Specifications of Public, Private and Consortium Blockchains
Which cryptocurrency to invest in 2021? Do not know? Well, this happens to most of the crypto enthusiasts. You need to seek correct information about the different types of blockchains available in the domain of decentralized finance.
Seeking correct information in this regard should be the highest priority of every crypto enthusiast. Correct information in this regard could help them learn about the best types of blockchain technologies available in the cryptocurrency market.
Different Types of Blockchains:
Which cryptocurrency to invest in 2021? Let’s get to know about Blockchain first.
What is Blockchain?
It is the hottest 21st-century financial trend. This distributed ledger technology is changing the way people transact in all walks of life worldwide.
The potential of this technological innovation in the domain of decentralized finance can be utilized for recording financial transactions and tracking assets. This is mainly why businesses in all parts of the world are embracing this financial revolution.
This distributed ledger is shared by multiple entities. However, no entity controls it.
Coming back to the point, there are three different types of blockchains.
- Public Blockchain
- Private Blockchain
- Consortium Blockchain
Public Blockchain: Public blockchains are open source and allow participants to anyone as the following:
- Community members.
Some Specifications of Public Blockchains:
- Transactions happening through public transactions are completely transparent.
- A public blockchain is fully decentralized.
- No individual controls this type of blockchain.
- No individual or entity controls transaction records.
- No individual or entity controls the order in which transactions are processed.
- Public blockchains are censorship-resistant. Therefore, it becomes hard for authorities to shut them down.
- Tokens designed to incentivize/reward users for their financial behavior within the network are associated with the public blockchain.
Private Blockchains are also known as permission blockchain. This type of blockchain is considerably different in comparison to the public blockchain.
- Nobody can join the network without seeking consent.
- Transactions carried out on private blockchains remain private.
- Transactions remain available only to the participants who have been consented to join the network.
- The level of centralization in the private blockchain is high as compared to the level of centralization in the public blockchain.
Enterprises willing to collaborate and share data prefer private blockchains. But these enterprises do not prefer their data to be available on public blockchains. The governance structure of these blockchains is significantly controlled by individuals or entities.
Consortium blockchains could be called the sub-category of public blockchains. Therefore, this blockchain can offer the benefits of public blockchain also. More importantly, consortium blockchain is usually governed by a group of individuals instead of a single entity.
- It is a collaborative model of blockchains that offers numerous benefits.
- This blockchain type brings business competitors on the same page.
- Businesses leveraging the potential of consortium blockchain be more efficient through collaboration on some aspects from the business point-of-view.
- Participants of consortium blockchain could be anyone. For example, central banks, governments, and even supply chains, etc.
This distributed ledger technology had been invented for application in the domain of the decentralized financial world only. However, the world quickly realized the potential of blockchain technology in other walks of life also.
As a result, various industries and governments in the world have now started exploring the potential of this distributed ledger technology in all walks of life.
Which cryptocurrency to invest in 2021? Now is the time to know about it. This is something that you will come to know about in our next blog post.
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