Peer-to-Peer Bitcoin Sidechains

Drivechain allows BTC to travel back-and-forth to other software applications (called “sidechains”). Thus, BTC-owners can opt-in to new features or tradeoffs. Those who don’t opt-in, never need to care what any sidechain is doing.

As with the Lightning Network, DC-users move their coins into a “layer-2” – a zone where BTC can change hands an unlimited number of times. Eventually, just the net effect of these transfers is recorded back on layer-1.

Bitcoin Core can’t observe any layer-2 (by design), so we need a way to discourage fraudulent “netting”. LN counters theft via “justice transactions”; DC via forsaken mining revenues. LN-netting is private and instant; DC-netting is public and VERY slow (once per ~3 months).

Key benefits – only obtainable via Drivechain:


Drivechain is made of two BIPs, 300 and 301:

  1. Hashrate Escrows – “Container UTXOs” that compress 3-6 months of transaction data into a fixed 32-bytes.
  2. Blind Merged Mining – A technique to replace the act of running a sidechain node with the act of including a single high-fee transaction.

Explainer Memes

Selected Recent Interviews

  1. 51 Minutes (0:26:00 to 1:17:40) during an Oct 14 Whalepool Talk on Bitcoin, Drivechain, and Hivemind
  2. Let’s Talk Bitcoin – Episode #377

Per learning theory, here is an explainer written by someone who just learned Drivechain.

Critiques and Controversy

View the main critiques of Drivechain.

Please read the FAQ!

Getting Started

Go here for a guide on downloading and using this software. It has screenshots to help walk you through the process.

Hang out with us by joining the Drivechain Telegram Group.

Check out this this blockexplorer, and this SideShift (Instant Sidechain Withdrawal Service) project, by @abrkn.

Even More Info

Problems With Today’s Mono-Chain Setup

  • Blockchain technology has economic tradeoffs, and users disagree over the optimal tradeoff. But only one group can have their way at a time. Instead we need multiple heterogenous layers (Satoshi, Finney).
  • Bitcoin investors must worry about competition from other projects (Ethereum, Z-Cash, Ripple).
  • Satoshi, creator of Bitcoin, wanted to support many transaction types, but knew that his design was prohibitively inflexible.
  • Bitcoin is supposed to be used as money, but if it cannot be used on some networks, it is constrained as a medium of exchange – and therefore at a competitive disadvantage.

Instead, sidechains are alt-chains that all use the same Bitcoin token. They start with zero coins; they accept Bitcoin deposits, conduct Bitcoin transfers, and finally dispense Bitcoin withdrawals.

Main Benefits

  1. Permissionless Innovation: Anyone can create a new blockchain project, without facing the (near-impossible) task of also bootstrapping a new unit of money.
  2. Eliminates Competition: Bitcoin will always have the best code, because it can copy any code that exists.
  3. Freedom to Choose: Satoshi’s consensus protocol requires everyone to agree on everything, down to the very last byte. Sidechains allow users to choose which benefits they would like to pay for.

Other Benefits

  1. Anti-Scam: SCs filter out get-rich-quick schemes (the ‘get rich’ part is now impossible). Therefore, good projects can stand out and receive our attention.
  2. Faster Progress: SCs let us test new features. The tests are safe – if these features fail, they won’t take down the main network. However, the tests are also informative – real BTC is on the line.


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