An Insightful Guide on Types of Blockchain and its Significance

 

1. Blockchain is a chain of timestamp records stored in a decentralized database that a group of participants manages the network. 
2. In simple terms, blockchain is a decentralized ledger where each peer can access the data stored in the network The encryption of data records in the blockchain is done using cryptographic techniques. This ensures the security of the data and makes it immutable.
3. The prime concept behind blockchain technology is to have a network of users called 'nodes' which can have a secure and legitimate transaction directly without the involvement of third-party intervention.
4. In a blockchain network, an authorized node can access a set of records and add as a legitimate block in the blockchain. This makes the blockchain system an immutable and distributed virtual public ledger that can record all types of transactions.
5.  Now, let us learn more in detail about the different types of blockchain and their significance.
6. There are primarily two types of blockchain private and public blockchain. However, there are several variations, too, like consortium and hybrid blockchains.

Types of Blockchain

Public Blockchain:

• A public blockchain is open-source. They allow anyone to join as a user, miner, developer, or community member. All transactions on a public blockchain are transparent, meaning that anyone can review the transaction details.
• Public blockchains are completely decentralized, without any individual or entity controlling which transactions are recorded in the blockchain.
• Public blockchains are highly censorship-resistant. Since anyone in the open network can join, regardless of the location and nationality, it is hard for authorities to lock them down.

Private blockchain:

• The other type of blockchain is the private blockchain, also known as the permission blockchain. It possesses a number of notable differences from the public blockchain. 
• In the private blockchain, the participant needs the approval to join the network. The transactions are private and are only available to the network participants that have been permitted to join the network. The private blockchain is more centralized than the public blockchain.
• Private blockchains are more beneficial and valuable for businesses who want to collaborate and share data but don't want their sensitive business information visible on a public blockchain.

Consortium blockchain:

• A consortium blockchain is considered as a separate designation from private blockchains. The main difference between them is that the consortium blockchain is governed by a group rather than a single entity. This has almost the same benefits as a private blockchain.
• Consortium blockchains are more efficient both independently and collectively by collaborating on some aspects of their businesses.
• The network participants in consortium blockchains can include anyone from the governments to central banks to supply chains.

Hybrid blockchains:

• Hybrid blockchain occupies a unique place within the blockchain ecosystem. This means it has both private and public blockchains benefits. 
• This blockchain provides businesses with the flexibility to choose between what data they want to make public and what they want to make private. 
• The hybrid blockchain platform allows users to connect with other blockchain protocols easily. Simply put, it allows users to connect a multi-chain network of blockchains.

Conclusion:

It is up to the business to decide which blockchain will serve your purpose better. If you choose any blockchain out of these, all you need to do is have a thorough knowledge of how a blockchain works and make smart moves in the future.
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