What Is the Difference between a State Channel and a Sidechain?

A state channel is an off-chain, two-way communication channel between two or more users that allows for near-instant, zero-fee transactions, with only the initial and final states being committed to the main chain. A sidechain is a separate, independent blockchain connected to the main chain via a two-way peg.

Transactions occur on the sidechain, and it has its own consensus mechanism. Sidechains offer greater scalability and flexibility but rely on their own security model.