The Difference Between Public, Private, and Permissioned Blockchain
Blockchain technology promises a world in which data is embedded in a digital code, stored in transparent, and decentralized databases protected from deletion, editing, and tampering.

The Difference Between Public, Private, and Permissioned Blockchain

You have presumably been there: a job interview, with a panel of interviews sitting opposite to you thoroughly scrutinizing your resume. What’s more, you can’t help the feeling that they don’t believe you.

As a matter of fact, you can’t blame the interviewers for being skeptical. According to research that was currently conducted by Statistic Brain, it turns out that most of the information contained in job applications and resumes are falsified and misleading. How can we ensure that there is transparency in our credentials?

Blockchain technology promises a world in which data is embedded in a digital code, stored in transparent, and decentralized databases protected from deletion, editing, and tampering. This system is designed to forestall fraud, by offering access to third-parties for purposes such as assessment and job interviews. Additionally, Blockchain was designed in a way that it securely does away with the middleman in any given transaction. It is achieved through setting up a peer-to-peer transaction. In this case, each transaction is verified and synched with every node related to the blockchain before it is recorded to the system. For a better understanding, let me explain how a blockchain works on your computer. Imagine that three company accountants have the same file on their computers. When you make a transaction, an email is automatically sent to the three accountants informing them of the transaction. One of the accountants then reacts to this notification by checking whether you can afford the transaction. Once the validation is done, the accountant who took care of the transaction replies to the other two with their reasoning, and if they all agree, then everyone updates their file.

Now that we know how a blockchain explained, the question that could be lingering is what a blockchain is. A blockchain is simply a ledger of records organized data batches known as blocks that make use of cryptographic validation to link themselves together. The most interesting bit about this ledger is that it exists in multiple locations at the same time such that anyone interested can keep a copy of it. As a user, to be able to monitor the transactions, addresses, and blocks on a Bitcoin blockchain, you need to use a Bitcoin Block Explorer. With the blockchain explained, let’s jump to the differences that exist between Public Blockchains and Permissioned Blockchains .

Public Blockchain Vs. Permissioned Blockchain

With a Public Blockchain , as a user, you have the privilege to not only read but also write the data stored on the Blockchain. This is because of the open access. Public Blockchain makes it possible for one to store, send and receive data provided to you as a member of the network. Better still, due to the complete decentralization of the Public Blockchain, consent to write and read data within the Blockchain is shared equally among the participants, who have to agreed before any data is stored on the blockchain.

Public Blockchain does not offer special privileges, therefore, users from all walks of life can transact directly using Bitcoins without the interference of mediators. Bitcoin, a digital form of currency, makes it possible for clients to manage the transactions with the issuance of bitcoins conducted by the blockchain network. One thing to note is that bitcoins are stored in blockchain wallet, also known as Blockchain.info, which serves the same purpose as a bank account only that in a blockchain wallet, instead of storing currency, you store bitcoins.

The decentralization of the blockchain makes it hard to hack given that all the nodes within the system are synched with the entire blockchain database making it too costly to hack. What’s more, the system is configured in a way that the value of the hacked coins diminish once a hack is detected. With Public Blockchain, all the transactions need to be verified by several participants, and this can be time-consuming. As Public Blockchain user, you end up paying more regarding transaction fee as compared to the Permissioned Blockchain user. Furthermore, the devices in this blockchain are properly connected and any hitches that may arise can be fixed by human intervention, which can be easily approved by the users since the users trust the single organization in control of the Blockchain.

Public Blockchain does not offer special privileges, therefore, users from all walks of life can transact directly using Bitcoins without the interference of mediators.

Permissioned Blockchain, on the other hand, serves as a bridge between Public Blockchain and Private Blockchain , thus the name Consortium Blockchain. In a Permissioned Blockchain, not every user is granted the privilege to take part in the transaction verification process. This means that just a single company have the total control over the data within the blockchain, contrary to Public Blockchain where all the users have full control. Here is an example to illustrate further – if we have a chain of say eight companies each operating a device that is linked to the blockchain network. If one company only trades and shares its invoices with two or three companies, then there is no need for the other companies in the consortium to get the permissions to read the shared data. However, some level of decentralization is maintained in their structure, the users can read or write consents to the other users, prompting a Permissioned Blockchain design known as ‘Partially Decentralized’ design. Generally, with Permissioned Blockchain, there is quick verification of transactions given that there are several verifiers. Unlike Public Blockchains, the Permissioned Blockchains maintain a high level of privacy of a participant’s data.

Conclusion

As we all know, there is no innovation that is perfect, and just like any other technological innovation, both the discussed blockchains have their pros and cons. With that in mind, the decision on which blockchain to employ in your firm-Public or Permissioned Blockchain- depends on the type of data stored, who will be granted the access to read and write data on the blockchain, and finally, whether all the users will have the same or different privileges while using the blockchain.