In the realm of blockchain and cryptocurrencies, a "breaking" event occurs during a hard fork, which represents a significant transformation or upgrade in a network's software. This "breaking" situation arises when the new version of the software introduced in the hard fork lacks compatibility with the previous version, resulting in an inability to understand each other's transactions and blocks. Consequently, this causes a division or "break" in the network's transaction history and functioning. The outcome involves two separate chains, each operating under its distinct set of rules, possessing unique transaction histories and participant groups. In the aftermath of the split, both chains continue to exist independently, generating new cryptocurrency tokens on the new chain, while holders of the original cryptocurrency receive equivalent amounts of the new cryptocurrency. The ultimate dominance and value retention of one cryptocurrency over the other depend on decisions made by the cryptocurrency community, miners, and users, factoring in elements like adoption, security, and developer support.
A notable illustration of this "breaking" scenario is the Bitcoin Cash (BCH) hard fork from the original Bitcoin (BTC) network. The BCH hard fork introduced modifications, including larger block sizes and different consensus rules, rendering it incompatible with the BTC network. Consequently, this event led to the emergence of two distinct blockchains and cryptocurrencies: Bitcoin (BTC) and Bitcoin Cash (BCH).
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