<p>A side chain is a blockchain that runs parallel to the main bitcoin blockchain and can synchronize with it directly, allowing decentralized value transfer between the two chains. A user is able to essentially lock up a certain amount of coin on the main bitcoin block chain which then frees up an equivalent amount of coin on the side chain. This side chain may be either a sidechain compatible altcoin or just some test ground for new Bitcoin features. The coin that was transferred to the side chain can be returned back to the main bitcoin blockchain at any time. The value transferred back will be the same as the value transferred out.</p>

CC BY-SA 3.0
2014-04-30T14:35:58.863Z
This is the kind of thing I've been hearing about side chains. Thanks for the info! Here is what really confuses me, how does the value transferred out of bitcoin make it back to bitcoin, is this dependent on the side chain's exchange rate? I have heard "atomic swapping" is a method but this can be used for anycoin to anyothercoin, and is not in itself a way to store coins.
Mark
CC BY-SA 3.0
2016-01-21T15:46:51.660Z
See http://blockstream.com/sidechains.pdf (Disclaimer: I'm a co-author of the paper).
Pieter Wuille
CC BY-SA 3.0
2014-04-29T03:42:38.973Z
2014-04-29T03:42:38.973Z
Vance Cagle
<p>Sidechains are chains which allow 2-way peg, that is, moving bitcoins to the sidechain and then back to the main chain without trusting any third party, like you do, for example, when you move Bitcoins to say, Ripple (there you have to trust Bitstamp or another gateway). As such, there's no sidechain in existence, simply because the technology has not been implemented yet.</p>

<p>2-way peg is orthogonal to merged mining (you can do each of them separately or both). It is generally assumed that a sidechain would have merged mining because the bitcoin wizards designing sidechains accept that merged mining is generally desirable because of its superior security properties.</p>

<p>Compared to atomic swapping, 2 way peg is much slower but it doesn't require a counterpart that wants to move coins in the other direction.
So when sidechains are implemented, it is likely that most of the transfers are done with atomic swapping and only the first movements are done with 2 way peg, which is mostly there as a last resort in case you can't find someone else that wants to move the same quantity in the opposite direction.</p>

<p>Here are more details on how 2-way peg works:</p>

<p><a href="https://bitcoin.stackexchange.com/questions/24549/how-is-a-side-chain-merging-back-to-bitcoin-chain-protected-against-double-spend">How is a side-chain merging back to Bitcoin chain protected against double-spend? Where are the side-chain mining fees?</a></p>

CC BY-SA 3.0
2014-05-24T09:53:49.347Z
2014-05-24T09:53:49.347Z
2017-04-13T12:47:33.610Z
jtimon
<p>People have been talking a lot about side chains, but I thought this has been around for a while under a different name. Coins like Namecoin, Devcoin, ixcoin, i0coin, groupcoin, etc are all merge mined and have existed long before I ever heard the term "Side Chain". </p>

<p>Am I correct in my assumption that side chains are just a rose by another name (previously merge mined coins)? Or is there something I am missing here?</p>

CC BY-SA 3.0
2014-04-13T19:02:33.843Z
Perhaps I shouldn't have mentioned China, as it is indeed unrelated. I will remove this, but still I don't understand how sidechains work and will be implemented. From what I've read it seems like merge mining but why not just call it that? Some examples of how new side chain coins will work (if they are already in existence) or links to whitepapers explaining this will be much appreciated :)
Mark
CC BY-SA 3.0
2014-04-13T19:05:55.373Z
Also Feathercoin forks from Litecoin blockchain, so would this be a side-chain? I am looking for a clear definition of what is an alt chain or would like to know if it's just a buzz word which is being used with multiple meanings.
Mark
CC BY-SA 3.0
2014-04-14T16:41:24.140Z
It will help if you provide links to the places where this term is being used. Without context it is difficult to narrow down what this relates to. Sidechains could refer simply to shorter chains than the main blockchain (orphaned blocks) or parallel chains that will get partial mining reward in coins that use the uncle/nephew family tree reward system, or even forks into new coins, from your last comment. Not every use of a term is with its widely accepted meaning, so in the context you saw it we don't know exactly what was meant unless we look at it in place.
trichoplax is on Codidact now
CC BY-SA 3.0
2014-04-14T16:53:55.047Z
Is this related to [this question on sidechains](http://bitcoin.stackexchange.com/questions/24549/how-is-a-side-chain-merging-back-to-bitcoin-chain-protected-against-double-spend)?
trichoplax is on Codidact now
CC BY-SA 3.0
2014-04-14T19:30:57.520Z
I've been reading a lot on Reddit (please see http://www.reddit.com/r/Bitcoin/search?q=sidechain&sort=top&restrict_sr=on ) about sidechains. You're right I should have included links, but I have not been able to find two articles which make the same claim about "side chains" I really have no idea what it means except that it somehow relates to bitcoin. I am hoping someone can explain how this innovation is different than merge mining.
Mark
<merged-mining><sidechains>
Are sidechains really new?
Mark
# Are sidechains really new?

(Asked by: username_0 on 2014-04-13)

People have been talking a lot about side chains, but I thought this has been around for a while under a different name. Coins like Namecoin, Devcoin, ixcoin, i0coin, groupcoin, etc are all merge mined and have existed long before I ever heard the term "Side Chain".

Am I correct in my assumption that side chains are just a rose by another name (previously merge mined coins)? Or is there something I am missing here?

**Tags:** merged-mining, sidechains

> **Comments:**
> **username_0**: Perhaps I shouldn't have mentioned China, as it is indeed unrelated. I will remove this, but still I don't understand how sidechains work and will be implemented. From what I've read it seems like merge mining but why not just call it that? Some examples of how new side chain coins will work (if they are already in existence) or links to whitepapers explaining this will be much appreciated :)  
> **username_0**: Also Feathercoin forks from Litecoin blockchain, so would this be a side-chain? I am looking for a clear definition of what is an alt chain or would like to know if it's just a buzz word which is being used with multiple meanings.  
> **username_1**: It will help if you provide links to the places where this term is being used. Without context it is difficult to narrow down what this relates to. Sidechains could refer simply to shorter chains than the main blockchain (orphaned blocks) or parallel chains that will get partial mining reward in coins that use the uncle/nephew family tree reward system, or even forks into new coins, from your last comment. Not every use of a term is with its widely accepted meaning, so in the context you saw it we don't know exactly what was meant unless we look at it in place.  
> **username_1**: Is this related to [this question on sidechains](http://bitcoin.stackexchange.com/questions/24549/how-is-a-side-chain-merging-back-to-bitcoin-chain-protected-against-double-spend)?  
> **username_0**: I've been reading a lot on Reddit (please see http://www.reddit.com/r/Bitcoin/search?q=sidechain&sort=top&restrict_sr=on ) about sidechains. You're right I should have included links, but I have not been able to find two articles which make the same claim about "side chains" I really have no idea what it means except that it somehow relates to bitcoin. I am hoping someone can explain how this innovation is different than merge mining.  

---

## 2 answers

### Answer by username_2 on 2014-04-29. Score: 3

A side chain is a blockchain that runs parallel to the main bitcoin blockchain and can synchronize with it directly, allowing decentralized value transfer between the two chains. A user is able to essentially lock up a certain amount of coin on the main bitcoin block chain which then frees up an equivalent amount of coin on the side chain. This side chain may be either a sidechain compatible altcoin or just some test ground for new Bitcoin features. The coin that was transferred to the side chain can be returned back to the main bitcoin blockchain at any time. The value transferred back will be the same as the value transferred out.

> **Comments:**
> **username_0**: This is the kind of thing I've been hearing about side chains. Thanks for the info! Here is what really confuses me, how does the value transferred out of bitcoin make it back to bitcoin, is this dependent on the side chain's exchange rate? I have heard "atomic swapping" is a method but this can be used for anycoin to anyothercoin, and is not in itself a way to store coins.  
> **username_3**: See http://blockstream.com/sidechains.pdf (Disclaimer: I'm a co-author of the paper).  

---

### Answer by username_4 on 2014-05-24. Score: 1

Sidechains are chains which allow 2-way peg, that is, moving bitcoins to the sidechain and then back to the main chain without trusting any third party, like you do, for example, when you move Bitcoins to say, Ripple (there you have to trust Bitstamp or another gateway). As such, there's no sidechain in existence, simply because the technology has not been implemented yet.

2-way peg is orthogonal to merged mining (you can do each of them separately or both). It is generally assumed that a sidechain would have merged mining because the bitcoin wizards designing sidechains accept that merged mining is generally desirable because of its superior security properties.

Compared to atomic swapping, 2 way peg is much slower but it doesn't require a counterpart that wants to move coins in the other direction.
So when sidechains are implemented, it is likely that most of the transfers are done with atomic swapping and only the first movements are done with 2 way peg, which is mostly there as a last resort in case you can't find someone else that wants to move the same quantity in the opposite direction.

Here are more details on how 2-way peg works:

[How is a side-chain merging back to Bitcoin chain protected against double-spend? Where are the side-chain mining fees?](https://bitcoin.stackexchange.com/questions/24549/how-is-a-side-chain-merging-back-to-bitcoin-chain-protected-against-double-spend)


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