A new study published on Wednesday now suggests that hard forks are not only a confusing aspect for the general crypto public to get behind, leading to the alienation of more casual investors and adopters of the coin, but potentially dangerous to the stability of the entire industry. According to researchers out of the Oak Ridge Institute for Science and Education, who investigated over 800 soft and hard forks from Bitcoin, the possibility of contentious forks could lead to the undermining of the industry of cryptocurrency despite the potential for widespread adoption. The study concluded that crypto has the potential to alter the future state of commerce, fintech and global information exchange through the use of blockchain. However, hard forks lead to governance challenges which create a lack of trust in the currency. Essentially, the average investor in Bitcoin is relying up the coin’s limited supply and written-in-stone governance, a detail that appears meaningless in the event of repetitive forks,
“Disruption of a cryptocurrency’s blockchain in this way might cause people to lose trust in it and its capacity to survive as a reliable vehicle of exchange,”
While Bitcoin Cash (BCH) has managed to become a mainstay in the industry, with a vast amount of adoption and developmental capital being driven through the coin, including the soon to IPO cryptocurrency goliath Bitmain, the majority of BTC forks fail to live past several months and projects are usually shells within a year. Similar to the declining ICO market, the ease of developing a forked coin has lowered the barrier of entry so significantly that the market has been flooded with projects that barely have an underlying idea let alone a roadmap for usability. Forked coin instigators are betting on market confusion in conjunction with the trendy nature of blockchain and cryptocurrency to drive errant capital–a technique that found some success at the end of 2017, but was widely criticized earlier in the year with the introduction of Litecoin Cash. Litecoin Cash was almost universally regarded as an attempt to capitalize on the brand name of the seventh largest cryptocurrency by market cap.
Hard forks present both an intrusion upon the confidence of investors and users of cryptocurrency as well as presenting a further source of confusion for the broader public still trying to wrap their head around crypto. The paper further adds that stability is necessary for the continued growth and thriving of the industry,
“Hard forks are a threat to maintaining a stable and predictable operating platform that is essential if cryptocurrencies are to be adopted for daily financial transactions.”
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