What it is
A hard fork is a fundamental change to a blockchain's underlying protocol that makes previously invalid blocks or transactions valid, or vice-versa. Because the new rules are incompatible with the old ones, all nodes that wish to continue participating in the network must upgrade to the new software. If a significant portion of the network does not upgrade, the blockchain can split into two separate, independent chains, each following different sets of rules.
Hard forks are often implemented to introduce major new features, address critical security vulnerabilities, or reverse large-scale hacks, as seen with the split of Ethereum and Ethereum Classic in 2016. News reports frequently cover hard forks, detailing the proposed changes and their potential impact on the network and its users. Retail investors must stay informed about hard forks because they can lead to new tokens (if the chain splits) or significant changes in network functionality and value.
Why it matters
Retail investors care about hard forks due to their potential to create new tokens, split a blockchain community, or introduce significant changes affecting network functionality and asset value.
Reviewed under editorial standardsUpdated September 26, 2026Not investment advice