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Soft Fork

A soft fork is a change to a blockchain’s rules that usually keeps older software compatible with the new rules. This lets a blockchain be upgraded without requiring a permanent split in the network.

Last updated • 2 min read
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What is a soft fork?

A blockchain is a shared record of transactions stored in blocks. Computers on the network, called nodes, use software to check whether those blocks are valid. When the rules in that software change, a fork can occur.

A soft fork makes the existing rules stricter. New software checks whether blocks follow these stricter rules, while older software usually still accepts new, valid blocks. As a result, participants who haven’t updated their software can continue using the same blockchain.

This differs from a hard fork, where the new rules aren’t compatible with the old ones. If participants continue following different rules, two separate blockchains can emerge.

A soft fork normally doesn’t create a new cryptocurrency. However, it’s important that enough participants support and verify the new rules to prevent problems on the network.

An example of a soft fork

A well-known example is Segregated Witness (SegWit), a Bitcoin upgrade introduced through a soft fork in 2017. The change altered how certain transaction data is stored and made it possible to process more transactions within the available block space.

Because SegWit was introduced through a soft fork, participants using older software could continue using the Bitcoin network. However, they couldn’t use all the new features or fully verify the new rules.

As a result, Bitcoin remained a single blockchain, and the upgrade didn’t create a new cryptocurrency.

Why is a soft fork important in crypto?

Soft forks make it possible to improve blockchains without requiring all participants to update their software right away. They can be used, for example, to add new features, improve security, or make the network more efficient.

That’s why you’ll often see the term in announcements about network upgrades or changes to a blockchain’s rules.

A soft fork doesn’t automatically mean an upgrade will happen without risks. If too few participants support the new rules, problems can arise during implementation. Users with outdated software may also be unable to use or verify certain new features.

The main difference from a hard fork is that a soft fork generally doesn’t cause a permanent split in the blockchain.

Disclaimer: This content is for informational purposes only and does not constitute financial, investment, legal, or tax advice. The information provided may be incomplete, inaccurate, or outdated and should not be relied upon as such. Nothing on this website should be considered a recommendation to buy, sell, or hold any cryptocurrency. Investing in crypto-assets involves risk of loss.