Steemit Crypto Academy Contest / S14W3 -Sidechains

A brief Introduction to Blockchain:

As someone who's new to both blockchain and Steemit, I've been exploring how everything works. It's kind of like figuring out a big digital highway, and Steemit is like this cool spot on that highway. I have been reading extensively online and digging through old posts of multiple users on this platform, some as old as 6 years ago. I think I have gone through countless posts, I have really lost count. In doing so, I have come across some very interesting revelations. But first of all, a layman's perspective on blockchain and Steemit in the form of a handwritten draft.

An overview of Steemit before digging into questionnaire:

Below is the overview of some of the pertinent terminologies for contextual understanding and for the engagement of this post.

Steemit is a decentralized social media platform that operates on the Steem blockchain. It is a cryptocurrency network designed to support social media and online content creation in the form of rewards through curation.

1. Multi-Token cryptocurrency Economy:

• Steemit utilizes a multi-token system consisting of STEEM, VEST (SP - Steem Power), and SBD.

• STEEM is freely transferable, VEST/SP measures wealth and influence on the platform, and SBD serves as a stable coin.

• SP and VEST have a technical distinction, with SP representing actual power and influence, while VEST is a unit of measurement. This differentiation encourages long-term commitment.

2. Technological Foundation:

Steem is built on Graphene technology, shared with BitShares. It generates new tokens with each block produced, enhancing the platform's functionality.

3. Consensus Mechanism:

• Steemit is unique in that it aims to reward users for their contributions to the platform, providing a financial incentive for content creators and curators. The platform uses a consensus mechanism called Delegated Proof-of-Stake (DPoS) to achieve faster transaction speeds and scalability.

• Unlike Bitcoin, a limited number of users known as witnesses, not everyone, can produce blocks.

4. Witness System in Steem:

Witnesses in Steem play a crucial role. Any Steem user can become a witness by setting up a witness node. Witnesses approve forks, publish price feeds for STEEM, and users can vote to elect them.

5. Witness Election and Block Production:

Users can vote for up to 30 witnesses. The top 20 witnesses, plus one random witness, are responsible for producing blocks on the Steem blockchain, ensuring the platform's stability and functionality.

ANWERING THE QUESTIONS IN CHALLENGE:

_Calibraint

SIDECHAIN IN CONTEXT OF BLOCKCHAIN:

• Sidechain: Auxillary blockchain connected to the main blockchain.
• Independence: Operates separately with its own rules.
• Two-Way Peg: Allows secure asset transfer between mainchain and sidechain.
• Specialization: Designed for specific functions, enhancing efficiency.
• Scalability: Offloads tasks from main blockchain, improving overall scalability.
• Innovation: Provides a sandbox for experimentation without impacting the main blockchain.

Importance of Sidechain in terms of

Scalability:

Scalability refers to the ability of a system to handle an increasing amount of work, such as a growing number of nodes and transactions, without compromising performance or efficiency.

In blockchain, a transaction is a record of asset or data transfer between participants, cryptographically secured and added to the immutable and decentralized ledger. The term is not confined only to the transfer of assets across the platform or from the platform to other exchanges. It has a broader implication.

Hence, transactions are fundamental to blockchain technology and are crucial for maintaining an accurate and transparent ledger of all activities on the blockchain.

The scalability challenges in transactions, therefore, stem from the increasing number of nodes and transactions in blockchain, particularly in major public blockchain applications like Steemit. These challenges manifest in several key aspects. Some of these are:

• Computational Load: Increasing Workload
• Resource Intensity: High Resource Requirements
• Performance Issues: Transaction Speed Lags
• Consensus Delays: Agreement Time Lag
• Storage Challenges: Growing Data Size

Advantages of sidechain in the light of criteria defined above:

• Scalability: One of the main advantages of integrating sidechains into the system! Implementing sidechains in Steemit could alleviate congestion on the main platform, enhancing transaction processing and overall performance by distributing some of the workload to separate chains. This means that not all transactions need to be processed directly on the main blockchain, reducing congestion and freeing up capacity for more critical operations.

• Flexibility: The autonomy of sidechains on Steemit would allow for experimentation with different consensus mechanisms and parameters, fostering innovation and customization in how content is rewarded and shared on the platform.

• Cryptocurrency Compatibility: If Steemit were to integrate multitoken cryptocurrency-compatible sidechains, it would enable a seamless transition for developers. They could deploy existing Steem-based applications or smart contracts on these sidechains, expanding the functionality and possibilities within the Steemit ecosystem.

Therefore, Sidechain logic is an efficient method to lower transaction fees on the main blockchain. It achieves this by grouping transaction details into larger chunks and processing them separately outside the main blockchain. This approach results in cost savings, making transactions more affordable by avoiding the need to record every single transaction detail directly on the main blockchain.

This heading provides answers to two main queries asked by in the questionnaire; differences in blockchain vs sidechain regarding scalability issues and how could sidechains be used to diversify functionality on the Steemit platform.

The Burning Question!
How could sidechains help attract new users and developers to the Steemit platform by offering improved functionality and reduced transaction costs?

I dug into the internet for this question, and after googling through many pages, I came to the conclusion that Steemit can draw in developers, investors, and businesses by using sidechains. Unlike mainnet blockchains that may lack certain processes and need big investments, sidechains offer a different and attractive option. With sidechains, Steemit can provide a solution for better workflow, more transparency, and secure partnerships in business groups. This makes Steemit a great choice for those wanting efficient, clear, and confidential collaborations.

Security Implications:

The only question that kept nagging me throughout the writing and compiling of this post is/was; the security implications of the sidechains. I'm torn between the two opinions provided by different articles.

On one hand, sidechains shoulder the responsibility for their own security, which means that any security breaches within a sidechain don't have a direct impact on the main chain. However, this autonomy introduces a potential drawback, as it may lead to additional security risks that need to be carefully managed.

It's crucial to recognize that the robustness of a sidechain is contingent upon its design and implementation. While sidechains can offer faster transaction times, it's imperative for them to implement and maintain proper security measures, consensus mechanisms, and governance structures. This dual perspective emphasizes the need for a balanced approach to ensure the security of both sidechains and the overall blockchain ecosystem.

Successful Implementation of sidechains:

Popular sidechains include:

• Polygon for Ethereum
• Rootstock for Bitcoin
• Binance Smart Chain (BSC)
• Hive engine, DLUX, SPKCC for Hive

Regarding Steemit, I have extensively researched the internet and past posts of Steemit users. However, I didn't find any concrete proof of a sidechain. A good friend informed me that there used to be a side chain called Steem Keychain in the past, but it is no longer available due to some unavoidable circumstances.

I remain optimistic about the possibilities and innovations that may unfold in the future, contributing to the continued growth and resilience of this platform.

---

---

My References:

• MDPI article
• MDPI article
• web page
• veteran Steemit user

Disclaimer: I have compiled this post based on my understanding after going through different materials and articles, according to my abilities. I have sited my sources of information. Please correct me if any information is incorrect or not up to date. This post is open to critical questioning and engagement.