Crypto Basics

What is a Hard Fork and How Does it Work?

Discover what a hard fork is and how it works in blockchain technology. Learn about its impact and implementation in this comprehensive guide
S. Vishwa
5 Minutes
MIN

In the world of blockchain technology, a hard fork refers to a significant and radical change in a network's protocol. This change results in the creating of two separate branches, one following the previous protocol and the other following the new version. 

Unlike a soft fork, which is a minor upgrade to the protocol, a hard fork requires all nodes or users to upgrade to the latest version of the protocol software.

Understanding Blockchain and Forks

Before delving into hard forks, it's important to understand the basics of blockchain technology. A blockchain is a decentralized digital ledger that records transactions and other events in a series of blocks. 

Each block contains data and a set of instructions, known as protocols, which dictate how the blockchain network functions. Because a blockchain is decentralized, any changes to its protocol need to be voted on and approved by its community of users. 

When developers propose major changes or disagreements arise regarding the development of a blockchain, a hard fork may be initiated to create a new and separate blockchain.

How Does a Hard Fork Work?

When a hard fork occurs, the new version of the blockchain is no longer compatible with older versions. This creates a permanent divergence from the previous version of the blockchain. 

The new rules and protocols implemented through the hard fork create a fork in the blockchain, with one path following the upgraded blockchain and the other path continuing along the old one.

Miners, who play a crucial role in verifying transactions and maintaining the blockchain, must choose which blockchain to continue verifying. Holders of tokens in the original blockchain will also be granted tokens in the new fork. 

However, it's important to note that the old version of the blockchain may continue to exist even after the fork, potentially with security or performance flaws that the hard fork aimed to address.

Reasons for Hard Forks

Developers may implement a hard fork for various reasons. One common motivation is to correct significant security risks found in older versions of the software. 

Hard forks can also introduce new functionality or reverse transactions, as seen in the case of the Ethereum blockchain's hard fork to address the hack on the Decentralized Autonomous Organization (DAO).

In 2016, the Ethereum community unanimously voted in favor of a hard fork to roll back transactions that resulted in the theft of millions of dollars worth of digital currency. 

The hard fork allowed DAO token holders to retrieve their funds through a newly created smart contract. While the hard fork did not undo the network's transaction history, it enabled the recovery of stolen funds and provided failsafe protection for the organization.

Examples of Hard Forks

Hard forks have occurred in various blockchain networks, not just in Bitcoin. Bitcoin itself has witnessed several notable hard forks. 

In 2014, Bitcoin XT emerged as a hard fork to increase the number of transactions per second that Bitcoin could handle. However, the project lost interest and is no longer in use.

Another significant hard fork in the Bitcoin ecosystem took place in 2017, resulting in the creation of Bitcoin Cash. 

The hard fork aimed to increase Bitcoin's block size to improve transaction capacity. Subsequently, in 2018, Bitcoin Cash experienced another hard fork, leading to the emergence of Bitcoin Cash ABC and Bitcoin Cash SV.

Ethereum, another prominent cryptocurrency, also underwent a hard fork in response to the DAO hack mentioned earlier. The fork resulted in the creation of Ethereum Classic, which maintained the original blockchain and the updated Ethereum network.

Pros and Cons of Hard Forks

Hard forks offer several benefits to blockchain networks. They can address security issues, enhance the performance of a blockchain, and introduce new features or functionalities. 

Hard forks also provide an opportunity for participants in a blockchain community to pursue different visions for their projects and potentially resolve disagreements.

However, hard forks also come with disadvantages. They can confuse investors when a new but similar cryptocurrency is created alongside the original. 

Furthermore, hard forks may expose blockchain networks to vulnerabilities, such as 51% attacks or replay attacks. Additionally, the existence of the old version of the blockchain after a hard fork may lead to security or performance flaws that the fork aimed to fix.

Hard Forks vs. Soft Forks

While hard forks create two separate blockchains, soft forks result in a single valid blockchain. In a soft fork, the blockchain's existing code is updated, but the old version remains compatible with the new one. 

This means that not all nodes or users need to upgrade to the latest version of the protocol software. The decision to implement a hard fork or a soft fork depends on a blockchain network's specific goals and requirements. 

Hard forks are often favored when significant changes are necessary, even if a soft fork could potentially achieve the same outcome.

Conclusion

Hard forks play a significant role in the evolution of blockchain technology. They allow for radical changes to a network's protocol, creating new blockchains and potential improvements in security, performance, and functionality. 

However, hard forks also come with risks and challenges, such as confusion among investors and possibly exposing blockchain networks to vulnerabilities.

As the blockchain industry continues to evolve, it's essential for investors and stakeholders to stay informed about proposed changes and forks in their cryptocurrency holdings. 

Understanding the implications of hard forks and their potential impact on the value of crypto assets is crucial for navigating this rapidly changing landscape.

Remember, investing in cryptocurrency should be cautiously approached, especially for newcomers who are still learning how blockchain works. Stay updated, do thorough research, and seek professional advice before making investment decisions.

Disclaimer

The information provided on this website does not constitute investment advice, financial advice, trading advice, or any other advice, and you should not treat any of the website's content as such.

Token Metrics does not recommend buying, selling, or holding any cryptocurrency. Conduct your due diligence and consult your financial advisor before making investment decisions.

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→ Join the waitlist to be first to trade TM Global 100.

TL;DR (snippet)

  • What it is: Rules-based index that holds the top-100 in bull markets and moves to stablecoins in bear markets.

  • Why it matters: Weekly rebalances + transparent holdings and transaction logs.

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  • Next step: Join the waitlist to be first to trade TM Global 100.

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How the TM Global 100 Index Works (Plain English)

  • Regime switching:


    • Bull: Holds the top-100 crypto assets by market cap.

    • Bear: Exits to stablecoins until a bullish signal returns.

  • Weekly rebalancing: Refreshes constituents and weights to reflect current market-cap rankings.

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Soft CTA: See the strategy and rules.

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Step-by-Step: How to Get Early Access (Waitlist)

  1. Open the Indices hub: Go to Token Metrics Indices.

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  6. Launch day: We’ll email you. Connect (or create) the embedded wallet, review fees/slippage, and confirm.

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→ Join the waitlist to be first to trade TM Global 100.

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  • New to Crypto: Prefer transparent, auditable exposure with simple flows → Good starter allocation framework.

  • DIY Basket Builder: Tired of rebalance overhead and slippage → Index can replace heavy lifting.

  • Custody-Sensitive User: Want self-custody with clear logs → Embedded self-custodial wallet.

  • Fee-Aware Investor: Want to see costs upfront → Buy flow shows fees, gas, slippage estimates.

  • Global User: Multi-chain support helps meet you where you are → Check region availability at launch.

FAQs

What is a top crypto index?
A rules-based basket that tracks a defined universe—here, the top 100 assets by market cap—with transparent methodology and scheduled rebalancing.

How often does the index rebalance?
Weekly. Regime switches (tokens ↔ stablecoins) can also occur when the market signal changes.

What triggers the move to stablecoins?
A proprietary market-regime signal. In bearish regimes, the index exits token positions to stablecoins and waits for a bullish re-entry signal.

Can I fund with USDC or fiat?
At launch, the embedded wallet will surface supported funding/settlement options based on your chain/wallet. USDC payout is supported when selling; additional on-ramps may follow.

Is the wallet custodial?
No. It’s an embedded, self-custodial smart wallet—you control the keys.

How are fees shown?
Before confirming, the buy flow shows estimated gas, platform fee, max slippage, and minimum expected value.

How do I join the waitlist?
Visit the Token Metrics Indices hub or the TM Global 100 strategy page and tap Join Waitlist.

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  • Visibility: Gauge → Treemap → Transactions Log shows holdings and all changes.

  • Fee/slippage clarity: All estimates shown pre-trade; transaction logs post-trade.

  • Regime logic limits: Signals can be wrong; switching may lag sudden moves.

  • Region notes: Availability and funding paths can vary by region/chain and may expand over time.

Crypto is volatile and can lose value. Past performance is not indicative of future results. This article is for research/education, not financial advice.

Conclusion + Related Reads

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→ Join the waitlist to be first to trade TM Global 100.

TL;DR (snippet)

  • What it is: A rules-based index that holds the top-100 assets in bull markets and moves to stablecoins in bear markets.

  • Why it matters: Weekly rebalances + transparent holdings and transactions logs.

  • Who it’s for: Hands-off allocators and active traders who want a disciplined core.

  • Next step: Join the waitlist to be first to trade TM Global 100.

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Definition (for featured snippets): A top 100 crypto index is a rules-based basket that tracks the largest 100 crypto assets by market cap, typically rebalanced on a schedule to keep weights aligned with the market.

In 2025, that alone isn’t enough. You also need discipline for downtrends. TM Global 100 adds a regime-switching layer to move to stablecoins during bear phases—so you can participate in upside and sit out major drawdowns with a consistent, rules-based approach.

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How the TM Global 100 Index Works (Plain English)

Regime switching:

  • Bullish: The index holds the top-100 assets by market cap.

  • Bearish: The index exits positions and moves fully to stablecoins until a bullish re-entry signal.

Weekly rebalancing:

  • Every week, the composition and weights update to reflect current market-cap rankings. No manual list maintenance. No “oops, I missed the new entrant.”

Transparency:

  • Strategy modal explains selection criteria and regime logic.

  • Gauge → Treemap → Transactions Log shows the signal, the real-time holdings view, and every rebalance/regime switch.

  • You’ll always see what you own, how it changed, and why.

What you’ll see on launch:

  • Price tile, 100 tokens, “rebalances weekly,” and one-click Buy.

  • Gauge to visualize the market signal.

  • Holdings Treemap and Table to inspect exposure.

  • Transactions Log to review every rebalance.

Soft CTA: See the strategy and rules.

Benefits at a Glance (Why This Beats DIY)

  • Time saved: Skip hours of asset chasing and manual spreadsheets; rebalances happen automatically.

  • Lower execution drag: One index buy can reduce slippage vs. piecing together 20–50 small orders across chains.

  • Never miss a rebalance: Weekly updates and on/off risk switches run by rules, not vibes.

  • Rules-based switching: A clear trigger defines when to sit in stablecoins—no second-guessing.

  • Full visibility: The gauge, treemap, table, and log make the process auditable at a glance.

  • Operational simplicity: An embedded wallet, 90-second buy flow, fee and slippage estimates upfront.

Step-by-Step: How to Get Early Access (Waitlist)

  1. Open the Indices hub and tap TM Global 100.

  2. Join the waitlist with your email—this flags you for day-one access.

  3. (Optional) Connect your wallet so you’re ready for the embedded checkout.

  4. Launch day: You’ll get an email and in-app prompt when trading opens.

  5. Buy in ~90 seconds: Connect, review fees/slippage/estimated value, confirm.

  6. Track positions: See your holdings, rebalances, and P&L in My Indices.

  7. Repeat or add funds: Rebalancing is handled weekly; you can add or sell anytime.

→ Join the waitlist to be first to trade TM Global 100.

Decision Guide: Is This Right for You?

  • Hands-Off Allocator: Want broad market exposure without managing coin lists? Consider it.

  • Active Trader: Want a disciplined core you don’t have to watch while you chase setups? Consider it.

  • TM Member (Research-Heavy): Prefer to keep your picks, but want a market base layer? Consider it.

  • New to Crypto: Need transparency + clear rules? Consider it, with a small test first.

  • Hyper-Niche Maxi: If you only want 1–2 coins, an index may be too broad.

  • Short-Term Scalper: You may still benefit from a core allocation, but active trading stays your main driver.

  • Tax-/Jurisdiction-Sensitive Users: Check your local rules before investing.

  • Institutional Explorers: Looking for transparent rules, logs, and weekly governance? Worth evaluating.

FAQs

What is a top 100 crypto index?
A rules-based basket tracking the largest 100 assets by market cap, typically with scheduled rebalancing. TM Global 100 adds regime switching to stablecoins during bear markets.

How often does the index rebalance?
Weekly. In addition, if the market signal flips, the entire portfolio may switch between tokens ↔ stablecoins outside the weekly cycle.

What triggers the move to stablecoins?
A proprietary market-regime signal. When it’s bearish, the index exits tokens to stablecoins and waits for a bullish re-entry signal.

Can I fund with USDC or fiat?
On launch, funding options surface based on your connected wallet and supported chains. USDC payouts are supported when selling.

Is the wallet custodial?
The embedded wallet is self-custodial—you control your funds.

How are fees shown?
Before you confirm a buy, you’ll see estimated gas, platform fee, max slippage, and minimum expected value—all up front.

How do I join the waitlist?
Go to the TM Global 100 page or the Indices hub and click Join Waitlist. You’ll get notified at launch with simple steps to buy.

Security, Risk & Transparency

  • Self-custody: Embedded, self-custodial smart wallet; you control keys.

  • 2FA & device checks: Standard authentication best practices.

  • Fee/slippage transparency: All estimates are shown pre-trade; you confirm with eyes open.

  • On-chain visibility: Holdings, rebalances, and regime switches appear in the Transactions Log.

  • Rule constraints: Signals can be wrong; spreads and volatility can impact outcomes.

  • Regional considerations: Availability and tax treatment vary by jurisdiction.

Crypto is volatile and can lose value. Past performance is not indicative of future results. This article is for research/education, not financial advice.

Conclusion + Related Reads

A top 100 crypto index is the simplest path to broad market exposure—if it’s built with discipline. TM Global 100 combines transparent rules, weekly rebalancing, and a regime switch to stablecoins, so you can focus on your strategy while the core maintains itself.
Now’s the time to claim early access.
→ Join the waitlist to be first to trade TM Global 100.

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After a whipsaw year, many investors are asking how to stay exposed to crypto’s upside without riding every drawdown. Rules-based crypto indexing is a simple, disciplined answer: follow a transparent set of rules rather than gut feelings. The TM Global 100 puts this into practice—own the top-100 in bullish regimes, rotate to stablecoins in bearish regimes, and rebalance weekly. On top of that, you can see what you own in real time with a Holdings Treemap, Table, and Transactions Log. Less second-guessing, more process.

→ Join the waitlist to be first to trade TM Global 100.

TL;DR (snippet)

What it is: A rules-based index that holds the top-100 in bull markets and moves to stablecoins in bear markets—paired with transparent holdings and transaction logs.

Why it matters: Weekly rebalances and clear regime logic bring structure after volatile cycles.

Who it’s for: Hands-off allocators and active traders who want a disciplined core with visibility.

Next step: Join the waitlist to be first to trade TM Global 100.

Why Rules-Based Crypto Indexing Matters in October 2025

In a volatile cycle, emotion creeps in: chasing winners late, cutting losers early, or missing re-entry after fear. Rules-based crypto indexing applies consistent criteria—constituent selection, weighting, and rebalancing—so you don’t have to improvise in stress.

For readers comparing crypto index options, think of it as a codified playbook. A rules-based crypto index is a methodology-driven basket that follows predefined signals (e.g., market regime) and maintenance schedules (e.g., weekly rebalancing), aiming for repeatable behavior across cycles.

Featured snippet definition: Rules-based crypto indexing is a systematic approach that tracks a defined universe (e.g., top-100 by market cap) and maintains it on a fixed cadence, with explicit rules for when to hold tokens and when to de-risk into stablecoins.

How the TM Global 100 Index Works (Plain English)

  • Regime switching: When the market signal is bullish, the index holds the top 100 assets by market cap; when bearish, it moves to stablecoins until conditions improve.

  • Weekly rebalancing: Constituents and weights update weekly to reflect the latest market-cap rankings—capturing leadership changes without manual effort.

  • Transparency: A Strategy modal and Gauge → Treemap → Transactions Log show the signal, current mix, and every change recorded.

  • What you’ll see on launch: Price tile, “tokens: 100,” “rebalances weekly,” and a fast ~90-second Buy flow with fee/slippage previews.

See the strategy and rules. (TM Global 100 strategy)

Benefits at a Glance (Why This Beats DIY)

  • Time & operational drag: Skip juggling 20–100 tickers, wallets, and venues.

  • Execution quality: A single indexed flow can help reduce piecemeal slippage and duplicated fees.

  • No missed rotations: Weekly rebalancing and regime switching reduce the cost of being late to trends—or late to de-risk.

  • Always-on visibility: Holdings treemap + table + transactions log remove the black box.

  • Behavioral edge: Clear rules can limit panic sells and FOMO buys during turbulence.

  • Portfolio role: A disciplined core that you can complement with selective satellites.

Step-by-Step: How to Get Early Access (Waitlist)

  1. Open the Token Metrics Indices hub and select TM Global 100. (Token Metrics Indices hub)

  2. Click Join Waitlist and enter your email for launch-day access.

  3. (Optional) Connect your wallet so you’re ready to fund.

  4. On launch, review the Gauge → Treemap → Transactions to confirm the current mix.

  5. Tap Buy Index, review fees/slippage, and confirm (about 90 seconds end-to-end).

  6. Track your position and every weekly rebalance in My Indices and the Transactions Log.

→ Join the waitlist to be first to trade TM Global 100.

Decision Guide: Is This Right for You?

  • Hands-Off Allocator: Want broad market beta with an explicit de-risking rule. Consider if you resist micromanaging.

  • Active Trader: Prefer a disciplined core that moves to stablecoins in bears while you express edge with satellites.

  • Long-Term Believer: Seek systematic participation in leadership changes via weekly rebalancing.

  • Transparency-First User: Require auditable holdings and a transactions log—no black boxes.

  • Tax/Compliance Conscious: Prefer consolidated rebalances over many ad hoc trades.

  • TM Research Follower: Want to pair TM insights with a rules-based execution layer.

  • New to Crypto Baskets: Want to avoid building and maintaining a DIY index.

FAQs

What is a rules-based crypto index?
A methodology-driven basket that follows predefined rules for asset selection, weighting, and maintenance. In TM Global 100, that means top-100 exposure in bullish regimes and stablecoins in bearish regimes, with weekly rebalancing and full transparency.

How often does the index rebalance?
Weekly. This cadence refreshes constituents and weights to align with current market-cap rankings; separate regime switches can move between tokens and stablecoins.

What triggers the move to stablecoins?
A documented market signal. When it turns bearish, the index exits to stablecoins; when bullish resumes, it re-enters the top-100 basket.

Can I fund with USDC or fiat?
Funding options will surface based on your connected wallet and supported rails. USDC settlement on sells is supported; fiat on-ramps may be added over time.

Is the wallet custodial?
No. The embedded wallet is self-custodial—you control your keys and assets.

How are fees shown?
Before confirming a trade, you’ll see estimated gas, platform fee, max slippage, and min expected value—so you can proceed with clarity.

How do I join the waitlist?
Go to the Indices hub, open TM Global 100, and enter your email. You’ll receive a launch-day link to buy.

Security, Risk & Transparency

  • Self-custody by default: You control your wallet.

  • Defense-in-depth: 2FA/account security features and explicit transaction prompts.

  • Clear economics: Fee and slippage previews before you confirm.

  • Auditability: Holdings treemap + table + transactions log document every change.

  • Methodology limits: Regime logic may not capture every market nuance; weekly cadence can differ from intraday moves.

  • Regional availability: On-ramps and features can vary by jurisdiction.
    Crypto is volatile and can lose value. Past performance is not indicative of future results. This article is for research/education, not financial advice.

Conclusion + Related Reads

After a volatile cycle, the edge is process. TM Global 100 combines rules-based crypto indexing, weekly rebalancing, and full transparency so you can participate in upside and step aside during bears—without running your own spreadsheets. If that’s the core you’ve been missing, join the waitlist now.

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