Bitcoin sidechains were proposed in 2014 to create a secure and innovative development environment. They allow diverse blockchain systems to operate independently while interacting with the main Bitcoin blockchain. Sidechains have two critical components: a peg that enables the transfer of coins and a consensus mechanism that governs their operations. The original Blockstream design suggested using merge mining to leverage existing Bitcoin miners' work, fostering collaboration and innovation across different blockchains.
The original concept of a Bitcoin sidechain was proposed by Blockstream founders in 2014, aiming to enable liberal development without compromising Bitcoin's security.
Sidechains encompass diverse systems and can vary widely, essentially acting as other blockchain systems, similar to various altcoins.
Sidechains consist of two primary components: a peg for transferring coins and a consensus mechanism for block creation and transaction rules.
The 2014 Blockstream proposal introduced merge mining to allow sidechains to utilize Bitcoin miners' work efficiently while maintaining security.
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