Crypto Forks: What Actually Happens When a Blockchain Splits in Two
Soft forks, hard forks, and the handful of famous splits that created entirely new coins, explained without assuming you already know the difference.
By Firoz Khan|13 September 2026|Updated 20 September 2026|7 min read
A fork happens when a blockchain's rules change, and depending on how that change is implemented and whether the network agrees on it, the result ranges from a routine software upgrade nobody notices to an outright split into two separate, competing chains and, often, two separate coins.
Soft forks: backward-compatible rule tightening
A soft fork tightens the rules in a way that's still recognised as valid by nodes running the older software, it narrows what's allowed rather than expanding it, so the network can upgrade gradually without splitting. Most routine Bitcoin protocol upgrades have been implemented this way specifically to avoid a chain split.
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Hard forks: rule changes that aren't backward compatible
A hard fork changes the rules in a way older software won't recognise as valid, which requires every participant to upgrade or risk being left on an incompatible, minority chain. If the community doesn't fully agree on the change, the chain can permanently split into two, each continuing under its own rules from that point onward.
When a split creates an entirely new coin
Bitcoin Cash split from Bitcoin in 2017 over a disagreement about block size, and Ethereum Classic split from Ethereum in 2016 following a contentious decision to reverse a major hack, with the original, unreversed chain continuing on as Ethereum Classic. In both cases, anyone holding the original coin at the moment of the split typically ended up holding a matching balance on both resulting chains.
Why forks matter beyond the history lesson
A pending hard fork can affect exchange withdrawal availability, wallet compatibility and price volatility in the run-up to and aftermath of the split, and holding an asset through a contentious fork means genuinely tracking which chain your exchange or wallet actually supports and recognises as the 'real' continuation.
A reminder
The FCA risk warning still applies to higher-risk crypto content. Always assess how much risk you are willing to take before buying.
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