Sidechains - Crypto Academy / S4W8 - Homework post for pelon53.

in hive-108451 •  3 months ago  (edited)


1.- Explain in detail the Sidechains with the use of ZK-Rollups.



Most blockchains faces congestion and scalability issues, aside from lack of scalable Blockchain as noticed in the proof of work consensus algorithm other factors include the numerous activities happening in the Blockchain. These congestions slows transactions speed and affects scalability. Take for example, Ethereum Blockchain with it's many Dapps and smart contracts is faced with such challenge.

To solve these rising problem in most Blockchain comes with the birth of sidechains. Sidechains are built as a layer 2 of an already existing Blockchain. It offers interoperability between the main Blockchain and the layer 2 Blockchain. Through smart contracts, transactions can be taken off chain from the main Blockchain and are completed in the layer 2 blockchains. Then compressed data of the transaction will be submitted back to the Blockchain. These process are known as rollups. With these practice, the main blockchain can experience laser congestion and become more scalable.

Rollups comes with the concept in which transactions can be taken out and done outside the blockchain ( in the layer 2) while the record of those transactions are submitted back to the main chain in the format of highly compressed data. This process ensures high transaction speed and scalability and at same time proves more secure than other layer 2 solutions. The layer 2 chains are therefore reliance on layer 1 and are secured by it.

Some rollups equally comes an option where data are made available off chain which requires that no data are posted back to the main chain. The advantage of this rollup solution is that great throughput are achieved but the bad sides is that is not that secure when compared to other solutions.

In all, A sidechain is the layer 2 Blockchain, it is a separate Blockchain attached to layer 1 chain, which is the parent. The two Blockchains has a two-way peg communication flow between them which allows for interchangeability of assets. Due to the growth in DEFi and dapps of Ethereum, many sidechains are built to decongest the network while providing better scalability. Some sidechains running on proof of stake consensus algorithm equally provide interoperability between two different consensus.

There are two types of rollups:
1: optimistic rollups and
2: Zero knowledge rollups

While the former are kind of multipurpose, the ZK rollups are used on exchange platforms.

The difference between this two rollups is the method of verification. Zk rollups require that cryptographic proofs are provided to verify that transactions are valid. Whenever a batch of transactions is submitted to the main chain, a validity proof is provided. Optimistic rollups do not act that way, it relies on the premise that people should act on good faith.


In ZK rollups, data are bundled to layer 2 chains for processing, a cryptographic validity proof is generated for each of the bundles and are submitted to the layer 1 as proofs. These determine and ensures that the transactions in the layer 2 chain are valid. Because what is submitted to the main chain is compressed data, It results in very significant data reduction in the main chain, low gas fees to mine blocks and lower transaction cost.

To generate a validity proof is a complex and time consuming exercise, this is a drawback for the ZK rollup solution. Another disadvantage is that Zk rollup chains are not designed for smart contracts. ZK rollups are not suited for general purpose apps.

On the other hand, ZK rollups are best suited for exchange activities which results in faster withdrawal.

An example of ZK rollups is Hermez.

Hermez is a ZK rollup developed by Iden3, the group that developed Circom and SnarkJS libraries. The protocol generates a kind of cryptographic proof known as SNARKs ( succinct non-interactiive argument of knowledge). The protocol is believed to have the capability of scaling 2,000 Ethereum transactions per second.

Hermez has announced a merger with another notable Ethereum sidechain platform polygon. The merger is believed to enhance further the operational capabilities of both blockchain.

2.- Explain the Liquid Network side chain


Just as most sidechains are built on Ethereum as layer 2 due to the many potential Etheruem chain holds, there are equally sidechains that are build to facilitate the trade of Bitcoin by Bitcoin exchangers and financial institutions, Such as the "Liquid Network" side chain.


The liquid network is a Bitcoin based sidechain that ensures faster and private transactions and at same time allows for issuance of digital assets. With liquid network Bitcoin can be moved between it's mainnet and the side chain through a variable 1 to 1 peg.

The network is built to facilitate faster Bitcoin trades. Participants include financial institutions, cryptocurrency exchanges, highvolume users, retail traders, OTC and more.
The platform is owned and managed by authorized member institutions.

Below image shows partners.

image source

image source

The liquid network excels it's competitors because of it's capability to facilitates larger transfers of assets. Again it does not require establishing trust with Bitcoin mainnet, however the parallel network is secured by all authorized members trusting each other.

The benefit of supplementing Bitcoin with liquid network is that it allows the main Bitcoin network remain secure, robust and private while it's infrastructure are used to support the parallel network.

The two networks in effect complements each other, bitcoin is secured by its consensus algorithm- proof of work which is not fast in completing transactions. The liquid network using the robust infrastructure of Bitcoin can achieve faster completion of transactions while being secured by strong partnership of authorized members.

  • Transactions are completed faster. Blocks times are achieved in minutes as against the ten minutes of Bitcoin mainnet.
  • Facilitates private transactions. Transaction asset types and it's amount are not made available made visible to third parties.
  • Issuance of new assets. Stable coin, security tokens, digital collectibles can be issued by anyone on liquid network.
3.- Describe the steps to connect the Metamask wallet and the Polygon network wallet. Show screenshots.


Follow below steps to connect metamask wallet and polygon network.

Step 1:

Download metamask wallet and create account. I already have a metamask wallet.

Open the wallet, click on the drop-down box at the left conner.
See image below.


  • Locate "settings"


  • Next locate "networks".


step 2:

Use below information to add polygon.

Network Name: Polygon
ChainID: 137
Symbol: MATIC
Block Explorer URL:


Then Finally


We have added the polygon to metamask

4.- According to the polygonscan block explorer, when will the block 25,000,000 be generated? Show screenshot. Explore the 12,000,000 block, at that time, what was the price of the Matic? Show screenshots.


Using polygon block explorer, we can dictate the time block 25, 000,000 will be generated as shown in the image below.


Just type in block 25,000,000 in the block explorer box.

Then the result will appear like below.

image source

Block 25,000,000 will be generated on -
Date: March 01, 2022
Time: 15:22:29 gmt-0800 ( pacific standard time)

Exploring block 12,000,000

Just like above method, simply key in the block in the block explorer box

image source

The block was created 226 days ago.

image source

The price of matic as at then was $0.38 USD.



Side chains refers to a different blockchain attached to a Blockchain usually to improve functionality of the main Blockchain.

Because of the potential Etheruem holds, many sidechains has been developed to solve congestion and scalability issues of Ethereum and at the same time solving the issue of high transaction fees due to gas. This side chains are built as a layer 2 of Ethereum. Transactions are bundled off the main chain to the layer 2. Upon completion of the transaction the records are submitted in a concise data to the main chain.

The two different types of rollups are the optimistic and zero knowledge rollups. While the optimistic enables smart contracts, Zk rollups are good and suited for exchanges.

ZK rollups provide validation proofs of every transaction bundles, on the other hand, optimistic do not make such provisions. It acts on trust.

Liquid Network is a parallel chain attached to Bitcoin network. It is secured by the the authorized members as it enables faster and large transactions as compared to it's competitors.

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