Ethereum scalability layer2 plasma sidechain

Ethereum scalability layer2 plasma sidechain

Aug 26, 2022


Hammad Ali

Since 2009 the blockchain has a huge impact on the market and make the people to realize the power of blockchainits potential. At that time the real-life scenarios of the blockchain were limited to payments but after releasing of Ethereum there was huge bull run in the blockchain market.    

Ethereum helps in establishment of blockchain in real life such as games, web apps and many more. With the evolution of blockchain era, many new issues are arising and one of the top’s issues is Scalability issue.

  • One of the limitations we faced from the blockchain is its scalability issue. Sidechain is one of the solutions for improving the scalability of the blockchain. Increasing in scalability of blockchain will help in regularizing the blockchain technology in our real-world application.

  • High-cost transaction also discouraging the people. In the case of Ethereum based decentralized application, the user cannot afford such transaction fee. Scalable solutions are providing low-cost fee even some solutions provide zero fee transactions.

  • Today, roughly Ethereum can process 13 transactions per second which is small number. For competing with the currently available solutions, the scalability is very necessary for the network.

Scalability Solutions: –

Scaling of the Ethereum network off the main net is also known as Layer 2. There are many different types of Layer 2 Solution.

  1. Rollups

  2. ZK rollups

  3. Optimistic rollups

  4. State channels

  5. Plasma

  6. Validium

  7. Sidechains

  8. Hybrid solutions

Matter Labs helps in distinguishing the available different scalability solutions. Here is the comparison of these solutions on the basis of following categories.  

  • Security

  • Performance

  • Usability

  • Other Aspects

Plasma & Sidechains: –    

Our article is mainly focused on the Plasma and Sidechain as well as their applications use case. Moreover, the differentiation of solutions based on the plasma and sidechain is also an important aspect of this article. Here is the pictorial representation of the Plasma, Sidechains, Plasma Chain connectivity with the main net as well as their important properties.


Matic network’s research helps in comparing some of these chains.


What is sidechain?

=> Sidechain is basically a separate chain in parallel with the main chain. The sidechain provides facility of transferring digital assets or token between these two chains.

Ethereum based Sidechains: –

           Ethereum based sidechains are similarly those chains which are running parallel to the Ethereum network with their own consensus algorithm and token as well. There are many Ethereum based sidechains and continue to grow with the time. Some of the Ethereum based sidechains are listed below:

  • xDai

  • Incognito

  • Skale

  • PoA


        xDai is a sidechain of Ethereum aims to provide high scalable and less costly network. xDai provides stable price cryptocurrency and It has two tokens:

  • DAI

  • Stable token used for transactions, payments and fees

  • Pegged to US Dollar

  • xDai Stake

  • Governance token used for supporting the underlying Proof-of-Stake Consensus.

The stable coin nature of the xDai increase its usage in real world applications. It helps in moving assets between main net using Dai-xDai bridge. The xDai Bridge converts Dai to xDai and vice versa.

Use Case:

        xDai ecosystem has a huge potential in the project & Dapps sections. Development based on xDai ecosystem is fast adaptive. There are already many sections which have been targeted.

  • Peer-to-Peer Payments.

  • DeFi

  • Community Currencies

  • Prediction Markets

  • Blockchain Games

  • NFT

  • B2B & Enterprise Applications.


        PoA  core cover a blockchain and as well as provide the facility of product development for the Ethereum ecosystem.


  • As a sidechain to Ethereum, PoA is using the Proof of Authority for its consensus.

  • 5 second block time

  • A full block on POA costs less than .01 cent.

         Use Cases: –

  • Games

  • Local Currency

  • Subsidized Transaction

  • Defi

         Some of the POA based Dapps are:

  • Geon App

  • POA Bridge

  • Dope Raider and many more.

Incognito: –

          Privacy aimed Ethereum side chain and provides less costly and fast transaction on the chain with the usage of Proof of stake consensus algorithm.


  • Can be attached to any blockchain to conduct confidential transfer of assets.

  • Using this bridge, anyone can turn on privacy for their tokens and shield their balances and activity.

  • 40 second block time


       N.O.D.E foundation built a sidechain as a solution to the scalability of Ethereum. This project was named SKALE Network.


  • Gives developers the ability to easily provision highly configurable fully decentralized chains that are instantly compatible with Ethereum.

  • Proof of stake is used as a consensus algorithm in SKALE.

  • Employing multiple sidechains.

  • Deploy scale sidechains quickly

  • Smart contract processing.


Plasma is one of the important layer2 solutions. It’s basically a framework that helps in increasing transaction throughput. It provides the functionality of building smart contract on top of it. There are many providers which have make it easy to develop plasma-based chains. The chains which are built on the plasma are called plasma chains.

  • Loom

  • Polygon (previously known as Matic Network)

  • Gluon

  • Gazelle

  • LeapDAO


  • OMG Network

Loom: –

Loom network is one of the scaling solutions of Ethereum which provides faster transactions and empower the decentralized applications by using plasma at its core.


  • Cross Chain integration.

  • LOOM token is used for securing the Loom Network’s main net

  • Developer use Loom token for hosting Dapp.

  • Loom Network runs on Delegated Proof of stake

  • Ready-made Solution for developers.

Matic: –

Layer 2 solution for the scalability of the Ethereum with the adoption of Plasma and using Proof of Stake based side chains.

Features: –

  • Provide APIs and SDKs for fast and easy development. Few steps are for integration of Matic on the Dapps.

  • Highly Scalable

  • High Throughput (65K transactions/second)

Use Cases:

  • Decentralized Exchanges

  • Gaming

Wrapping it up:

         Scalability of the Ethereum network can be ensured by any of the above mechanism but it depends upon the use case. In some use case the no of transaction per second could be the first priority. But overall Matic is the efficient solution for solving the scalability of the blockchain. These solutions could result in growing of the blockchain in the real-life application.

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Copyright © 2024 Alphabase. All rights reserved.

Copyright © 2024 Alphabase. All rights reserved.

Copyright © 2024 Alphabase. All rights reserved.