Sidechain – Blockchain

Sidechain is a method of separation blockchains. Instead of using only primary blockchain, a user now can transfer his digital assets to a supplemented one.


How does the sidechain work?

Sidechain explained

The process consists of several stages and takes some time:

  • The first part – sending. A user takes his coins and transfers them to a special certain address, where they become inaccessible for the original owner.
  • The second part – waiting for confirmation. The transfer of assets may be completed, but the user needs to wait for official statement. The process may take a certain amount of time, but it’s necessary for the protection of assets.
  • The third part – using a new sidechain. After the confirmation, the coins are released in the sidechain. Their amount is identical to the original. From now on, the user is ready to work with his assets.

The sidechain is connected to the main chain with the two-way peg. The sidechain can work with different types of digital assets. A user can change them by transferring them from main chains to sidechains and vice versa.

Sidechain’s Advantages and Disadvantages


  • Flexibility. The sidechain improves the speed of transactions and brings different types of cryptocurrencies closer. A user can mix, test them before the transactions, change them from the primary chain to a sidechain and vice versa. An owner of digital assets becomes freer in his actions.
  • Possibilities for experiments. The sidechains can be widely used in testing core software updates or any blockchain related software. This holds the potential for future technologies.
  • Federations. This group defines the state of used coins in the sidechain: if they are ready to access and transfer, or not. It is the only level between the main chain and one of its sidechains. Basically, it’s the additional control level, but the makers of the sidechain are free to choose participants for federation themselves.
  • Decentralized web. The sidechain technology holds premises to expand one of the main values of the blockchains – the decentralization of confidence. There is no need for central structure behind the transactions – the holders of cryptocurrencies are free to use their assets the way they want. The sidechains make their deals even more protected and reliable.


  • Security issues. Like the blockchain, the sidechain needs the work of miners to stay safe from attacks. Without sufficient power, the sidechain is vulnerable for assault. If hacked, only the sidechain will be damaged, while the main chain remains untouched and ready to continue work. If the main chain comes under the attack, the sidechain still operates, but without the value of the peg.

Sidechain Current Platforms

These are various platforms for blockchain, which operate with sidechains for a faster speed of transactions and payments. First, Ardor’s blockchain uses this method of separation, but the authors call it differently: childchains instead of sidechains. Secondly, RSK.

See Also on BitcoinWiki