Blockstream’s First Bitcoin Sidechain Goes Live
On Wednesday, Blockstream, a leading provider of blockchain technologies, announced the official launch of its sidechain for Bitcoin blockchain. According to the statement released, this is the first sidechain of bitcoin that will allow developers and institutional investors to safely create new crypto tokens without restrictions.
The Liquid blockchain was launched on September 27, 2018, according to the statement. Companies such as Bitfinex, BitMEX, Bitso, Xapo, XBTO, and Zaif participated in this launch. The group, which is made up of more than 20 companies, makes up the Liquid Network. The network ensures that the assets of network users are protected through a geographically diverse federation, without a single point of failure.
Liquid Bitcoin (L-Bitcoin)
Liquid is a sidechain that allows network users to create their tokens, which can represent existing financial instruments such as cryptocurrencies, tokenized fiat money, gold-backed cryptocurrency or any other digital asset. The sidechain has its own asset, Liquid Bitcoin (L-Bitcoin) – backed by a two-way peg to (BTC) – and can be redeemed at any time. The two-way peg enables assets to be interchanged between the sidechain and the main blockchain.
This allows institutions and end users to exchange bitcoins safely and quickly – in a matter of minutes. In addition, Liquid will allow confidential and private transactions within the network using Confidential Transactions (CT), a tool developed by the company to increase the privacy of transactions. CT keeps the amount transferred visible only to participants in the transaction.
Liquid will also allow the realization of Atomic Swaps so that users can exchange assets for other assets without the need for a trusted third party. A bitcoin/asset swap can be done in a single transaction since bitcoin and Issued Assets can each be inputs and outputs of a Liquid transaction.
The Liquid sidechain is built as a protocol that interacts with Bitcoin in a transparent manner. The sidechain is expected to bring major improvements in the capabilities of existing bitcoin blockchain.
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