Blockchain Glossary

State Channels

Published on August 28th, 2021

State channels refer to the process in which users transact with one another directly outside of the blockchain, or ‘off-chain,’ and greatly minimize their use of ‘on-chain’ operations. It’s one of the most exciting Ethereum scaling solutions in development and the closest advancement to being production ready.

State channels are very similar to the concept of payment channels in Bitcoin’s Lightning Network, but instead of only supporting payments, they also support general ‘state updates.