We’ve witnessed what Blockchain is and what it’s capable of. As a testament to the claims, Blockchain technology has infiltrated and disrupted industries far beyond projections. As like any entity, the technology is growing, evolving, and emerging as the next go to technology for businesses to adapt.
That being said, it’s prone to some trait flaws that have taunted the optimal and potential application of Blockchain. There are some variations in the technology that look to overcome these traits and broadly bucket the innovations under Public Blockchain and private or permissioned Blockchain.
Taking a look at Public Blockchain
Usually public Blockchain protocols are Proof of Work (PoW) consensus algorithms. The main attribute is they are open source and not permissioned. Anyone can participate in them without any access restrictions.
Public chain offers anyone access to download codes and run a public node onto their device, validate transaction in the networks, by means participating in the consensus process. Consensus process determines which blocks should get added to the chain.
This would make way for any user in the world to transact via the network and would hope to see them included in the Blockchain if in case of validity. They would also be able read transactions on the public block explorer. However there would be no reason to worry as the transactions are transparent, but at the same time anonymous.
This holds a great potential to disrupt existing business models by bringing in disintermediation into the picture. Businesses don’t need to spend on infrastructure or maintain any server or systems admin, which in-turn is seen as the cost of the Decentralized application is considerably reduced.
Some of the success stories in public Blockchain would be Bitcoin, Ethereum, Dash, Litecoin and many more.
Here’s what private Blockchain has to offer
High profile and private institutions such as banks and financial centers had their eye on using the core idea of Blockchain. With the evolution of Distributed Ledger Technology (DLT), they aimed to create a permissioned Blockchain, which in other terms would mean a private Blockchain framework, where the validators would be a member of a consortium or independent legal entity belonging to the same organization. Many experts believe the idea of private or permissible Blockchain in a contradiction to the very purpose and intent of core Blockchain.
That being said private Blockchain does have some pros to it. For instance a private chain is highly efficient, more secure and creates a controlled environment. It’s a long way to go when financial institutions would embrace Blockchain completely. This is where Public chain takes a leap over private chain, as it holds the potential to replace the way traditional financial institutions work with technology implementation.
Both the Blockchain aren’t that different
- Public and private chains hold the core concept of decentralized peer-to-peer networks.
- In both Blockchain networks all participants maintain replica of the shared ledgers.
- They also provide guarantees on the immutability of the ledger.
- Consensus process is imminent in both the Blockchain.
With the recent events that shed a positive light such as the governments and major corporate player investing a fortune into the R&D of this major technology; there are instances which would make a layperson lose confidence in the technology, incident like the lack of regulation leading to cryptocurrency and ICO frauds and more. For financial services to go all out public chain protocol seems to be a big leap for FinTech sectors, however the future seems promising.
Amalgamation of the good aspects of both public and private chain protocols to create a Consortium Blockchain which again gleams with potential across various industries reiterating the lost trust in the technology. Experts believe this could be the next step in the evolution of Blockchain.