Sidechain & Cross-Chain Technology
Revolutions in blockchain technology
The ASSEMBLE Protocol is a blockchain-based global point integration platform that exploits ASM utility tokens, whilst establishing a business ecosystem that can integrate, utilize existing points and miles with point providers, consumers and retailers.
Hello, dear readers! Today we’re going to take a look at sidechains and cross-chains. Sidechains are helping popular blockchains like Ethereum complete transactions much more quickly. Cross-chains are helping to connect different blockchains. Both of these technologies are expanding the blockchain ecosystem but in their own unique way. We hope this bit of information will be useful to you as you continue to explore blockchain technology.
Sidechain Technology
Sidechains are subchains that run parallel to the mainchain. Sidechains do not contain independent nodes but instead work by connecting their nodes to the existing mainchain.
Blockchain technology has scalability issues. In the case of Ethereum, only 15 transactions can be processed per second. Sidechain technology offers a solution to these issues and has already been widely used. Sidechains' greatest strength is increasing the speed of transactions. Since operations are distributed on each sidechain, processing efficiency increases, and depending on the desired use case, the necessary functions (such as speed and computational ability) are readily available. Due to these characteristics, sidechain technology is being used in a variety of commercial fields.
Sidechains use consensus algorithms like PoA, PoS, DPoS, and BFT. They can easily overcome the limitations of the mainnet since they have lower fees and a faster transaction processing time. Sidechains also act as a bridge between different cryptocurrencies. The performance of various cryptocurrencies can be upgraded if sidechains are used effectively. One of the main uses for sidechains is to exchange different blockchain tokens. There have been many attempts to connect different blockchains, such as Bitcoin and Ethereum, but creating bridges between cryptocurrencies has been the most successful thus far. Perhaps the most obvious way to connect cryptocurrencies is to modify the code of Bitcoin or Ethereum itself. However, since it is practically impossible to modify the entire code of another company’s blockchain, sidechains are used.
Cross-Chain Technology
As the name suggests, cross-chains play a role in connecting different blockchains. For example, cryptocurrencies such as Bitcoin and Ethereum cannot be connected to each other. Therefore, if you want to exchange Bitcoin for Ethereum, the most common way is to first exchange Bitcoin for fiat money and then buy Ethereum with that. However, this transaction process is quite inconvenient as it wastes a lot of time and money.
Instead, if you use a cross-chain that supports direct exchanges, transactions will be more convenient and efficient. Cross-chains act as intermediary bridges to help smooth the interoperation of transactions and exchanges between two cryptocurrencies. They make it possible to exchange different cryptocurrencies directly and connect between various blockchain platforms.
The Main Characteristics of Cross-Chain Technology
- It is much easier to make exchanges between two different cryptocurrencies, without complicated steps or procedures.
- When a transaction occurs between cryptocurrencies, there is no exchange of tokens, only data is transmitted.
- It increases the scale of a particular blockchain by connecting it to other blockchains.
That concludes our deep dive into blockchain technology. Now you are more familiar with the benefits of both sidechains and multi-chains. We think they will be very important in helping to bring blockchains to the mainstream business world. Thanks for stopping by!
