Sidechains are independent blockchains that connect to the main blockchain via a two-way bridge.
Sidechains offer a third possible solution to the “The Scalability Trilemma”, but many do not consider them a Layer 2 scaling solution because they operate largely independent of the main blockchain.
Users lock their assets in the main chain and are given equivalent assets in the sidechain using the bridge. Users can use the sidechain assets until they are ready to reverse the bridge transaction to go back to the main chain.
Sidechains are responsible to design their own validation process, build their own infrastructure, and manage their own security. Sidechains can be highly compatible with the main chain so logic and applications can be ported over easily.
Sidechains can help scale main chain performance, but can also add features that are not available on the main chain, such as smart contracts or privacy for Bitcoin.
Sidechains tend to be more centralized and less secure than main chains so they require a lot of capital and technical expertise to get off the ground.
- Summary: The main chain can be seen as a highway and the sidechain can be seen as local roads, where cars can use bridges to get on and off the highway as necessary.
- Examples: Polygon and Rootstock
- Sidechain explanation by EthHub