RSK is the first open-source smart contract platform with a 2-way peg to Bitcoin that also rewards the Bitcoin miners via merge-mining, allowing them to actively participate in the Smart Contract revolution. RSK goal is to add value and functionality to the Bitcoin ecosystem by enabling smart-contracts, near instant payments and higher-scalability.
This construction is achieved by composing smart contracts on the main blockchain using fraud proofs whereby state transitions can be enforced on a parent blockchain. We compose blockchains into a tree hierarchy, and treat each as an individual branch blockchain with enforced blockchain history and MapReducable computation committed into merkle proofs. By framing one’s ledger entry into a child blockchain which is enforced by the parent chain, one can enable incredible scale with minimized trust (presuming root blockchain availability and correctness).
“Blockchain could significantly reduce time delays and human mistakes, and monitor cost, labor, waste and emissions at every point in the supply chain. In the food sector, a manufacturer could automatically identify contaminated products in a matter of seconds and wouldn’t need to pull an entire product line from store shelves in the case of contamination.”
Plasma, a project by Ethereum, uses this side chain concept. It encourages transactions to happen on side chains (or child chains). An authority governs each of the child chains. If the authority starts acting maliciously, anyone on the child chain can quit the child chain and take back their pegged assets on the main chain. It’s in its early stages of development but shows a lot of promise in handling some of Ethereum’s scalability issues.
The Loom Network recently released their SDK which supports what they call “Dappchains,” an Ethereum layer-2 sidechain solution with each sidechain comprised of their own DPoS consensus mechanism. This enables highly scalable dapps, specifically games built using their tools. Loom emphasizes the earlier comment about sidechains enabling innovation in scalability, rather than providing it directly. Loom’s sidechains have their own set of rules and are used to offload computation from the primary Ethereum chain. Their sidechains are application-specific, meaning that they enable highly scalable dapps through an efficient consensus mechanism and can periodically be settled on the main Ethereum chain depending on their security needs. You can find more information on their model here.
A user on the parent chain first has to send their coins to an output address, where the coins become locked so the user is unable to spend them elsewhere. Once the transaction has been completed, a confirmation is communicated across the chains followed by a waiting period for extra security. After the waiting period, the equivalent number of coins is released on the sidechain, allowing the user to access and spend them there. The reverse happens when moving back from a sidechain to the main chain.
Instead, what if the game was played in its own “channel”? Each time a player made a move, the state of the game is signed by each player. After an epic battle where the Protoss player takes out the remaining Zerg forces and forces a gg, the final state of the game (Protoss wins) is sent to a smart contract on the main chain. This neutral smart contract, known as a Judge, waits a while to see if the Zerg player disputes the outcome. If the Zerg player doesn’t, the Protoss player is paid the 1 ETH. </injects>