Blockchain is a peer-to-peer
(P2P), decentralized, distributed ledger technology that stores digital asset
ownership records. Blockchain technology is a legitimate disruptor for markets
like healthcare, cybersecurity, and payments because any data stored there cannot
be modified.
Types Of Blockchain
Blockchain is the most discussed technology at present because
it offers immutability, transparency, and security. This technology has the
potential to revolutionize the way businesses and industries work. This is the
reason why it is attracting blockchain experts and blockchain developers.
Blockchains have been
categorized into three types depending on the requirements and use. The three
types are private, public, and consortium blockchains. Each of these blockchain
networks solves particular problems and serves a specific purpose as well. Each
also has unique features and advantages over the other.
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Private
Blockchain
A private blockchain operates
in a closed network. It is a restrictive and permission blockchain. This type of
blockchain is typically used inside of a company where only specific members
can participate in the blockchain network. It works best for businesses and enterprises
that want to use blockchain solely internally.
Furthermore, a private
blockchain is not highly accessible. It is limited to a particular group of
people. A single authority maintains the private blockchain network, making it
more centralized. Some examples of the private blockchain are Corda,
Hyperledger Sawtooth, Hyperledger Fabric, Multichain, and Ripple (XRP).
Pros
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Highly
scalable
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Higher
transaction per second
Cons
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Achieving
trust is difficult
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Less
decentralized
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Less
secure when compared to public blockchains
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Public
Blockchain
A public blockchain is a
distributed ledger, non-restrictive, permissionless system. This means that
anyone with an internet connection can join and become a part of the blockchain
network. This type of blockchain is used for mining and exchanging
cryptocurrencies.
Additionally, it upholds
confidence across the entire user base since everyone feels motivated to
contribute to the development of the network. Bitcoin is the first example of
such a blockchain. Other examples of public blockchains that followed are
Ethereum, Litecoin, IOTA, Monero, and Bitcoin Cash.
Pros
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Secured
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No
intermediaries
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Transparent
and trustable
Cons
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Consumes
a lot of energy
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Lack
of transaction speed
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Scalability
issues
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Consortium
Blockchain
The consortium blockchain is
also called federated blockchains. This type of blockchain works best for
organizations with the need for both private and public blockchains. More than
one organization is involved in this type. The organization grants pre-selected
nodes access to read, write, and audit the blockchain.
Furthermore, consortium blockchains
continue to be decentralized because no single entity is in charge of control.
Examples of consortium blockchains are Quorum and Corda.
Pros
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Better
control and customizability over resources
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Secured
and offers scalability
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Most
effective for organizational collaboration
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More
efficient than public blockchains
Cons
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Less anonymous than other
blockchains
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Less
transparent
All three types of blockchains
have unique feature requirements, usage, and advantages. You should have
in-depth knowledge of each one of them if you are a part of it already.
Conclusion
A private blockchain is a
one-stop solution if you want to develop and execute your enterprise blockchain,
and anyone can join a public blockchain. Whereas, the consortium blockchain is
best suited for organizations and enterprises who want efficient, streamlined
communication among one another. Ensure that you consider your business
features and requirements before choosing a blockchain.
Blockchain is a peer-to-peer (P2P), decentralized, distributed ledger technology that stores digital asset ownership records. Blockchain technology is a legitimate disruptor for markets like healthcare, cybersecurity, and payments because any data stored there cannot be modified.
Written by Sam