The Difference Between Public, Private, and Permissioned Blockchain

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?

Our top trading bots

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.

Essential 2021 Crypto Trading Bots For You To Operate With
Automated Bitcoin trading is getting consciously popular among crypto investors and independent traders. Although, are there any criteria to identify a...
The In-Depth Explanation Of Crypto Wallet Keys And Their Multiple Details
Before an individual can commence any type of crypto trading or transactions, such as transferring Bitcoin to purchase items, the buyer can send money through...
Why to Buy Bitcoin Instead of Cash?
As this popular digital currency is taking more and more space in the financial world, everybody is interested in getting more information about the reasons...
7 Things You Can Do with Blockchain
According to Gartner’s Hype Cycle 2017, blockchain technology is among those that promises us a bright future. By this stage, everyone has heard about...
What is Blockchain Technology and How Does it Work?
That’s why imagine blockchain as a technology that keeps track of every digital transaction that happens online, whether it is an exchange of goods and...
How Legal is Bitcoin and Other Cryptocurrency?
Bitcoin as the main asset of the independent, decentralized system of trade was always under the eye of the institution's such tax authorities, law enforcement...
Bitcoin Mining Pools – the Way of Earning Money in the 21 Century
The twenty-first century dictates the new lifestyle rules for people all around the world. Nobody wants to leave the house and work for getting money....
Can Blockchain Technology Change the Finance World?
As the most innovative technology of modern days is carving its path into the world of business, finances, and various types of industries, many pose the...
How Exactly Do Bitcoin Transactions Work?
Bitcoin transactions are digitally signed for security and are sent to bitcoin wallets. For this to happen, your bitcoin wallet and a bitcoin network should...
Ethereum Proof of Work vs. Proof of Stake
All the miners, BTC holders, and cryptocurrency traders have to encounter the terms " proof of work " and " proof of stake " at some point. These two...
TOP 25 Cryptocurrency Terms
Actively developing in recent years, cryptocurrencies spawned some new terms and concepts. Here is a brief glossary: 1. Address – a set of letters...
Difference Between Bitcoin and Litecoin
The story about the difference between Bitcoin and Litecoin started when they were created and launched. Bitcoin was created in 2009 as the first-ever...
Creating a Bitcoin Paper Wallet
Cryptocurrency wallets usually consist of two keys. A public key represents user's wallet address on which other users send Bitcoins. A private key is...
Satoshi Nakamoto, the Founder of Bitcoin
Satoshi Nakamoto is the name that stands behind the unknown person or group of people who created Bitcoin and its original implementation. As the part...
How Can I Sell Bitcoin?
As Bitcoin is volatile, and its value changes all the time, once you hit the right price and sell it, your Bitcoin wallet may contain less funds than before,...