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What is Sidechain?

A sidechain is a distinct blockchain network that is linked to the mainnet or parent blockchain by a two-way peg.

Digital assets or tokens can be transferred between sidechains and the main blockchain with the help of two-way pegs. A locking mechanism is used to transfer assets or currencies from the mainnet to the sidechain. As a result, the assets cannot be used up before the deal is complete.

The potential of sidechains to address the scalability issues with blockchains is arguably one of its greatest advantages. Sidechains make it possible to handle more data without running the risk of network slowdowns or breakdowns by boosting transaction capacity. They also lower transaction costs. This makes it easier for blockchain technology to develop into a widely used solution in the future.

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