Cardano's IOG launches EVM-compatible sidechain toolkit

Input Output Global (IOG), the research and engineering firm helping build Cardano, has announced a public proof-of-concept testnet for its new toolkit for developing custom sidechains is now live.

IOG consists of a team of specialist engineers building on the Cardano blockchain. The toolkit will enable developers to build custom sidechains for Cardano. Moreover, these sidechains will be EVM-compatible, meaning they will extend the functionality and scalability of Cardano.

According to CoinMarketCap, sidechains, which have their own consensus algorithm and features, increase a blockchain’s decentralization and interoperability. Thanks to the IOG-developed toolkit, the sidechain will be connected to the mainchain via a bridge, which allows asset transfers. Block finality is ensured through the sidechain’s consensus mechanism and relies on Cardano’s security. Cardano itself is secured by the Ouroboros consensus protocol.

IOG has been working on the creation of a toolkit for sidechains in order to allow developers to leverage Cardano’s infrastructure. In late November 2022, it demonstrated the first stage of its EVM application development at IO ScotFest in Edinburgh.

How the toolkit works

The Cardano toolkit consists of three main components:

• Mainchain Plutus scripts: they enable secure cross-chain transactions and token movement.
• A chain follower: it tracks the mainchain data and events that govern the sidechain
• A sidechain module: it interprets mainchain data and implements the necessary ledger adaptations.

Source: IOG

Furthermore, the toolkit contains a technical specification document with an introduction and a guide to Cardano sidechains. It will allow developers to do the following:

• Move data and assets between the main chain and the custom sidechain
• Support various consensus protocols, ledger rules, and languages
• Secure sidechain launches
• Secure small chains
• Allow experiments, incubation, and research.

The EVM sidechain application is now live on testnet.

Benefits of the Toolkit

The toolkit will benefit blockchain developers, DApp developers, stake pool operators, and DApp users alike. Its benefits are:

• Extensibility: It allows developers to create their own sidechains on Cardano, making the blockchain more extensible and growing and sustaining its ecosystem.
• Interoperability: The Cardano sidechain toolkit makes it easy to create sidechains that are interoperable with the mainchain while retaining their own consensus protocols and block formats.
• Scalability: Sidechains can help improve scalability, as they allow for transactions to be processed off the main chain. This can reduce the load on the main chain, enabling it to process more transactions and increase overall throughput.
• Security: It ensures the security of the mainchain, even when new sidechains are added.
• Flexibility: It allows developers to experiment and research with sidechains without having to worry about the security and infrastructure concerns that come with building an entirely new blockchain.

Cardano plans to continue building as part of its roadmap, which is currently in the “Basho” phase. The blockchain remains committed to an interoperable future and contributes to this with the rollout of the new sidechain toolkit. Cardano will be working with its community and the IOG team to ensure a smooth rollout and further development to foster the growth of the Cardano ecosystem.

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