Maybe you’re new to cryptocurrency and blockchain market, or maybe even though you don’t consider yourself to be tech-savvy, you like to learn more about NFTs, different cryptocurrencies, and DeFi projects; in either case, our weekly recap is for you!
In this week’s recap, we want to talk about one of the famous blockchain terms while checking the market condition of two coins that experienced it: Hard Fork.
Ethereum and Ethereum Classic
let’s take a quick look at the market condition of Ethereum and Ethereum Classic first.
Source: CoinMarketCap.com
As you can see, the highest price for Ethereum (ETH) in the past 7 days was $3,030. You can also see that the lowest price of the week for Ethereum Classic was $26.04.
All-Time High (ATH) and All-Time Low (ATL) are two terms that you may have heard of, especially about Bitcoin. All-Time High is the highest price an asset ever recorded.
By comparing ATH to the current price, you can understand the overall market condition. For example, the current market price for Ether is around $2,500, which is almost half of its ATH. You can see that since November, Ether has lost half of its value. Dig a little deeper and you’ll realize that the whole crypto market has been experiencing this.
Recorded ATH for different crypto assets may slightly be different in each platform but you can get a general idea of how far the price went up.
You probably can guess what an All-Time Low is now. It’s the lowest price ever recorded for a cryptocurrency. ATL is not used in crypto space as much as ATH, and you may not hear about it often.
What is a Hard Fork?
People get separated, so do blockchains. Most blockchain systems are open, public, and user-centric. Simply put, there is no single manager or boss, and users decide on the system’s rules and conditions. But what happens when they can’t settle an issue?
Just like in real life, they separate and part ways, and we call their separation a Hard Fork.
This is exactly what happened to Ethereum blockchain. In 2016, one application on Ethereum network, named ‘The DAO’, experienced a $60M hack and the Ethereum users couldn’t decide on one solution to solve the issue.
You may have heard that a blockchain system is permanent or immutable. This simply means that the records and information on a blockchain system will be there forever. No single entity can delete or reverse them.
After the hack, some users believed that they should reverse the hacker’s transactions to retrieve the stolen funds. And others disagreed. They wanted to respect the core principles of blockchain systems and don’t tamper with the transaction history. In the end, they didn’t reach a consensus and decided to part ways and have two separate systems.
One group reversed the transactions and retrieved the stolen funds. We know this group as Ethereum blockchain today. The other one formed Ethereum Classic and left the transactions untampered.
After the hard fork, the two systems become independent and even though they share the same past, they create a new, separate future.
Endnote
All-Time High (ATH): the highest price an asset has ever experienced.
All-Time Low (ATL): the lowest price ever recorded for an asset.
Immutable: records and information on a blockchain system will be there forever. No single entity can delete or reverse them.
Hard Fork: when a blockchain is divided into two independent and separate blockchain systems.