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Forks, upgrades and who decides

Lesson 5 of 6
By the end of this lesson you’ll be able to tell a soft fork from a hard fork, say how Bitcoin Cash and Ethereum Classic came to exist, place SegWit, Taproot and the Merge on a dated line, and answer the question that puzzles most newcomers: if nobody owns the network, who decides what changes?
A collage of a formal garden seen from above. A pale paved walk turns a perfect corner round a dark lawn, empty but for one small man in a top hat holding a rolled plan. Across the lawn a worn track cuts the corner, packed with a crowd in deep blue coats.

Two kinds of fork

A fork is a change to the rules. The difference between the two kinds is what happens to the computers that don’t upgrade.

A soft fork tightens the rules. Blocks valid under the new rules are also valid under the old ones, so an old node keeps following the chain even though it doesn’t understand everything in it, as long as most of the mining power enforces the new rules. Most of Bitcoin’s upgrades have been soft forks for this reason: a node that doesn’t upgrade stays on the network.

A hard fork loosens or changes the rules so that new blocks are invalid to old nodes. Everyone has to upgrade, or the network splits into two chains that share a history up to the fork block and disagree ever after. Ethereum upgrades this way, with the whole network moving together; Ethereum Unlocked 1 lists the upgrades.

Soft fork
The rules
Tightened
A node that doesn’t upgrade
Keeps following the chain
If people disagree
The enforcing side can split off
Hard fork
The rules
Loosened or changed
A node that doesn’t upgrade
Rejects the new blocks
If people disagree
Two chains

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