What is a Hard Fork?

A hard fork is a significant and permanent divergence from the existing blockchain protocol, resulting in the creation of a new and incompatible chain. Hard forks occur when there is a fundamental disagreement or change in the network's consensus rules, governance mechanisms, or protocol specifications. Upon a hard fork, the new chain retains the transaction history and balances of the original chain up to the point of divergence but introduces new rules, features, or functionalities that are not backward compatible. Hard forks can be planned or contentious and can lead to community splits and network disruptions if not managed properly.