet’s private keys for this process. However, since Bitcoin Ox gives you the possibility of creating multiple wallets, you don’t need a separate kind of wallet to store your digital assets. The deterministic BIP32 master public key gives you this possibility.
- Find the coin website to see if there is a specified procedure for collecting forked coins. However, note that complications may arise if BIP formats are not the same.
- The Bitcoin ox team has made collection easy for Fork Coins on the same BIP32 seed. This is because it is compatible with the BIP39 mnemonic code for deterministic keys generation.
- It is therefore reasonable to go ahead and create the wallet and get going. When you enter an existing seed to an empty wallet, the tool will provide private keys that can be copy and pasted alongside scannable QR codes. This will enable you to scan the private keys with a mobile phone. The tool also helpful in informing users of malicious mobile scanners and may save the scanned images.
Precautions When Interacting with Forked Coins
Unfortunately, not all coin forks are worth engaging for a myriad of reasons. The most obvious of this, of course, is that there are sites masquerading as fork sites but turn out to be fraudulent. Legitimate coins should not be difficult to collect and any sign of this could be a red flag. Moreover, if you find a site overly insistent on you handing over your private keys, that is not a good sign as well.
For some coins, it is important to check on compatibility and whether you can find it on an exchange in your country. This means that you can have the coin but no possibility of subsequent sale which actually beats the purpose. Once more, it vital to keep the privacy of your wallet details and ensure the coins are actually viable.
In conclusion, coin forks need not be a hellish time for wallet users especially if you’ve got Bitcoin OX. This is because the wallet has a unique procedure that makes the process of forked coin collection easy. Hard forks are sometimes necessary in the cryptocurrency world.
This is definitely a departure from the common assumption that they are a destructive occurrence since that is entirely a pricing opinion. Indeed, the more the number of coins, the more difficult it is for cryptocurrency to be a viable monetary system. Nonetheless, this is an industry big on user autonomy and decentralization and this process is a testament to that. Therefore, it is best to be prepared for and understand forks since they will always be around.