By their nature, virtual currencies are subject to an event known as a hard fork. This may result in the problem of unsplit coins. Here’s how to avoid it and how FairMarket Exchange can help.
1. What Is a Hard Fork?
Cryptocurrencies use consensus rules to determine whether transactions on their blockchains are valid. If any changes are made to these consensus rules, all participants must implement them in order for the system to operate seamlessly. To ensure the network’s functionality and stability, it is particularly important that entities validating transactions (miners) conform to any changes.
When consensus rules are modified, the software code that runs the blockchain is modified as well, and all users of the network also need to adapt to the new changes. The proposed changes may create compatibility with nodes that do not implement this change (backwards compatibility), which is known as a soft fork.
Hard forks occur when the proposed changes break compatibility with nodes that do not implement the changes. Whenever nodes of the blockchain refuse to implement the protocol changes and conform to the new consensus rules, there will be a hard fork resulting in the creation of a new blockchain and associated token.
2. How Do Hard Forks Affect Users?
Hard forks may create two separate blockchains that operate separately. Among the most well-known examples is the hard fork of BCH in 2018 which resulted in the new coin BSV. Another hard fork took place in 2020, resulting in BCHA and BCHN coins.
A cryptocurrency fork may result in unsplit coins for users. This means that until new coins are properly split by the user, transactions made from one of these coins will likely be duplicated for the other.
Unsplit BCH, for example, will result in the same amount of BCHA being sent to the same address (and vice versa). BCHA coins can be lost if the receiving wallet is unprepared to accept them.
3. How Should a User Deal with a Hard Fork?
Whenever a hard fork results in a new coin, it is necessary to split the coins so that the old coin is separated from the new coin prior to sending the deposit. Depending on the wallet you use, this may be done in a few different ways
4. Company’s Fork Policy
We place the utmost importance on our users’ convenience. To make a hard forked coin accessible to the broad public we may support hard forks. This depends, however, on the coin or our liquidity providers’ current situation.
Please keep in mind that despite our willingness to help, it is still the user’s responsibility to ensure the coins have been split before sending a deposit. When a user sends unsplit coins by mistake, we make every effort to track them down, capture them, and return them using our internal mechanism for turning back duplicate coins. However, we cannot guarantee all deposits can be retrieved.
Anyway, within six months from the day of the hard fork a user who sends unspilt coins can contact us at [email protected] with details about the situation. Upon this request, our tech magicians will do their best to help. Unsplit coins will only be identified six months after the hard fork, and users will have to pay the fees associated with a return transaction.