A permanent split in a blockchain protocol that occurs when nodes adopt a new set of rules that aren’t backward-compatible. It creates two distinct chains: one following the old protocol and another following the new. Hard forks can be planned (to upgrade features) or contentious (resulting in separate cryptocurrencies). Famous examples include Bitcoin Cash from Bitcoin and Ethereum Classic from Ethereum. Hard forks often arise from community disagreements over security, scalability, or governance. While they can introduce innovation, they may also create market uncertainty and require users to update software or wallets accordingly.
Example:
In 2017, Bitcoin split into two chains due to a disagreement over block size.
The new chain became Bitcoin Cash, creating a separate cryptocurrency alongside Bitcoin.
