Thread by @mt_1466

1/ Previously, I covered #L222 zk-rollup projects Starkware and zkSync but looking back, I should have begun with sidechains.

The who, what, why/why NOT, security guarantees, etc.

So, here's a 🧵 discussing sidechains generally and then a bit on #Polygon

2/ In the context of #Ethereum, sidechains are separate, Ethereum-compatible blockchains. Sidechains can be independent #EVM -compatible blockchains as well as application-specific blockchains catering to #ETH users and use cases like @0xPolygon or @Ronin_Network .

3/ Sidechains design themselves to be EVM-compatible so they can essentially copy and paste their code to easily interoperate with Ethereum and all of its infrastructure including wallets, block explorers, and more.

4/ Users send their L1 funds by way of a cross-chain transfer (bridge) enabled by a two-way peg (2WP) protocol that locks the assets on the L1 chain, then creates/mints an equal amount on the sidechain.

This can be quite dangerous! As we've learned recently! @wormholecrypto

5/ This means that $ETH that has been bridged over to a sidechain is simply an IOU and the user no longer has the security guarantees of the ETH L1. Sidechains have their own security model and, oftentimes, are far less mature and far less secure than Ethereum’s.
@jumpcapital

6/ If users had funds on a sidechain and the network went down (like #Solana in Q4 2021), there is nothing a user can do and their funds are stuck until the chain is brought back online.

7/ Additionally, if the bridge between two chains is compromised (again, like on #Solana, sorry to pick on #SOL), users could stand to lose funds.
@samczsun @gf_256 @ret2jazzy @CertusOne

8/ Some sidechains are purposely built to be complementary to Ethereum and can increase the #scalability of ETH by serving as external execution layers for L1.

However, it's important to remember that sidechains do NOT provide the same amount of security as ETH L1.
@sassal0x

9/ #Polygon : everyone's favorite ETH L2/sidechain/scaling ecosystem/commit chain/whatever 😉

Technically, @0xPolygon is its own blockchain (with its own token: $MATIC) but was built to become Ethereum’s internet of blockchains. It has become quite popular!
@0xPolygonToday

10/ Polygon provides the architecture that enables developers to create custom, application-specific chains that leverage Ethereum’s security similar to the @cosmos hub-and-spoke model.

It still supports many of the popular ETH dApps all while having much lower fees than L1 ETH

11/ It provides an interoperable layer that can bridge many different projects and scaling solutions such as #ZKRollups , #optimisticrollups, and #sidechains which supports the growth and modular expansion of the Ethereum ecosystem. @sandeepnailwal

12/ Since Polygon is a separate chain, it must be secured by a separate #ProofOfStake consensus mechanism where validators stake #MATIC .
MATIC is staked in smart contracts on the ETH L1. Polygon connects to Ethereum through a bridge with the use of a lock and mint mechanism.

13/ Users deposit funds into the #bridge which locks them in a smart contract on ETH &nmints the equivalent amount on Polygon. Polygon also maintains a secure relationship with the ETH L1 through periodic checkpointing, posting state changes to Ethereum, e.g. “commit chain.”

14/ The bridge (and funds) are secured by a 5/8 multisig scheme making it FAR MORE CENTRALIZED than the ETH L1.

This centralization factor should weigh heavily on your decision(s) when moving off L1.

docs.polygon.technology/docs/faq/commi…

16/ Just in Dec 2021, a whitehat hacker discovered a vulnerability in Polygon that left ~9B MATIC at risk. The hacker reported the issue and it has since been fixed with no loss of funds. However, it serves as a reminder of the risk involved in these new scaling solutions.

17/ Beyond @0xPolygon PoS chain

In Q2 2021, Polygon released the Polygon SDK, developer tooling for launching new blockchains as rollups or their own chain, and Avail, a data availability innovation for Polygon chains.

polygon.technology/solutions/poly…

18/ In Aug 2021, Polygon bought & acquired @0xPolygonHermez , zk-SNARK scaling solution, for $250M. The existing $Hermez tokens were rolled into MATIC post-acquisition. MATIC now allows network coordinators to earn the right to process txs in a permissionless auction system.

19/ Currently, Hermez is not EVM-compatible but, according to its roadmap, a V2 is in the works to make it fully EVM-compatible.

20/ In Nov 2021, Polygon announced another purchase of a scaling project, @0xPolygonMiden, a ZKrollup implementation using zk-STARKS.
Miden is already EVM-compatible & aims to guarantee “ETH-compatibility” by directly compiling Solidity-written SC into Miden VM’s native language

21/ @0xPolygonMiden is led by @bobbinth , a former core ZK researcher at #Facebook. Additionally, in contrast to Starkware’s #StarkNet , Miden is fully open-sourced off the bat.

22/ Finally, in Dec 2021, Polygon made another crypto-acquisition, this time purchasing the ZK-rollup project, @MirProtocol, for $400 million and rebranding it to #PolygonZero.

23/ Polygon claims Mir Protocol contains the “fastest” ZK-proof technology, called plonky2, “a recursive SNARK that is 100x faster than existing alternatives and natively compatible with Ethereum.”

I'll stop here due to Twitter thread limits. Hopefully, this is a nice precursor to my previous threads and highlights the diff between sidechains and rollups.

As always, you can find this info and more about ORs, #ETH scaling, #TheMerge, etc. here

mirror.xyz/0x3D5FE39342e6…

And, as always, I have to thank @chriscantino @spencernoon @finematics @joincoinsider @epolynya @NewsAsset @Delphi_Digital @TheBlock__ @DuneAnalytics @RyanBerckmans @_jdkanani @_anuragarjun @SquishChaos @howtousecrypto @kermankohli @cryptotesters