Do you know what a Sidechain is and what are they for?

Perhaps it has ever happened to you that your computer starts to work more slowly, applications "freeze" and some may even start to give errors, Internet browsing becomes slower and even the same startup process takes longer than normal. While this can be due to many reasons, one of them is insufficient RAM or what is the same, the computer is saturating with information that it cannot process with the same speed as before.

Although I am not a computer technician, so forgive me if my example has some flaws, what I wanted to graph is that when a system begins to have more requirements than it can meet, its processing tends to be each time slower, making tasks more and more complicated.

Something similar happens in the blockchain environment, when a certain network begins to process more and more transactions than were planned, information processing becomes increasingly slow, which in turn increases processing costs, " feed ”or“ gas ”. This situation can affect the scalability and sustainability of the platform, let's look at one of the alternatives, developed within the blockchain environment itself, to solve such an important problem: Sidechains.

What is a Sidechain?

If we think of a blockchain as an information highway, the sidechains would become a parallel highway, which at some point along the way exchange traffic with the first one. As the main blockchain (Layed 1) is overwhelmed by the intense traffic, it is necessary to create an alternative route or blockchain (Layed 2) that allows processing part of the operations that otherwise would have ended up in Layed 1, worsening the "Bottleneck" in it.

Thus we have that the Sidechains is a second layer blockchain designed to improve the performance of the main blockchain, this is achieved through sophisticated mathematical techniques, cryptography, algorithms, and the use of smart contracts that allow both networks to interact in a way such that Layed 2 can process operations, which, otherwise, would have had to be resolved within the main blockchain.

Why are Sidechains necessary?

As we mentioned in the example of the computer with which we started this publication, as the requirements to the system increase, in this case to the blockchain, it must have more and more processing capacity, although this is considered when developing the project, reality can often exceed expectations.

A clear example of the above is the Ethereum network, the development of its protocols or tokens ERC-20, ERC-223, ERC-721, and ERC-1115 are the fundamental basis of different DApss, such as Decentralized Exchanges (DEX), Decentralized Finance (De Fi), Play to Earn Games or NFTS's to give an example, it is not then, seeing the great boom that this type of platform has experienced in recent years, to understand the need to "unburden" the network that has been considered as the "great blockchain computer".

How does a sidechain work?

For it to work, the first thing a sidechain must do is a block, at a specific address, a certain amount of funds (cryptocurrencies) obtained from the main blockchain, and then issue the same number of tokens within a said blockchain, such as the L-BTC of the Sidechain Liquid, in this way you can pay the fees and make exchanges within the sidechain without affecting the Layed 1.

After the above, a consensus protocol is established that allows the operation of Layed 2, it must be faster and more efficient than the one used by the main blockchain, such as replacing the PoW with the PoS, as well as being developed cryptographic models, governance and smart contracts that will govern the operation of Layed 2.

Finally (it is not that they have a predefined order), the mechanisms that will allow the interaction between both blockchains (Layed 1 –Layed 2) are developed, among them we have: the payment channel networks (Lightning Network), the Plasma framework ( Plasma Framework) and Rollups. For this interaction to be efficient, the Layed 2 is in charge of processing millions of operations within its network, but when transferring said information to the main network, it condenses it into a single operation.

Why are sidechains so important?

Given the undeniable exponential growth of Dapps today, it is more than evident the need for “second layer” solutions that allow not only to alleviate the workload of the main networks, but also to reduce the operating costs of the same and improve the scalability of blockchain projects, this means that these types of solutions have not only earned their space in the crypto market, but also offer a lot of potential for the future.

That is why, when investing, we must not stop putting our eyes on projects such as Liquid Network, RSK, Lisk, or Polygon (Matic), for example. I would like to know your opinion. What do you think of this type of project? Would you invest in them? Do you think they have future potential? I hope to read you in the comment box.

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