What is Sidechain?

A sidechain is an independent blockchain that runs parallel to a main chain and communicates with it through bridges. Unlike Layer 2 rollups, sidechains have their own validators and do not inherit the main chain's security.

How does Sidechain work?

A bridge contract on the main chain locks assets.
The sidechain mints equivalent wrapped assets.
Users transact on the sidechain at lower cost and higher speed.
To return funds, the sidechain burns wrapped assets and the bridge releases originals on Layer 1.

Why does Sidechain matter?

Sidechains offer greater flexibility and independence than Layer 2 solutions, enabling different consensus rules, token economics, and governance at the cost of weaker security guarantees.

Key features of Sidechain

Own validators and consensus mechanism
Does not inherit Layer 1 security
Assets transferred via bridge contracts
Faster and cheaper than Layer 1
Greater design freedom than rollups

Examples of Sidechain

Polygon is Ethereum's largest sidechain, hosting thousands of DApps with near-zero fees. Gnosis Chain and Immutable X are other sidechains optimized for different use cases.