What is Sidechain? Sidechain is considered one of the extension solutions for Layer 1 but is not considered a true Layer 2. So what are Sidechains and why sidechains are not considered layer 2? Let’s answer in this article!
To better understand Sidechain, people can refer to some of the articles below:
- What is Layer 2? Complete Guide to Layer 2 Solutions
- What is Layer 1? The Importance of Layer 1 in the Crypto Market
What is Sidechain?
Sidechain is a separate blockchain with its own consensus mechanism that runs independently from Ethereum connected to Ethereum by a two-way bridge.
Sidechains do not post any of their information to Ethereum, so sidechains do not inherit security from Ethereum. Additionally, the two-way bridge only addresses the transfer of assets between Ethereum to the sidechain and vice versa.
Sidechain Characteristics
Consensus mechanism
Sidechains use a different consensus mechanism than Ethereum depending on the core team’s purpose of construction and use. Some commonly used consensus mechanisms on side chains include:
- Proof of Authority
- Delegated Proof of Stake
- Byzantine fault tolerance
At the present time, some popular sidechains such as BNB Chain, Polygon POS often use Proof of Authority, simply imagine this as a miniature Proof of Stake with the number of validators usually limited to 20 – 200 validators and These validators need to KYC with the core team.
Similar to validators on Ethereum, they are also in charge of processing, executing, agreeing and storing transactions on the blockchain.
EVM compatibility
Most sidechains are compatible with EVM (Ethereum Virtual Machine). Simply understanding the protocols on Ethereum written with Sodility, you can copy your code and paste it, plus tweak a few small elements, and you can immediately deploy it on the sidechain network.
However, it should be noted that there will be many different levels of compatibility, like 50%, 60%, 70%, 80%, 90%, 95%,… the higher the code, the less code that needs to be corrected.
Because sidechains often have faster transaction speeds and lower fees than Ethereum, sidechains and DApps on Ethereum often tend to expand to sideschain when it cannot find a place on Ethereum or multichain development. will help with implementation time and costs.
Sign away
Assets will be transferred between the two blockchains through a bridge, but the assets when going from Ethereum to the sidechain will no longer be that asset but are called wrapped assets. That is the mechanism of action of these blockchains. ordinary bridge.
For example: When you transfer ETH from Ethereum to BNB Chain you will receive the same amount of wETH.
Advantages & Disadvantages
|
Advantage |
Defect |
|---|---|
|
The speed is fast and the cost is many times cheaper than Ethereum. |
Trade off Security and Decentralization to expand the network. |
|
EVM compatible makes deploying DApps easier. |
Using its own consensus mechanism, it does not receive security from Ethereum. |
Summary
Sidechains do not inherit security and decentralization from Layer 1, so sidechains are not considered a Layer 2 solution. However, with EVM compatibility, sidechains also attract many projects and developers with the system. its ecology.
