Fork Policy

Introduction

Forks and airdrops raise questions about how Tungsten customers can expect to manage these events and what value may exist. Forks(protocol changes) and airdrops create unique technical, safety, liquidity, and timing challenges for custody. Tungsten treats Airdrops and Forks similarly. Tungsten will make responsible, informed decisions regarding accessing the value delivered via an Airdrop or a Fork. This document describes the problem and clarifies Tungsten’s policy on how to handle forks and airdrops.

Purpose

This Policy aims to maintain the blockchain network’s integrity, security, and efficiency by addressing critical aspects of protocol management, token distribution, and user security. This policy encompasses guidelines for managing Forks. It also includes provisions for Airdrops aimed at the fair and transparent distribution of tokens to promote network loyalty, marketing, and decentralisation while complying with regulatory standards. Overall, this policy is designed to ensure the blockchain operates smoothly, adapts to changes effectively, and safeguards the interests and security of its users and stakeholders.

Scope

Forks

Includes guidelines and procedures for both soft and hard forks, affecting all network nodes, developers, and stakeholders. It covers the decision-making process, implementation protocols, and communication strategies to ensure a seamless transition during upgrades or modifications.

Token Distribution (Airdrops)

The policy applies to issuing and distributing free tokens within the network. It outlines the eligibility criteria, distribution mechanisms, and compliance with legal and regulatory standards to ensure fairness and transparency.

Policy Statement

This Policy is dedicated to ensuring the integrity, security, and ongoing improvement of Tungsten’s operations within the blockchain networks. It encompasses a comprehensive approach to managing Forks, ensuring transparency to the network’s stability and stakeholder consensus. The policy also covers the equitable and transparent distribution of tokens through Airdrops, adhering to strict standards and fostering network engagement. Through this policy, Tungsten will maintain a resilient, fair, and secure environment for our clients.

Terms

Airdrop

An Airdrop marketing tactic involves sending coins or tokens to addresses to promote awareness of a new virtual currency. The new asset is sent to available addresses from another blockchain. The idea is that the holders of private keys are motivated to access the value of the new blockchain.

Fork

In virtual assets, a “fork” is a situation where the blockchain diverges. This divergence can be temporary, leading to the resolution and continuation of a single chain, or it can be permanent, splitting the blockchain into two distinct versions. When this happens, the blockchain effectively branches out like a road might fork into two paths.

Market Capitalization

Tungsten will only support a fork if its value globally is measurable on reputable exchanges at more than $100M.

Security

Tungsten’s primary goal is always security and safety. Tungsten will never introduce support for any fork where, at its sole discretion, it believes it may be unsafe to do so. 

Preservation of Value

Tungsten also intends to preserve value for customers. Tungsten will work with customers to deliver that new value when forks occur with significant value. This may or may not mean Tungsten can support the assets as a fully-featured wallet with all the security principles Tungsten generally tries to maintain. Tungsten may give customers tools to access and convert the virtual asset to another form.

Technical Stability

For Tungsten to support a fork, we look for clear indications of stability and safety. Tungsten makes mindful decisions, paying close attention to:

The team responsible for creating the fork
Evidence that the fork provides replay protection from the original fork
Evidence that the fork provides wipeout protection from the original fork
The strength of the new fork’s validating capacity

Liquidity

In addition to having sufficient market value, the new asset must have sufficient liquidity on reputable exchanges. Tungsten generally expects at least $25M of daily liquidity available on reputable exchanges for 30 days.

Cost

When Tungsten issues wallets for a virtual asset, Tungsten supports that asset and blockchain forever. Some forks are simple for Tungsten to support. Supporting the new virtual asset could be relatively easy when a fork is similar to the original. Technologically, different forks or airdrops are much more costly to support and maintain. If a new fork is costly but has sufficient value to Tungsten customers, Tungsten will use its best efforts to access the new virtual assets.

Timing

New airdrops and forks are usually introduced with some notification before the airdrop or fork occurs. However, sometimes, these notification periods can be just a few weeks. Tungsten cannot support new forks or airdrops within any short timeframe. Business obligations, developer availability, and cost are all material factors; safety, testing, quality, and service are our primary objectives. While Tungsten will do its best to make value available to its customers, we cannot guarantee a specific timeframe when the exact considerations of future forks can be so varied. Should a fork become viable, Tungsten may, at its sole discretion, elect to support the Fork or Airdrop.

Other Considerations

In an upcoming modification to the Bitcoin Network or other applicable blockchains that could result in a fork or airdrop, Tungsten will use its best commercial efforts to provide the value of the forked virtual asset to its customers. However, Tungsten’s first concern is always the security of the assets under management. At its sole discretion, Tungsten may or may not decide to make virtual assets available to its customers. Additionally, Tungsten may take significant time to implement or provide access to any virtual asset created due to a Fork. Customers indemnify Tungsten against any direct, indirect, incidental, special, or consequential losses due to the inability to access any virtual asset made due to a fork or airdrop.

Suppose Tungsten considers a fork technically safe with sufficient market value and liquidity. Still, customers desire access to the fork before the timing that Tungsten can provide due to cost or timing considerations. In that case, Tungsten will, in good faith with its clients, determine a product plan to enable clients to access the value of the fork or airdrop so that the client can access the coin at its sole expense. Any new asset will be subject to Tungsten’s Virtual Asset Acceptance Policy and Procedures.

Tungsten reserves the right to update this policy and the criteria for measuring the viability of a fork or airdrop from time to time based on new technological, legal, or environmental factors that may emerge.