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What Is a ‘Sidechain’ and Its Purpose?

A separate blockchain linked to the main chain via a two-way peg, used to offload transactions and improve scalability.
Greeks.Live04.11.25

What Is a ‘Sidechain’ and Its Purpose?

A sidechain is a separate, independent blockchain that is connected to a main blockchain (parent chain) via a two-way peg. Its primary purpose is to improve the scalability and efficiency of the main chain by offloading transactions and processing them on the sidechain.

Assets can be moved between the two chains. This allows for faster transaction times and lower fees on the sidechain without compromising the security of the main chain.

In a Sidechain, How Is the Merkle Root Used for Inter-Chain Communication?
How Does the Two-Way Peg Mechanism Work for a Sidechain?
Define “Hedging” and How Derivatives Are Used for This Purpose
What Is the Purpose of ‘Maintenance Margin’ and When Is a Margin Call Triggered?

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