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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Token Metrics Team

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AI Crypto Trading - How Token Metrics AI Helps You Catch Every Crypto Narrative Before It Pumps

Token Metrics Team
8 min
MIN

In crypto, narratives don’t just tell stories — they move serious capital.

Every few weeks, a new sector takes center stage. One day it’s memecoins. The next it’s AI tokens. After that, it's Real World Assets (RWAs), restaking protocols, or something entirely new. The constant cycle of hype and attention creates volatile capital flows that most traders struggle to keep up with. By the time you realize a narrative is pumping, you're often already late. The smart money has rotated, and you’re left holding the bag as exit liquidity.

This is where Token Metrics steps in with a powerful solution: AI-driven Portfolio Rotation based on real-time narrative performance.

Instead of relying on gut feeling or Twitter hype, Token Metrics uses real-time data, AI-powered grading, and predictive analytics to help you rotate your crypto portfolio into the right narratives at exactly the right time. It’s built for traders who want to consistently stay ahead of capital flows, and it’s already live for Premium users.

Let’s dive deeper into why narrative rotation matters, how Token Metrics tracks it in real-time, and why this AI-powered system is changing the way traders approach crypto markets.

Why Narrative Rotation Matters

If you’ve been trading crypto for a while, you already know one core truth: attention drives liquidity. And in crypto, attention shifts fast.

Whenever a new narrative gains traction — whether it's driven by a protocol upgrade, macroeconomic news, or simply viral social media posts — the capital starts flowing:

  • Venture capital firms pump their favorite tokens tied to the narrative.
  • Influencers and alpha groups amplify the hype.
  • Traders chase short-term momentum looking for fast gains.
  • Retail investors arrive late and often buy the top.

This cycle repeats over and over. If you’re not rotating early, you end up entering the trade just as early participants are exiting. The trick is not just identifying strong narratives — it’s recognizing when they start to heat up, and moving capital accordingly.

Narrative rotation allows traders to continuously reallocate their portfolio toward the sectors that are attracting fresh liquidity — and more importantly — exiting fading narratives before they reverse.

In traditional markets, this level of active sector rotation often requires hedge fund-level resources. In crypto, with its fragmented data and 24/7 markets, it's even harder to pull off manually. That’s where AI comes in.

How Token Metrics Tracks Narratives in Real Time

The Token Metrics team recognized that crypto traders needed a smarter, data-driven approach to narrative rotation. So they built an entire system that tracks sector performance dynamically — in real time — across hundreds of tokens and multiple narratives.

Here’s how it works:

  • Curated Narrative Indices: Token Metrics has built multiple AI-curated indices that group tokens into active narratives such as Top AI Tokens, Top Memecoins, Top RWAs, and more. Each index represents a distinct narrative, aggregating multiple projects into a single performance tracker.

  • Live ROI Tracking: Every index is continuously monitored based on 7-Day and 30-Day ROI metrics. This gives traders instant visibility into which narratives are starting to outperform and where capital is rotating.

  • Real-Time Bullish/Bearish Signals: The platform applies AI-powered bullish and bearish signals across individual tokens within each index. This helps you gauge not only sector-level momentum but also individual token strength.

  • Trader Grade Scoring: Every token within each narrative is also scored using Token Metrics’ proprietary Trader Grade, which ranks tokens by short-term momentum, volatility, liquidity, and AI-driven signal strength.

In short, instead of relying on your gut instinct or waiting for narratives to trend on crypto Twitter, you’re seeing clear, data-backed signals the moment narratives begin to heat up — and well before retail crowds arrive.

What is AI Portfolio Rotation?

The real breakthrough is AI Portfolio Rotation. This isn’t just a dashboard that shows you sector performance. Token Metrics goes a step further by actually generating actionable portfolio rotation recommendations based on live narrative performance.

The system works like this:

  1. Monitor Narrative Outperformance: The AI monitors all active narrative indices, tracking which sectors are outperforming based on short-term ROI, momentum signals, and Trader Grades.
  2. Rotate Exposure Automatically: As narratives shift, the system automatically suggests reallocating exposure into the narratives that are gaining momentum.
  3. Select Top Tokens: Within each narrative, only the top-scoring tokens — those with the strongest Trader Grades and bullish signals — are included in the recommended allocation.
  4. Exit Underperformers: If a narrative weakens, or signals turn bearish, the system exits positions and reallocates capital into stronger sectors.

It’s essentially an AI-powered quant fund operating on narrative rotation logic — continuously adapting your portfolio allocation based on capital flows across narratives in real-time.

For traders, it turns the chaotic, unpredictable world of crypto narratives into a structured, rules-based trading system.

Example From the Webinar: AI → Memes → RWA

During the recent Token Metrics Premium webinar, the team showcased how AI Portfolio Rotation played out in the real market over just a few weeks.

  • AI Tokens Surge: After new OpenAI product announcements, AI-related crypto tokens like FET, RNDR, and AGIX began to outperform, attracting attention from traders anticipating a broader AI sector pump.
  • Memecoin Mania: Shortly after, celebrity-driven memecoin launches flooded the market, pushing memecoins like PEPE, FLOKI, and DOGE into the spotlight. The narrative shifted hard, and capital rotated into these high-volatility assets.
  • Real World Assets (RWA) Take Over: As macroeconomic narratives around tokenized assets and on-chain treasuries gained momentum, the RWA sector surged. Tokens tied to tokenization narratives, like ONDO or POLYX, saw significant inflows.

By using Token Metrics’ AI-powered system, traders following the dashboard were able to rotate their portfolios in sync with these capital flows — entering hot narratives early and exiting before momentum faded.

Who Is This For?

AI Portfolio Rotation isn’t just for advanced quant traders — it's designed for a wide range of crypto participants:

  • Swing Traders: Rotate across hot sectors with clear, data-driven insights.
  • Fund Managers: Systematically allocate capital across outperforming narratives while minimizing guesswork.
  • Crypto Builders & Analysts: Monitor sector flows to understand broader market trends and build better macro narratives.
  • On-Chain Traders: Actively manage DeFi portfolios and liquidity positions with narrative-aware positioning.

The point is simple: narrative allocation beats token picking.

Most traders spend hours debating which token to buy, but often fail to recognize that sector rotation drives much larger price moves than token fundamentals alone — especially in the short-term crypto cycle.

Token Metrics vs. Guesswork

To really understand the edge this provides, let’s compare:

Feature                                                                               Token Metrics AI Rotation               Manual Research

Live Narrative ROI Tracking                                              ✅ Yes                                ❌ No

AI-Driven Rotation Logic                                                   ✅ Yes                                ❌ No

Trader Grade Filtering per Theme                                    ✅ Yes                                ❌ No

Bullish/Bearish Signals                                                      ✅ Yes                                ❌ No

Performance vs BTC/SOL/ETH Benchmarks                   ✅ Yes                                 ❌ Time-consuming

While manual research often leaves you reacting late, Token Metrics transforms narrative rotation into an objective, data-powered process that removes emotional bias from your trading decisions.

The Bottom Line

AI-driven portfolio rotation gives you the ultimate edge in fast-moving crypto markets.

Instead of constantly chasing headlines, Discord alphas, or social media hype, Token Metrics allows you to:

  • Instantly see which narratives are gaining momentum.
  • Automatically rotate into top-rated tokens within those narratives.
  • Exit fading narratives before the crowd even realizes the shift.

It’s a systematic, repeatable approach to trading the strongest sectors in real time. And most importantly — it allows you to profit from the same capital flows that move these markets.

In a space where being early is everything, Token Metrics’ AI Portfolio Rotation may be one of the smartest tools available for crypto traders looking to stay ahead of narrative rotations.

This isn’t just better data — it’s better positioning.

Announcements

Best Crypto API for Automated Trading: How Zapier and Token Metrics Help Crypto Traders Win

Token Metrics Team
8 min
MIN

Zapier is a no-code automation platform that lets you connect different apps and workflows using simple logic. With this integration, Token Metrics becomes one of the most powerful crypto APIs available for automation.

Now, you can instantly stream insights from the best crypto API into your favorite tools—whether you're managing a community in Discord, running a trading desk in Slack, or tracking token performance in Google Sheets.

Imagine automatically alerting your team when:

  • A token’s Investor Grade turns bullish
  • The Sharpe Ratio crosses a risk threshold
  • A new coin ranks in the top 10 AI indices
  • A project’s Valuation Score improves week-over-week

That’s just the beginning.

Building a Real-Time Crypto Market AI Bot on Discord

Let’s break down one of the most exciting use cases: creating a crypto AI assistant in Discord that delivers real-time token insights using Token Metrics and Zapier.

Step 1: Set Up Token Metrics API in Zapier

First, connect your Token Metrics account to Zapier and select your trigger. Zapier will display available endpoints from the Token Metrics API, including:

  • Indices Performance
  • Investor and Trader Grades
  • Quant Metrics
  • Valuation Scores
  • Support/Resistance Levels
  • Volatility and Risk Metrics

For this walkthrough, we’ll use the Quant Metrics endpoint and monitor the token Hyperliquid, a rising star in the market.

Step 2: Pass Token Data to OpenAI (ChatGPT)

Next, we use OpenAI’s ChatGPT node within Zapier to interpret the raw token data.

The Token Metrics API provides rich data fields like:

  • Sharpe Ratio
  • Value at Risk
  • Price Momentum
  • Drawdown
  • Volatility Score
  • Valuation Ranking

In the prompt, we pass these values into ChatGPT and instruct it to generate a human-readable summary. For example:

“Summarize this token's current risk profile and valuation using Sharpe Ratio, Value at Risk, and Price Trend. Mention whether it looks bullish or bearish overall.”

The AI response returns a concise and insightful report.

Step 3: Send the AI Summary to Discord

Now it’s time to publish your insights directly to Discord. Using Zapier’s Discord integration, you simply map the output from ChatGPT into a message block and post it in a channel of your choice.

The result? A clean, formatted message with up-to-date crypto analytics—delivered automatically in real time.

Use Case Expansions: More Than Just One Token

This workflow doesn’t stop at one token.

You can easily expand your automation to:

  • Monitor multiple tokens using separate Zaps or a lookup table
  • Set alerts for changes in Investor Grades or Valuation Scores
  • Summarize weekly performance of indices
  • Compare Trader vs Investor sentiment
  • Deliver price support/resistance alerts to Telegram, Slack, or email

Every piece of this system is powered by the Token Metrics crypto API, making it one of the most versatile tools for crypto automation on the market.

Why Token Metrics API is the Best Crypto API for Automation

When it comes to building crypto tools, bots, or dashboards, data quality is everything. Here’s what makes Token Metrics the best crypto API to plug into Zapier:

âś… Institutional-Grade Data

We use AI, machine learning, and quantitative analysis to score, rank, and predict token behavior across thousands of coins.

âś… Full Market Coverage

Track tokens across top L1 and L2 chains like Ethereum, Solana, Avalanche, Base, and more.

âś… Actionable Signals

Our API includes pre-calculated metrics like Bullish/Bearish Signals, Investor/Trader Grades, Risk Scores, and On-Chain Sentiment.

âś… Scalable & Modular

Pull exactly the data you need—from a single token’s valuation score to an entire index’s historical performance.

What You Can Build Using the Zapier and Token Metrics API

With this integration, developers, traders, and crypto communities can now build:

  • AI Discord bots that auto-analyze any token
  • Crypto trading dashboards in Notion or Google Sheets
  • Investor alerts via SMS, Slack, or Telegram
  • Weekly market reports sent to your email inbox
  • Risk monitors for portfolio managers
  • Auto-updating content for crypto blogs or newsletters

Zapier’s drag-and-drop interface makes it easy—even if you don’t write code.

Example Project: Community-Run Trading Assistant

Let’s say you’re running a Discord community around DeFi or AI tokens. With this integration, you can:

  1. Use the Token Metrics API to fetch daily Quant Metrics for trending tokens
  2. Pass them into OpenAI for summarization
  3. Auto-publish to a #daily-market channel with the latest signal summary

You now have a fully autonomous crypto analyst working 24/7—helping members stay informed and ahead of market shifts.

Start Building Today

If you’ve been looking for a crypto API that’s both powerful and flexible—Token Metrics is it. And with our new Zapier integration, you can bring those insights directly into the tools you already use.

➤ Ready to build your first crypto AI bot?

  1. Sign up at https://www.tokenmetrics.com/api
  2. Get your API key
  3. Connect to Zapier
  4. Automate your crypto intelligence in minute

Click here to view the demo!

This is the future of crypto trading: AI-powered, automated, and deeply personalized.

Final Thoughts

Crypto markets don’t sleep—and neither should your insights.

With the best crypto API now available through Zapier, Token Metrics gives you the power to build anything: bots, dashboards, trading agents, alert systems, and more.

Whether you're an individual trader, a Web3 builder, or a fund manager, this integration brings automation, AI, and crypto intelligence to your fingertips.

Let’s build the future of trading—together.

Announcements

AI Crypto Trading with Token Metrics Crypto API and OpenAI Agents SDK: The Future of Autonomous Crypto Intelligence

Token Metrics Team
8 min
MIN

Why This Integration Matters

Developer demand for high-fidelity market data has never been higher, and so has the need for agentic AI that can act on that data. Token Metrics delivers one of the best crypto API experiences on the market, streaming tick-level prices, on-chain metrics, and proprietary AI grades across 6,000+ assets. Meanwhile, OpenAI’s new Agents SDK gives engineers a lightweight way to orchestrate autonomous AI workflows—without the overhead of a full UI—by chaining model calls, tools, and memory under a single, developer-friendly abstraction. Together they form a plug-and-play stack for building real-time trading bots, research copilots, and portfolio dashboards that think and act for themselves.

A Quick Primer on the Token Metrics Crypto API & SDK

  • Comprehensive Coverage: Tick-level pricing, liquidity snapshots, and on-chain activity for thousands of tokens.
  • Actionable AI: Trader and Investor Grades fuse technical, on-chain, social, and venture-funding signals into a single score that beats raw price feeds for alpha generation.
  • Ready-Made Signals: Long/short entries and back-tested model outputs arrive via one endpoint—perfect for time-critical agents.
  • Instant Integration: Official Python and TypeScript SDKs handle auth, retries, and pandas helpers so you can prototype in minutes.

Because the service unifies raw market data with higher-level AI insight, many builders call it the token metrics crypto API of choice for agentic applications.

What Sets the OpenAI Agents SDK Apart

Unlike prior frameworks that mixed business logic with UI layers, the Agents SDK is headless by design. You write plain TypeScript (or JavaScript) that:

  1. Defines tools (functions, web-search, file search, or external APIs).
  2. Describes an agent goal and supplies the tools it can call.
  3. Streams back structured steps & final answers so you can trace, test, and fine-tune.

Under the hood, the SDK coordinates multiple model calls, routes arguments to tools, and maintains short-term memory—freeing you to focus on domain logic.

Bridging the Two with the Crypto MCP Server

Token Metrics recently shipped its Crypto MCP Server, a lightweight gateway that normalises every client—OpenAI, Claude, Cursor, VS Code, Windsurf, and more—around a single schema and API key. One paste of your key and the OpenAI Agents SDK can query real-time grades, prices, and signals through the same endpoint used in your IDE or CLI.

Why MCP?
Consistency—every tool sees the same value for “Trader Grade.”
One-time auth—store one key, let the server handle headers.
Faster prototyping—copy code between Cursor and Windsurf without rewriting requests.
Lower cost—shared quota plus TMAI staking discounts.

In fewer than 30 lines you’ve built a self-orchestrating research assistant that pulls live data from the best crypto API and reasons with GPT-4o.

Architecture Under the Hood

  1. Agent Layer – OpenAI Agents SDK manages state, reasoning, and tool routing.
  2. Tool Layer – Each Token Metrics endpoint (prices, grades, signals) is wrapped as an Agents SDK tool.
  3. Data Layer – The MCP Server proxies calls to the Token Metrics REST API, unifying auth and schemas.
  4. Execution Layer – Agents call the tools; tools call MCP; MCP returns JSON; the agent responds.

Because every piece is modular, you can swap GPT-4o for GPT-4.1, add a DEX trading function, or stream outputs to a React dashboard—no core rewrites required.

Performance & Pricing Highlights

  • Free Tier: 5 000 calls/month—ideal for proof-of-concept agents.
  • Premium Tier: 100 000 calls/month and three-year history, unlocking AI Agent endpoints for production workloads.
  • VIP: 500 000 calls/month and unlimited history for institutional desks.

OpenAI usage is metered per token, but the Agents SDK optimises context windows and tool invocations, often yielding lower compute cost than bespoke chains.

Roadmap & Next Steps

Token Metrics is rolling out first-party TypeScript helpers that auto-generate tool schemas from the OpenAPI spec, making tool wrapping a one-liner. On the OpenAI side, Responses API is slated to replace the Assistants API by mid-2026, and the Agents SDK will track that upgrade.

Ready to build your own autonomous finance stack?

  1. Grab a free Token Metrics key → app.tokenmetrics.com
  2. Clone the Agents SDK starter repo → npx degit openai/agents-sdk-starter
  3. Ship something your traders will love.
  4. Watch demo here

The synergy between the Token Metrics crypto API and OpenAI’s Agents SDK isn’t just another integration; it’s the missing link between raw blockchain data and actionable, self-operating intelligence. Tap in today and start letting your agents do the heavy lifting.

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