Smart contracts are immutable pieces of code and their outcomes are irreversible. Hence, formal verification of their code is very important before deploying them. It’s very hard to verify smart contracts in the Ethereum Virtual Machine (EVM). A business can’t afford to deploy faulty but immutable smart contracts and suffer the consequences of their irreversible outcome. This article details the challanges: “Fundamental challenges with public blockchains”.

My take is that the Bitcoin architecture is a solution to the problem of how to maintain consensus about a ledger when the participants are unknown and many of them are adversarial (I know this is loose language… computer scientists working in the consensus space are more precise but I think this captures the essence…. i.e. we’re explicitly in a world where there is no “leader” and no identities for those providing the consensus services).
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“The consortium or company running a private blockchain can easily, if desired, change the rules of a blockchain, revert transactions, modify balances, etc. In some cases, e.g. national land registries, this functionality is necessary; there is no way a system would be allowed to exist where Dread Pirate Roberts can have legal ownership rights over a plainly visible piece of land, and so an attempt to create a government-uncontrollable land registry would in practice quickly devolve into one that is not recognized by the government itself….
A side-chain is a separate block-chain that runs parallel to the main chain, for example the Bitcoin network, and is attached to the main chain through a simple two-way peg, or special 'address'. A user sends coins to this special address and this amount is effectively 'locked' out from use on the main chain and available on the side chain. This currency is released back to the main chain once its been proven that the side chain is no longer using it.

Nikolai Hampton pointed out in Computerworld that "There is also no need for a '51 percent' attack on a private blockchain, as the private blockchain (most likely) already controls 100 percent of all block creation resources. If you could attack or damage the blockchain creation tools on a private corporate server, you could effectively control 100 percent of their network and alter transactions however you wished."[9] This has a set of particularly profound adverse implications during a financial crisis or debt crisis like the financial crisis of 2007–08, where politically powerful actors may make decisions that favor some groups at the expense of others,[51][52] and "the bitcoin blockchain is protected by the massive group mining effort. It's unlikely that any private blockchain will try to protect records using gigawatts of computing power—it's time consuming and expensive."[9] He also said, "Within a private blockchain there is also no 'race'; there's no incentive to use more power or discover blocks faster than competitors. This means that many in-house blockchain solutions will be nothing more than cumbersome databases."[9]
Now, making experimental or rapid changes to Bitcoin is very risky and so change happens slowly. So if the one-size-fits-all architecture of Bitcoin doesn’t suit a particular use-case, you have a problem. You either have to use an entirely different cryptocurrency (or build one!). Or you have to use (or build) a centralized service, which brings new risks.

Terasol's mission is to create apps that would help people learn and grow with tech. Every member of Terasol shares the same dream of working towards building apps that would not only create history but also give people the opportunity of experiencing tech they did not know could become essential part of their lives. A lot has changed since we developed our first app; we have grown with each project and refined our skills to serve nothin ... Read more
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“The only reason the banks have gotten to the point of thinking about permissioned ledger is because they finally reached the stage of bargaining, third stage in five stages of grief, for industry they’re about to lose. They start with denial, and the basis of denial is, well, this thing isn’t gonna work, it’s gonna die any day soon, and it doesn’t. And then they say, it’s just silly money and it doesn’t have any value, until it does; and no one else is gonna play with it, except they are; serious investors won’t put money into this, except they did; and it still refuses to die. We go from denial to bargaining. Somewhere in between might be anger, some depression, and eventually they’re going to reach acceptance, but it’s gonna take a long time. 

Forbes reports that blockchain and biometric eyeball scanning technologies underpin the systems that support food distribution in the Syrian refugee crisis. While there are many further uses of blockchain, at the core of its business functionality is the creation of transparent, stacking “ledgers” of information. This is where private blockchain can prove extremely useful.
Function Transactions executed between the locks and unlocks of the main chain tokens don't bloat the main chain. As the technology of a side chain is connected to its main chain, it can be used to build on the developments of the main chain and introduce new features to the market. Child chains serve as the transactional chains of the parent-child architecture, as the parent chain retains minimal features.

Private blockchains are valuable for solving efficiency, security and fraud problems within traditional financial institutions, but only incrementally. It’s not very likely that private blockchains will revolutionize the financial system. Public blockchains, however, hold the potential to replace most functions of traditional financial institutions with software, fundamentally reshaping the way the financial system works.
In order to trade assets from the mainchain for assets from the sidechain, one would first need to send their assets on the mainchain to a certain address, effectively locking the assets up. After the transaction has been completed, a confirmation will be communicated to the sidechain. The sidechain will then release a certain amount of the assets on the sidechain to the user, equivalent to the amount of assets ‘locked up’ on the mainchain times the exchange rate. To trade the assets from the sidechain for assets of the mainchain, one would need to do the same, just the other way around.
Frankly, secure implementation of Bitcoin is already a pain in the ass .. adding more complexity just seems like the wrong move at this point. It’s already trying to be a currency, a networking protocol and a client in the same codebase. Adding turing complete (or not) scripts with arbitrary outcomes, multiple versions of the official client cooperating, multiple clients, and now multiple blockchains is basically the nail in the coffin in terms of widespread implementation.

Side-chain is another blockchain for one blockchain. To use side-chain of Bitcoin, for instance, you need to move BTC from the original chain to the side-chain. Then, BTC on the original chain is locked and the same amount of BTC on the side-chain appears. This is how BTC can be used/tested on another chain where we use some features different from the original ones.
Our Proof of Work tutorial talks about it in depth, but the best explanation might come from Satoshi Nakamoto himself. If the camps above start receiving messages that don’t agree, they rely on executing a Proof of Work. The Proof of Work is sufficiently complicated and requires significant computing power. Once one camp solves the Proof of Work, it broadcasts the results to the other camps. This message is now accepted in a chain of messages and the competing messages are dropped by the other camps.
Because decentralization has been viewed by many as intrinsic to the revolutionary potential of blockchain, the point of private blockchains might be called into question. However, blockchains offer much more than a structure that accommodates decentralization. Among other features, their strong cryptography and auditability offers them more security than traditional protocols (although not bulletproof, as noted), and they allow for the development of new cryptocurrencies. Furthermore, voting platforms, accounting systems, and any type of data archive can arguably be optimized with blockchain technology. We are still in the early days of blockchain technology, and the power it has to reshape older systems has yet to be seen.
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This list is not exhaustive. There are plenty of public blockchains, and they are actively adopted by such industries as FinTech, gaming, logistics, and beyond. However, it not always makes sense to move certain processes and businesses to the public network as the latter are characterized by comparatively low speed of transactions execution and high costs. Indeed, every transaction requires a consensus of the entire network. Unfortunately, it takes time and resources.
Counterfeiting items is a $1.2 trillion global problem, according to Research and Markets 2018 Global Brand Counterfeiting Report. The rise of online commerce and third-party marketplace sellers have made the crime more prevalent in recent years. Blockchain technology can help consumers verify what they ordered online and what they receive in the mail is what they intended to purchase.
Side chains have two main advantages. Their first advantage they have is that they are permanent. You do not have to create a new sidechain every time you need to use one. Once a side chain is built, it is maintained and can be used by anyone doing a specified task off the main chain. The other advantage of sidechains is that they allow interaction between different cryptocurrencies. Developers get the opportunity to test software upgrades as well as beta coin releases before they are released on the main chain.
Looking for a top private blockchain open source? Here is a list of private blockchain development companies with client reviews and ratings. Private blockchain network on contrary to public and permission blockchain can be run and utilized by one organization only. Additionally, private blockchain platform organizes distinctive components of the technology in order to serve different applications. By prioritizing productivity over the secrecy, permanence, and transparency, private blockchain open source adheres to the qualities normally connected with the technology. The scope of uses for private blockchain might be narrow yet its power to enhance processes are no less important. GoodFirms has thus created a list of top private blockchain companies below:
Sidechain is a chain of blocks based on the main parental blockchain. Sidechains realize the new financial ecosystems via integration into Bitcoin. Relatively new to Bitcoin, the sidechain is an extension that enables the ability both to build a link between BTC and an altcoin and to create new independent services that work via the main Bitcoin blockchain. Using sidechains allows for the creation of various types of smart contracts, stocks, derivatives, etc. It is possible to develop a limitless number of Bitcoin or Ethereum-based sidechains with different tasks and features, assets of which will depend on the main blockchain’s volatility. It allows traditional blockchains to support several kinds of assets, payments, smart contracts and also to increase the level of security and anonymity of transactions.

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.

Cabe destacar el papel de la gente de Blockstream, una de las compañías centradas en la búsqueda de este objetivo (con un extremeño en sus filas, Jorge Timón). Blockstream está trabajando actualmente en el desarrollo de un protocolo que permita crear sidechains. Son los responsables de uno de los papers más conocidos sobre el tema, publicado en Octubre del 2014:

At Iryo, we consider databases and blockchains that are not opened to the public to be insecure they, can easily be altered by the business running it, at their discretion and it goes against the ethos of the open and transparent cryptocurrency space. Designed to keep public out and introducing “trusted” middlemen, private chains forget that trusted third parties are security holes.

What if we could run heavy computations in a more centralized fashion, say on a single server, and then periodically integrate the results onto the main blockchain for posterity. We temporarily expose some vulnerability while the parallel server runs the heavy computation, but we get a massive benefit in that we don’t have to run the computation on chain, and simply need to store the results for future verification. This is the general premise behind Truebit. We won’t get into all the details of Truebit but there is a concept of challengers, who check to see the computations that were made have high fidelity.
2) Yea, blockchain could be a suboptimal MQ Series, a slower append only persistent wire that has a lot of ready-made tools for audit and security analysis (ecosystem argument). As blockchain ecosystem grows all kinds of data transformation tools will appear (e.g. we are working on such). Inside blockchain could be tuned to be less PoW intensive and to cut blocks faster. Besides, the variations of PoS or a hybrid PoW + PoS scheme are emerging which could use the fact that inside, as you say, all network participants can have clear identities, unlike on the public bitcoin’s blockchain.
Sidechain is a blockchain that runs parallel to the main blockchain. It extends the functionality of interplorable blockchain networks. Interpolable blockchain networks signifies the ability to share data between different computer systems on different machines. It means that data can be sent and received between interconnected networks eliminating the possibility of negative impact to the networks. Sidechain enables this to be done in a decentralised manner to transfer and synchronise tokens between two chains.
The idea emerged that the Bitcoin blockchain could be in fact used for any kind of value transaction or any kind of agreement such as P2P insurance, P2P energy trading, P2P ride sharing, etc. Colored Coins and Mastercoin tried to solve that problem based on the Bitcoin Blockchain Protocol. The Ethereum project decided to create their own blockchain, with very different properties than Bitcoin, decoupling the smart contract layer from the core blockchain protocol, offering a radical new way to create online markets and programmable transactions known as Smart Contracts.
Ethereum, a provider of decentralized platform and programming language that helps running smart contracts and allows developers to publish distributed applications. Factom, a provider of records management, record business process for business and governments. Blockstream, a provider of sidechain technology, focused on extending capabilities of Bitcoin. The company has started experimenting on providing accounting (considered a function to be done on private blockchain) with the use of public blockchain technology.
2. I have not had a chance to read the original article on side chains, but I am sure they deal with my next problem quite adequately. However it is not addressed in the above article. The primary problem that must be addressed with the notion of side chains, as I see it, would be the issue of the mining required to authenticate transactions and enter them into the block chain. The article mentions that side chain system more or less leaves the issue of verification within the side chain transactions as something of a black box, somewhat implying that they don’t have to be considered. But for any user, they would need to be both considered and understood. Such a process would presumably require mining verification of some kind, (our mental model must include consideration of the somewhat unusual verification method for bitcoin transactions themselves, – as everyone would agree, the verification process is not just a “checklist” of valid transaction strings. The validation process requires mining in much the same sense as mining new coin. None of this is mentioned or discussed in the article. ) As a result, the verification of side chain transactions outside the block chain introduces whole new layers of risk into the Bitcoin model, and new layers of unknowns.

SoluLab Inc is leading Blockchain, Mobile and Web development company, started by ex vice president of Goldman Sachs and ex principal software architect of Citrix. SoluLab Inc provides full spectrum, 360 degree services to enterprises, startups and entrepreneurs helping turn their dreams into awesome software products. We help enterprises to dominate the decentralized world with our top-notch blockchain development sol ... Read more

These in-channel payments would be instant, unlike current Bitcoin payments, which require an hour to be fully verified on the blockchain. What’s more, payments would be routable across multi-hop paths, like packets across the Internet — so instead of having to create a channel to every new counterparty, you could maintain a few channels to a small number of well-connected secure intermediaries and send/receive money through them.

Blockchain, trust, decentralization, Bitcoin, transparency, anonymity, blockchain, blockchain, blockchain. These words seem to appear randomly on the Web regardless the theme of an article you read. Don’t you know how to implement blockchain in art? There’s definitely someone who can tell you. Do you wonder how banking can benefit from blockchain? No worries, some projects already do it – just search for the use cases.
Ardor is a blockchain platform predicated on childchains (sidechains) that use proof of stake (PoS) consensus. It uses the primary chain as a security chain and the childchains for processing transactions to increase scalability. Their design is specifically focused on speed and efficiency through PoS consensus and removing blockchain bloat through pruning.
Peer-to-peer blockchain networks lack centralized points of vulnerability that computer crackers can exploit; likewise, it has no central point of failure. Blockchain security methods include the use of public-key cryptography.[4]:5 A public key (a long, random-looking string of numbers) is an address on the blockchain. Value tokens sent across the network are recorded as belonging to that address. A private key is like a password that gives its owner access to their digital assets or the means to otherwise interact with the various capabilities that blockchains now support. Data stored on the blockchain is generally considered incorruptible.[1]
Bitcoin blockchain design has been done for a specific purpose, and this is a money (crypto currency) transfer. But what will we do, if we want to change or add some functions of the bitcoin blockchain? What if we want to transfer other assets rather than money, what if we want to do transactions automatically when pre-determined events occurred. Or what if we don't want other people see our transactions, or track our transactions' history. You can ask countless of what if questions and every answer to these questions drive you to a different blockchain or configurations
Bitcoin’s block interval is ten minutes so it takes about five ten minutes on average for a new transaction to find its way into a block, even if it pays a high fee. This is too slow for some people so they have experimented with alternative cryptocurrencies, based on the Bitcoin code-base, which employ quicker block intervals   [UPDATED 2014-10-27 to correct my embarrassing misunderstanding of mathematics…]
A company called Blockstream has been focusing on these developments and has announced the release of Sidechain Elements, which is an open-sourced framework for sidechain development. It includes a functioning code and a testing environment for working with sidechains with several components: the core network software to build an initial testing sidechain, eight new features not currently supported by bitcoin, a basic wallet and the code for moving coins between blockchains.

The consensus mechanism involves ascertaining transaction validity and uniqueness. Smart contracts address the validity portion. To ensure uniqueness, the protocol program in Corda checks whether any other transaction has used any of the input states of this transaction. If no other transaction has used any of the input states, that this transaction is unique.
Fully private blockchains: a fully private blockchain is a blockchain where write permissions are kept centralized to one organization. Read permissions may be public or restricted to an arbitrary extent. Likely applications include database management, auditing, etc internal to a single company, and so public readability may not be necessary in many cases at all, though in other cases public auditability is desired.
“The only reason the banks have gotten to the point of thinking about permissioned ledger is because they finally reached the stage of bargaining, third stage in five stages of grief, for industry they’re about to lose. They start with denial, and the basis of denial is, well, this thing isn’t gonna work, it’s gonna die any day soon, and it doesn’t. And then they say, it’s just silly money and it doesn’t have any value, until it does; and no one else is gonna play with it, except they are; serious investors won’t put money into this, except they did; and it still refuses to die. We go from denial to bargaining. Somewhere in between might be anger, some depression, and eventually they’re going to reach acceptance, but it’s gonna take a long time.