Let’s Find Out the Differences Between the Cryptocurrency Hard Fork and Airdrops!

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Cryptocurrency enthusiasts are familiar with every slang, term, and phrase used in the digital currency community. However, rigid fork and airdrops are two infamous terms that only a few people know. Even people who have deeply studied the cryptocurrency market consider that hard fork and airdrops are two similar concepts. If you are interested in bitcoin trading, visit Bitcoin Boom App to acquire an utter guide to crypto trading.

There is an analogy between these concepts, but hard fork and airdrops correspondingly hold some differences. A hard fork is a term used to refer to incidents of a blockchain split on a particular cryptocurrency network. For example, if the blockchain of bitcoin splits between two parts permanently, it is hard forked by its member. Forks are usually of two different types: soft fork and hard fork. Here is a detailed comparison between the concept of airdrops and cryptocurrency hard forks.

Key Takeaways!

  • A hard fork is a term used to refer to incidents of blockchain permanent split between two parts. For example, each blockchain model is equipped with a source code, and if members of a particular cryptocurrency network alter the source code, it causes a split between the blockchain.
  • At the instance of hard forks, blockchain gets split into two pathways. And whenever a hard fork occurs, the first-ever pathway incurs the authentic version of the electronic ledger. The second pathway consists of the new version of the electronic ledger.
  • The split only occurs in the original blockchain version, not the freshly created or forked versions. This is because hard forks can occur multiple times in a cryptocurrency network, and bitcoin is a robust example of such a case.
  • Airdrop is a whole different concept than of hard fork. Airdrops claim to raise the number of particular digital tokens stored in an e-wallet by the user. For example, ethereum announces an airdrop for its first 500 loyal users; the number of ethers present in the e-wallet of these members will increase automatically.

At many incidents, airdrop was sent as a reward for the hard fork by the cryptocurrency community.

Cryptocurrency hard fork!

A hard fork is an infamous term to refer to incidents of blockchain splits permanently on a cryptocurrency network. Some famous bitcoin hard forks are bitcoin gold, bitcoin classic, Bitcoin XT, and segregated witness. The people involved in cryptocurrency hark forks are usually from the developer team of that currency. Miners are also allowed to participate in the discussion of cryptocurrency hard forks. Hard fork results in a new flanged part of the blockchain that records each transaction of a new version of that cryptocurrency. When it comes to one of the most exciting moments in a particular cryptocurrency network, hard forks always top the table, and then come airdrops and burning events.

If a cryptocurrency developer wants to diversify the use case of a digital currency, a hard fork is necessary. People think hard forks are only executed on a cryptocurrency network when two developers or mining communities dispute. However, this is not true at all sometimes. The cryptocurrency community supports two different ideas at a particular time, leading to hard forks.

Airdrops!

Airdrops are another most exciting moment in the cryptocurrency community as it leads to an increase in the number of digital currencies in an e-wallet. Airdrop is famous as a potential method to avail free cryptocurrencies, but prominent digital currency networks distribute it only for limited use. Initial coin offering is a famous way to distribute digital currencies in airdrops to the users.

If a cryptocurrency network goes under digital currency hard fork, it might distribute the freshly created hard fork in the form of airdrops. However, a hard fork is not the very reason to distribute cryptocurrencies in the form of a hard fork. The developers can also use airdrops to create awareness of a digital currency amongst the members of this community.

Airdrops do not always do well for a particular cryptocurrency network, leading to panic. For example, ethereum networks distribute ether to a particular group of investors in the form of airdrops. And these members will sell off the free tokens availed through airdrops; this will decline the market price of ether.

The above portion describes everything you should know about cryptocurrency hard forks and airdrops. 

The views expressed in this article are those of the authors and do not necessarily reflect the views or policies of The World Financial Review.