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As for tokens, one potential implementation would be that they would be issued for Bitcoin pegs and redeemed in the same way. The system would prove the circulation. The sidechain back-end would serve mainly as an 'assay' agent which would make sure that the token was not bogus. Probably transactions would normally involve having the tokens re-issued as a way to extinguish any previous claim after a transaction (which would probably involve a layered system of digital signatures.) A nicety would be that they could probably be used 'off-line' in situations where one could at least temporarily trust the seller to be somewhat honest for a time and not be creating and issuing bogus tokens. In the real world many transactions are done between parties who know one another and/or have reputations to promote, so for small sum transactions this would actually work quite well.
As I understand things, NXT is (in addition to probably being a scam) a token based system that (in theory) relies on 'proof of stake'. A Bitcoin-backed token-flavored sidechain would not need 'POS' since it's backing is native Bitcoin.
Since you are so amazingly thick, let me again stress that this is but one in an infinite set of potential implementations for sidechains. Most or all sidechains would need an interface layer where they interact with Bitcoin, and usually (if not always) support Bitcoin through the same old POW sha256 hash mining mechanism which, as I've also previously outlined, is conceptually economically broken as an enduring method of system support in a stand-alone ecosystem.
I still do not see the point of "token" side chains.
The main point is that there are a lot of different and often enough conflicting goals that one might wish in a currency solution. I've taken a few moments and invented one basically on-the-fly just as an example. Such an idea might be applicable for some problem sets.
Another point is that it creates demand for and use of Bitcoin in exactly the same way as 'traditional' use of native Bitcoin does, but the natural advantages for targeted use cases expand the demand.
Your explanation (sales-pitch) of "token" side chains and supposed implementations are not selling me on the idea.
I'm not trying to sell anything. I've got nothing to sell and no reason to (other than to try to protect my holding in Bitcoin from being destroyed by trying to shoe-horn it into roles where it doesn't fit I suppose.) Again, it's just a few things I thought of off the top of my head, though a couple of the ideas have struck me before.
What's the point if the infrastructure is not as sound as the master chain? There are no guarantees that the infrastructure of a SC would be equivalent in security if not better. If it was better why would the market not just use the more secure blockchain?
Actually the goal of this particular idea is, very deliberately, to be LESS 'sound' than Bitcoin. It's actually a very specialized and quite inefficient and expensive system which transfers every transaction around the world immediately and retains them indefinitely on all manners of autonomous systems. That level of specialization is simply overkill for most exchange transactions, and most people who think it makes sense think that every transaction looks like a nail because all they know is a hammer. An idea like the one I cooked up considers this (and has the latency and off-line capabilities which go along with a more relaxed system design.)
One time I was taking a 300 or 400 level class in structural engineering at some shitty state university. Some PE came from California and gave a really good lecture on his real-world experience with the '89 earthquake. About 3 of the (few) follow-up questions for the guy was 'did you re-design the building to be more strong when you fixed the damage.' To him, and anyone with a brain and a basic understanding of engineering, the obvious answer was 'no'. I could tell he was amazed to even be asked the question, much less asked three times. I felt bad for the guy that he wasted his time, and embarrassed to be in a group with such nitwits. Deja-vu here.
BTW you use the word "probably" a lot in your implementation/explanation.
So? It's a tag for an idea which is so basic that it would be the likely course, though other better ideas might come up, or there might be subtleties which argue against it if/when one gets down to implementation.
A less secure chain (network) only means MORE able to be MANIPULATED by a malicious party.
That's simply not true. If I have a ton of gold in a vault and a few nickles in my pocket, the ton of gold is probably at greater risk because the reward for obtaining it is much greater.
Besides, the more native Bitcoin grows the more it is open to various kinds of attack, collapse, or de-evolution into something other than what it started out as (and loses it's appeal for this reason.) This is in fact one of the biggest reasons that sidechains appeal to me. This growth and the associated risks need not be inevitable.