Cardano’s New Toolkit Lets Devs Build Custom Sidechains

IOG, the firm behind Cardano, has released an open-source toolkit enabling everyone to build custom sidechains.

A tiny man in the sky stuck between two Cardano ADA coins.
  • IOG, the company behind Cardano, released tools for building custom sidechains.
  • Cardano could become more scalable as sidechains take on specific roles.
  • New sidechains could attract more users and developers in Cardano’s ecosystem. 

Cardano, the decentralized blockchain platform, launched a new developer toolkit for building custom sidechains. 

Input Output Global (IOG), the company behind Cardano, announced the launch on Thursday. The toolkit would allow developers to more simply build their custom sidechains on Cardano. 


The toolkit would allow developers to “leverage Cardano’s security and infrastructure” to create custom, specialized sidechains. They will also allow developers to test dApps on dedicated testnet sidechains. Moreover, IOG made these tools fully open-source. 

“Decentralization and interoperability are key to the future of blockchain. These features ensure that no person or entity is able to control a blockchain or be restricted to just one ecosystem,” IOG’s technical writer Neil Burgess wrote. 

"To grow, from both engineering and social perspectives, most applications and communities need to be empowered with their own sovereignty and design choices," he added.

IOG developers have already built one such sidechain as a proof of concept; the Ethereum Virtual Machine (EVM) sidechain. According to IOG, the EVM sidechain will be available to the public later in January 2023.

Sidechains – New Tools for Scaling

Sidechains are separate blockchains that connect to the main blockchain through a bridge or a two-way peg. This allows users to securely transfer assets between the main blockchain and the sidechains. 


"The toolkit allows the sidechain to have its own consensus algorithm and features. A sidechain connects to the main chain through a bridge that allows asset transfer between the chains," Burgess wrote. 

One of the advantages of sidechains is that developers can customize them for specific purposes. For instance, a specific sidechain could handle high-volume transactions or enable private transfers. 

Moreover, the main blockchain can provide security and decentralization for all the sidechains. 

“The finality of blocks is determined through a consensus mechanism that relies on the security of the main chain,” Burgess added. 

These sidechains take the strain off the main blockchain, making it more scalable. 

IOG and Cardano

Cardano founders Charles Hoskinson and Jeremy Wood cofounded IOG in 2015, after breaking from the Ethereum project.

The company, formerly Input Output Hong Kong (IOHK), is responsible for developing the Cardano blockchain. This includes research, development, and implementation.

On the Flipside

  • The success of Cardano’s custom sidechains will depend on adoption developers and the community. While the new toolkit may provide the necessary tools and resources, it will ultimately be up to individuals to use them. 

Why You Should Care

The development is potentially big for Cardano as it could improve its scalability and provide additional use cases for the network.

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

David Marsanic

David Marsanic is a journalist for DailyCoin who covers the intersection of crypto, traditional finance, and government. He focuses on institutionalized crypto entities like major cryptocurrency exchanges and Solana, breaking down complex topics into easy-to-understand writing. David's prior experience as a business journalist at various crypto and traditional news sites has enabled him to maintain a critical approach to news while adhering to high journalistic integrity standards.