A hard fork is a major update to a blockchain, creating a new chain that runs parallel to the original chain but has different protocols or features. Hard forks often bring significant changes (i.e. new features or fixes for important issues), but can sometimes cause divisions in the community when participants compare versions.
Importantly, the new version is not “backwards compatible” with the old version – meaning that applications and data from the old version will not be compatible with the new version. And that is why it is called a “hard fork” – a more drastic change to the blockchain.
For example, Bitcoin Cash is a famous hard fork of Bitcoin. In 2017, the Bitcoin community was arguing about how to scale the network to handle more transactions. This disagreement led to the creation of Bitcoin Cash, a separate blockchain with larger block sizes, allowing for more transactions per block. This fork is incompatible with the original Bitcoin blockchain, creating two separate cryptocurrencies.
Differentiating soft forks from hard forks
Unlike hard forks, soft forks are changes that are “backwards compatible.” Instead of creating a new chain, soft forks upgrade the existing chain. They often introduce new rules that are compatible with the old blockchain, allowing nodes that have not been upgraded to still recognize new blocks as valid.
The Segregated Witness (SegWit) upgrade on the Bitcoin network is an example of a soft fork. SegWit does not create a new blockchain; it simply modifies the existing Bitcoin blockchain. This soft fork was introduced in 2017 to increase the block size limit and improve transaction malleability.
Cardano Chang Hard Fork Overview
Cardano is a blockchain launched in 2017, incorporating Ouroboros – one of the highly regarded PoS consensus algorithms for its ability to balance security, decentralization, and energy efficiency.
With low transaction costs, active community participation, and a solid technical foundation, users and developers continue to build and invest in the platform.
The Chang hard fork is an important milestone in the development of the Cardano blockchain. In addition to enhancing security, the main purpose of this hard fork is to advance the roadmap of Cardano, especially as the project moves towards the “Era” Voltaire.
It is important to note that Cardano’s hard fork differs from regular hard forks because it uses the “Hard Fork Combinator” mechanism, which allows for seamless upgrades without creating a split in the blockchain. Unlike traditional hard forks, which typically create two separate chains, Cardano’s process maintains a single, seamless chain, ensuring a smooth transition without disruption.
Combinator is a technical term for a combination of specific processes or elements. In Cardano’s case, the “Hard Fork Combinator” will merge different protocols, allowing for a smooth transition between phases without any disruption.
This new phase allows Cardano (ADA) holders to have a more direct say in shaping the future of the network. They will participate in important decisions, marking a major step forward in realizing Cardano’s vision of a fully decentralized blockchain platform.
Comparing Chang to Previous Cardano Upgrades
The Chang hard fork is the latest in a series of important upgrades that have shaped the development of Cardano. In the Cardano roadmap, these upgrades are organized into “phases.”
- Byron Era (Foundation Phase)
Before the hard fork, Cardano’s journey began with the Byron “era” – the foundation phase of the Cardano blockchain. Launched in September 2017, Byron established the core structure of the network, including the launch of the ADA cryptocurrency and the Daedalus wallet.
The Byron “era” is a consortium phase, where the network is controlled by a small group of nodes operated by IOHK, Emurgo, and the Cardano Foundation.
- Shelly Hard Fork (Decentralization)
The Shelley hard fork, launched in July 2020, marked the transition of the Cardano network from the Byron “era” to the Shelley “era,” which focuses on decentralization. This hard fork introduced the concept of staking and delegation, allowing ADA holders to participate in securing the network by running their own stake pools or delegating their ADA to existing pools.
The level of decentralization achieved at this stage is a significant step towards Cardano’s goal of becoming a fully decentralized blockchain, shifting control of the network from a centralized model to a distributed model run by the community.
- Goguen (smart contracts) era – Alonzo hard fork
The Alonzo hard fork, completed in September 2021, ushered in the Goguen era and brought smart contract functionality to Cardano. This upgrade allows developers to build and deploy decentralized applications (DApps) on the blockchain, significantly expanding the capabilities of Cardano beyond simple transactions.
The introduction of smart contracts is an important step in enabling complex financial services, decentralized finance (DeFi) applications, and NFTs, making Cardano a more flexible and competitive platform in the blockchain space.
- Basho era (scalability and optimization)
Following the Alonzo upgrade, the Basho “era” focuses on optimizing Cardano’s scalability and performance. During this period, developers introduced various updates and improvements, such as the Vasil hard fork, named after Vasil Dabov – a Cardano community member.
The Basho “era” focused on improving the network’s throughput and interoperability, ensuring that Cardano can handle higher transaction volumes and support more complex DApps with higher performance.
- Voltaire Era (Governance) – Chang Hard Fork
Finally, the Chang hard fork is the latest upgrade to date, marking the beginning of the Voltaire “era”.
Technical aspects of the Chang hard fork
The Chang hard fork introduced several important technical upgrades that enhanced the network’s performance and capabilities.
- Decentralized Governance
Through Chang, Cardano established on-chain governance processes, including the creation of a constitutional committee (CC), delegated representatives (DReps), and new governance roles for stake pool operators (SPOs).
These elements are designed to accelerate community decision-making, allowing stakeholders to directly influence protocol improvements and network governance. CCs are tasked with maintaining the “constitution” of the Cardano network, ensuring that any changes are in line with the community’s strategic vision, while DReps allow ADA holders to delegate their voting power to trusted representatives, streamlining the governance process.
- On-chain Voting
Chang also facilitates on-chain voting, a key element of decentralized governance. This feature allows stakeholders to directly propose and vote on-chain to decide on protocol changes and other governance-related issues.
On-chain voting ensures transparency and accountability in the decision-making process, as all votes and proposals are recorded on the ledger, allowing the entire community to participate and observe the governance process. This mechanism will increase the legitimacy of governance decisions and encourage more active participation from ADA holders.
- PlutusV3 Ledger Language Improvements
PlutusV3 brings advanced primitives and cryptographic capabilities that enhance the functionality and security of smart contracts on the network.
3.1. BLS12-381 Primitives
A new set of built-in functions that verify Zk proofs – essential for ensuring privacy and security on the blockchain.
3.2. New Hash Primitives
Added the Blake2b-224 and Keccak-256 cryptographic hash functions. They are used to authenticate transaction signatures, improve compatibility with Ethereum, secure the data verification process, and enhance Cardano’s overall security framework.
3.3. SOP
This new data type encoding method in Plutus Core will improve the script and optimize the code generation process for the Plutus Core compiler, resulting in faster program execution and more streamlined smart contract development, making PlutusV3 more powerful and flexible for developers.
3.4. Bitwise Primitives
The introduction of two new bitwise primitives, integerToByteString and byteStringToInteger, will greatly improve low-level bit operations. These prerequisites enhance performance optimization, support cryptography and algorithms, and data structures in smart contracts, allowing for more complex DApp development.
- Additional Features
In addition to these core upgrades, the Chang hard fork introduces a number of other features.
4.1. Reference Scripts for Plutus v1
This upgrade allows legacy scripts to leverage reference scripts, reducing DApp costs and increasing on-chain capacity. This change is especially important for optimizing the cost and scalability of decentralized applications on Cardano.
4.2. Protocol Parameter minFeeRefScriptsCoinsPerByte
This new protocol parameter refines the Plutus fee model, allowing for more accurate fee calculations by separately adjusting the costs for reference scripts – ensuring that fees remain fair and predictable, even as the network scales.
4.3. Adjustments to SPO Deposits
The Chang hard fork introduces separate tracking of SPO deposits, distinguishing between stake address registration deposits and stake pool registration deposits, contributing to improved transparency and manageability of deposits on the network.
4.4. General Ledger Rule Improvements
Various improvements to the general ledger rules are also included in the Chang upgrade, ensuring a more secure ledger operation.
Future Outlook after the Chang hard fork
Chang can be said to mark the beginning of the “era” of Voltaire, focusing on decentralized governance.
The first phase focuses on the release of an interim version of the Cardano constitution by Intersect – a membership-based organization in the Cardano ecosystem. Along with that, the development team also established an interim CC, initially consisting of seven members, three of whom are from the Cardano community.
The second phase will further decentralize governance by introducing dRep, which allows ADA holders to delegate their voting power to trusted representatives. This change will ultimately put the future of Cardano in the hands of its community, in line with the network’s long-term vision of a self-sustaining, decentralized ecosystem.
While the outlook is promising, the road to a fully decentralized future is still fraught with challenges.
For example, ensuring that a diverse and representative group of community members are elected to the CC will be critical. Additionally, there is the potential for community divisions, especially as new governance mechanisms are tested and refined.
Therefore, while the Chang hard fork is an exciting update for the Cardano network, its success will largely depend on the community’s ability to collaborate and make informed decisions about the future of the network.
