What is State Channel?

Question

Accepted Answer

A State Channel is a foundational Layer 2 scaling solution that enables two or more participants to conduct a high volume of transactions and state updates off-chain, securing the final outcome by only submitting the initial funding and the final, agreed-upon state back to the main blockchain.

State Channel

What is State Channel?

How does a State Channel work to achieve off-chain scalability while maintaining the security guarantees of the main blockchain?

What are the key performance metrics and efficiency gains offered by State Channels compared to direct on-chain transactions?

What are the primary use cases for State Channels, and which major projects have successfully implemented this scaling technology?

What are the main limitations and trade-offs associated with State Channels, and how do they compare to other Layer 2 solutions like Rollups?

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