Charles Hoskinson, the founder and CEO of IOHK Foundation, recently appeared on an interview to speak about the presence of sidechains on the Bitcoin [BTC] blockchain. This has recently become a talking point among the cryptocurrency community with the launch of Liquid, a Bitcoin sidechain launched by Blockstream.
Liquid aims to be a way for users to utilize the Bitcoin blockchain with instant and private transactions, with an asset pegged 1:1 to BTC known as Liquid BTC. On the issuance of L-BTC, Hoskinson stated in an interview with Crypto Insider:
“They’re doing sidechains with a federated peg because they can’t fork Bitcoin to get their stuff out…I’m glad to see interoperability, I’m glad to see somebody’s trying to innovate with Bitcoin, that’s the hardest job of all.”
He explained why it was difficult to innovate on the Bitcoin blockchain, mostly due to its position as the “king of the hill”. Owing to this, it moves “incredibly slow” stated Hoskinson. According to Hoskinson:
“The only way you’re going to innovate is by building federated services on top of it and those services rely on a hack to connect to Bitcoin. [Then] you have a collection of federated systems that does everything whether you’re okay with that or not, that’s a philosophical things. That’s really your innovation space with Bitcoin.”
He also recounted his experience with sidechains in the early days of the cryptocurrency space, where he was with the former CEO of Blockstream. Reportedly, he was asked by the press:
“The media asked me, aren’t you worried that when Bitcoin gets sidechains everything you’re trying to do with Ethereum is going to be unnecessary and irrelevant because they can just connect Ethereum via a sidechain. I said when are sidechains coming out. They said oh the latest will be 2015. And I said okay good luck with that.”