Cryptocurrency Fork, What It Really Means #003

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Hello great minds,

It is another beautiful day and I feel honored to come before you all today to discuss on an important issue in the cryptospace.

I trust you are doing perfectly fine and are enjoying your activities in the community as you join hands with us to promote steemit across various social media platform.

In our last discussion , we learnt about the advantages of softfork in the cryptospace and today let's find out if there are dis-advantages and what the dis-advantages are.

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DIS-ADVANTAGES OF SOFT FORK

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In blockchain technology, softfork comes with some dis-advantages that affects it's participants, network and functionality.

Although softfork are being implemented to introduce improvement and upgrade, there are still some of its dis-advantages.

And explained below are some of it's dis-advantages

BACKWARD COMPATIBILITY ISSUES

Softfork are most often designed to be backward compatible and this implies that nodes that have not been upgraded can still be a participant in the network.

However, this feature of compatibility can result to complexities as older nodes would be not be able to utilize this new features, and this slows the growth and progress of the overall activity of the blockchain.

FRAGMENTATION OF THE NETWORK

A fragmented network can be created by softfork and this is as a result of some nodes upgrading and others not upgrading.

This fragmentation of the network most oftentimes leads to communication challenges between nodes and this reduces the flow of information across the network.

A divided network can lead to susceptibility of attacks of the blockchain and also lead to a slower network consensus.

REDUCED SECURITY

Changes in the blockchain may be introduced by softfork and this has the ability to pose a compromise to the security of the blockchain.

If the upgrade introduces vulnerabilities or it is not properly tested, it's weaknesses is more likely to be exploited by malicious actors.

This vulnerability could lead to several security challenges, challenges such as unauthorized access to sensitive information or double spending attacks.

LACK OF PARTICIPATION

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Softfork are backward compatible and we all agree to that, however, some nodes might decide not to get upgraded to the latest softfork.

This decision may lead to lack of participation as a major part of the network continues operating under old rules.

And when this happens, the main reason for the creation of the softfork may not be accomplished.

INCREASED CENTRALIZATION

The use of softfork can be a contribution towards centralization, and this is so because the upgrade of these nodes requires consensus and coordination among its participants.

An advantage may be given to larger entities as decisions will be made by them and the smaller entities will be left behind as they will face a struggle of trying to catch up with this upgrade.

The decentralized nature of the blockchain network can be undermined by this centralization.

ECONOMIC IMPLICATIONS

Economic implication can be placed on network participants and miners through the use of softfork.

The profitability of mining operations may be greatly affected by changes in the consensus rules and this may lead to discontent among miners.

Inorder to maintain a healthy blockchain ecosystem, economic incentives are needed, and the stability of the network can be impacted by any disruption caused by a softfork.

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CONCLUSION

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We have considered some dis-advantages of softfork in the blockchain network.

And in our next discussion, we shall learn about the hard fork in the blockchain network.