What are the differences between sidechain and layer 2 in the context of cryptocurrencies?

1 answers

• Dec 27, 2021 · 3 years ago
  In the context of cryptocurrencies, sidechains and layer 2 solutions offer different approaches to addressing scalability and functionality challenges. Sidechains are separate chains that are connected to the main chain, allowing for the transfer of assets between them. This enables developers to experiment with new features and technologies without risking the security and stability of the main chain. Layer 2 solutions, on the other hand, are built on top of the main chain and aim to improve its performance and scalability. They use techniques like state channels and side channels to enable faster and more efficient transactions. While sidechains provide more flexibility, layer 2 solutions are generally more tightly integrated with the main chain and can offer better compatibility and interoperability with existing applications and infrastructure.
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