For cryptocurrency enthusiasts, the terms fork and airdrop are pretty standard, but novices might find the concept of these two difficult. Many cryptocurrency investors and traders think that both hard forks and airdrops are the same, but the disparities between these two are huge.
You might have heard of token numbers increasing automatically in your cryptocurrency wallet without any reason that is nothing but airdrop. Check https://bitcoins-evolution.com to make profits in cryptocurrency trading. Undeniably hard forks and cryptocurrency airdrop resembles one another somehow, which is one reason people get confused between these two.
The hard fork is like a two-way function as the public distributed ledger in the hard forks gets divided into parts. The foremost part continues to record the transaction of the existing system. The second part records the transaction of the new flanged cryptocurrency network. For example, the Bitcoin blockchain is divided into many parts; the actual part record transaction of the bitcoin network and other parts record the exchange of hard forks like bitcoin cash and bitcoin gold.
On the contrary, airdrops refer to transferring new cryptocurrency tokens to the holders for free. Airdrops are usually a result of cryptocurrency hard fork. Below is a complete overview of hard forks vs airdrops in the cryptocurrency industry.
- Hard fork results from absolute divination of blockchain of a cryptocurrency network into two parts. First, the hard fork only occurs when most developers mutate the code of the existing system.
- Hard fork creates a two-way function in the blockchain, a part will record the exchange of a new flanged cryptocurrency network, and the second maintains the exchange of the existing model.
- Airdrop results from hard work and is meant to increase your wallet’s number of cryptocurrency tokens.
Cryptocurrency hard forks!
As discussed above, a hard fork is usually the division of blockchain into the following parts. Once the blockchain is split into two parts, there is no going back, and it starts to record the transaction of new cryptocurrency transactions as well. Therefore, most developers are responsible for introducing a hard fork in a cryptocurrency network.
Hard forks improve a cryptocurrency network by working on a similar blockchain. For example, hard forks of bitcoin tend to improve transaction speed by enhancing the size of blockchain by almost eight times. Not merely developers, miners and other team members are also responsible for implicating a hard fork in a cryptocurrency network.
Like any other factor, the hard fork also characterizes the market price. Hard forks have been dramatically hyped over the past few years. At hard forks implication in the bitcoin network, investors were highly concerned about its credibility and were confused while investing in this coin. The mere demanding bitcoin hard fork is popular as cash.
On the contrary, the airdrop is a reward given to a definite amount of cryptocurrency investors in their wallets. Airdrop increases the number of holdings present in a cryptocurrency wallet. Airdrops are not merely the result of the cryptocurrency hard forks but also incidents like the initial coin offering. While airdropping, the developers only distribute the previous or original cryptocurrency model. For example, if Ethereum is forked, the investors will acquire the original version of Ethereum as an airdrop.
Airdrop accounts as a leading factor to skyrocket the awareness regarding the existence and feature of a cryptocurrency. Many developers and cryptocurrency exchange have promoted their projects with the assistance of airdrops. In short, an airdrop is a robust promotional means in the cryptocurrency marketplace. At some incidents, airdrops were alleged to move the market value of cryptocurrencies; you might wonder why.
Since the airdrops reward the investors with free tokens, investors without holding them decide to trade them with other fiat and cryptocurrencies. If a large sum of investors does the same, it slumps the market value of a digital currency. In such a way, the airdrop is different from hard forks. On the other hand, the hard forks and airdrops seem to exert a magnificent influence on the price of a currency.
The portion mentioned above explains an absolute difference between airdrops and hard forks.