A sidechain (sidechain) is an independent blockchain that runs in parallel to the main network and is linked to it by an asset-transfer mechanism. The idea is to add new functionality or improve performance without overloading or rewriting the parent chain — for example, the Bitcoin network.

How it works

Assets move between the main network and the sidechain through a special locking and confirmation mechanism. While funds are engaged in the side chain, they are conditionally "locked" on the main network, and they are released upon return. This makes it possible to carry out operations under the sidechain's rules while maintaining a link to the base asset.

Sidechains give developers the ability to experiment with new financial ecosystems and features:

• test new rules and smart contracts;
• increase speed and reduce transaction costs;
• integrate additional services on top of the existing network.

The main difference between sidechains and fully independent cryptocurrencies is their reliance on already existing infrastructure. Instead of ignoring the base network, they aim to extend its capabilities while remaining technologically linked to the parent chain.