Don’t let syntax fool you: ‘Creative’ sidechain is basically a return to banking

As the bitcoin scaling conflict enters its fourth year, more and more “creative” solutions are popping up, complete with sensationalist headlines that oftentimes mislead readers into seeing vulnerabilities where none exist.

Case in point: Early this week, bitcoin developer and entrepreneur Jimmy Song posted an op-ed piece on Medium discussing how the sidechains project can empower developers and miners by allowing them to “try out new, riskier features” without the need “to get anyone’s approval for doing so.”

The piece, which CoinDesk reposted on its site, described sidechain as a separate blockchain where users can deposit and withdraw bitcoins, offering “all sorts of new features” but “won’t actually affect bitcoin.” This, Song wrote, is “the key” as it allows miners and developers to control separate, smaller domains that they could use according to their needs and desires.

A sidechain is essentially an off-blockchain service that allows bitcoin users to transfer the value of the cryptocurrency away from the bitcoin blockchain to avoid issues such as blockchain bloat. So far, two sidechain implementations have already been deployed: Blockstream’s Liquid, which still needs enough trusted entities, and Paul Sztorc’s Drivechain, which requires a soft fork where miners will have to validate new rules.