The fulcrum of the "new internet" is blockchain technology. At the most basic level, each 'block' is a database component that stores data. There are two sorts of blockchain: public and private. While public blockchains are decentralized peer-to-peer networks, the ledger in private blockchains is governed by a centralized authority: The major distinction is the level of access provided to users.
Public blockchain network
Public blockchains, also known as permissionless blockchains, are entirely open and adhere to the concept of decentralization to the letter. That is, anyone can join the network and read, write, or participate within the blockchain. A public blockchain is also decentralized. Both Bitcoin and Ethereum are public blockchains. Those are the two most successful, best examples of public blockchain networks to date. Anyone in the network has access to the chain and can add blocks to it. Public blockchains are also essentially anonymous, in contrast to private blockchains, which do not conceal the identities of anyone participating in the transaction.
The following characteristics of public blockchain:
- High Security — It is safe because of mining (51 percent rule).
- Open Environment — The public blockchain is accessible to everybody.
- Anonymous Nature — Everyone in the public blockchain is anonymous. There is no need to use your real name or identity, so everything remains concealed, and no one can trace you down based on that.
- No Regulations — There are no rules that nodes must obey on the public blockchain. As a result, there is no limit to how this platform may be used to improve one's life.
- Full Transparency — A public blockchain allows you to view the ledger at any moment. There is no room for corruption or inconsistencies, and everyone is required to keep the ledger and participate in consensus.
- True Decentralization — There is no centralized entity in this form of blockchain. As a result, the burden for network maintenance falls entirely on the nodes. They are updating the ledger, which promotes justice with the use of a consensus method.
- Full User Empowerment — In most networks, users are required to obey a slew of rules and regulations. In many circumstances, the regulations may not even be just. However, this is not the case with public blockchain networks.
- Immutable — Once something is recorded on the blockchain, it cannot be altered.
- Distributed — Unlike a client-server method, the database is not centralized, and all nodes in the blockchain participate in transaction validation.
Private blockchain network
A private blockchain is administered by a network administrator, and members must get permission to join the network, making it a permissioned blockchain. The network is controlled by one or many companies, necessitating reliance on third-party transactions. Only the entity participating in the transaction has knowledge of the transaction completed in this sort of blockchain, and others will not be able to access it, i.e., transactions are private.
Some of the benefits of private blockchain include:
- Complete Privacy - It focuses on privacy issues.
- Private Blockchains have a higher degree of centralized control.
- High Efficiency and Faster Transactions — When nodes are distributed locally, yet fewer nodes are participating in the ledger, performance improves.
- Better Scalability - The flexibility to add nodes and services on demand may greatly benefit the organization.
The similarity between a private blockchain and public blockchain
The similarities between public and private blockchains are that they both act as append-only ledgers where data may be added but not changed or removed. As a result, these are known as immutable records. Because both of these blockchains are decentralized and dispersed throughout a peer-to-peer network of computers, each network node possesses a complete duplicate of the ledger.
Both verify the authenticity of a record, offering a significant amount of immutability until the majority of participants agree that it is a legitimate record and establish an agreement. This reduces the possibility of tampering with the records.
Both blockchains rely on a large number of users from any third party to authenticate updates to the distributed ledger, resulting in the construction of a new master copy that can be viewed by everyone at all times.
Difference between public blockchain and private blockchain
The biggest difference between public and private blockchain networks is that private blockchain networks have to spend investment costs to design, create and manage. On the other hand, a public blockchain network won't have to spend any additional initialization and design fees.
Finally, keep in mind that as public blockchain security measures improve, their value will rise, making the usage of private blockchain less necessary. Private blockchains, on the other hand, can't be beaten when it comes to having more control and the capacity to restrict access to certain persons. Each type of blockchain has its own strengths. Depending on the business requirements, you need to choose the best one for you.
Difference between Public and Private blockchain, geeksforgeeks.org, accessed 12th March 2022.
Difference between private and public blockchain, blog.ipleaders.in, accessed 12th March 2022.