A sidechain is a separate blockchain that runs parallel to the main blockchain (mainnet) but operates independently off-chain. It links to the main blockchain by a two-way bridge (sometimes called a peg), so they are synergistic. A sidechain is responsible for its own security and validation processes. They were built originally to solve the speed and scalability issues of the Bitcoin and Ethereum blockchains.
Ethereum.org lists these pros and cons
- Technology is well-established and benefits from extensive research and improvements in design.
- Support general computation and can run Ethereum-native dApps.
- Use different consensus models to efficiently process transactions and lower transaction fees for users.
- EVM-compatible sidechains allow dApps to expand their ecosystem.
- Trade-off some measure of decentralization and trustlessness for scalability.
- Uses a separate consensus mechanism and doesn’t benefit from Ethereum’s security guarantees.
- Require higher trust assumptions (e.g., a quorum of malicious sidechain validators can commit fraud).
Ethereum sidechains examples