Hard Fork Vs Genesis Chain: Terra Team Clears Air Around Debate

In an effort to clear confusion over the amended Terra Ecosystem Revival Plan 2, the Terra team on Monday gave an explanation. Following the recent collapse, the Terra ecosystem has been trying to come up with a revival plan.

As part of this, Terra had last week published an amendment to the proposal and made three major revisions taking into account community feedback. Increasing the genesis liquidity, introducing a new liquidity profile, and reducing the allocation for post-attack UST holders were the three changes.

New Plan Not A ‘Fork’

In contrast to popular belief that the revival plan proposed a fork of the existing chain, it is about creating a new one, the team said. In a tweet thread, the Terra team clarified,

“Recently, a few community members (including some from Terraform Labs) have referred to the proposed new blockchain in Prop 1623 as a “fork” as opposed to a genesis chain. The revival plan is not proposing a “fork” of the existing chain, but rather the creation of a new one.”

A fork refers to a change in a blockchain protocol that results in two blockchains. One blockchain follows the previous protocol and the other one follows the new version. The new chain shares all of its previous history with the original, it explained.

Terra Revival

The important distinction here is that a forked blockchain shares all of its history with the original chain. This feature is unlike the Terra 2.0 plan. A brand new blockchain Terra shall be created starting from genesis block 0 that will not share history with Terra Classic, as per the new plan.

The recent Terra ecosystem meltdown will go down as one of the biggest crashes witnessed by crypto investors. The crash wiped out around $40 billion within a week’s time, shaking the crypto market.

After the dramatic fall, crypto billionaire Mike Novogratz warned that individual crypto investors should have proper risk management in mind.