Types of Blockchain
Blockchain is divided into the following types:
• Public Blockchain
• Private Blockchain
• Consortium Blockchain
• Hybrid Blockchain
It goes without saying that blockchain networks are not completely and 100% impenetrable. These networks are actually a distributed ledger that determines its level of security through programming and written codes. If any of these codes are compromised, they can be hacked.
What is a Public Blockchain?
The first example of this technology is the public blockchain. This type of blockchain is the origin of Bitcoin and has greatly contributed to the popularity of distributed ledger technology. Public blockchain has solved the problems associated with centralized organizations, such as lack of security and transparency, and this distributed ledger does not store information in just one place but publishes it in a peer-to-peer network.
Due to its decentralized nature, blockchains require a way to validate data. Therefore, the blockchain network uses a consensus algorithm through which network members (nodes) agree on the current state of the ledger. Proof of work and proof of stake are two of the most common examples of these methods.
A public blockchain is permissionless and anyone with an internet connection can log in to the blockchain and act as a node on the network. Such a user has access to past and current information and can also perform mining operations. No data or transactions in the blockchain can be changed, and anyone can verify, troubleshoot, or change the purpose of its processes; because the source code of that blockchain is generally open source.
One of the advantages of public blockchains is their independence from organizations. That is, if the organization that created it is dissolved, the public blockchain will continue to operate as long as the nodes are connected to its network. Another positive aspect of public blockchains is the transparency of the network. As long as users adhere to a framework of security protocols, public blockchains remain completely safe and secure.
On the other hand, the network may not be fast enough, and companies are unable to restrict access or use. If hackers can secure 51% of the computing power of a public blockchain, they can make changes to the network. Public blockchains do not have a high level of scalability (processing speed); as the number of nodes in the network increases, the speed of the network decreases.
The most common areas of use for public blockchains are mining and trading cryptocurrencies such as Bitcoin. They can also be used to create a document, such as notarized and official electronic certificates for certificates or property deeds, without an expiration date and with an auditable source.
This type of blockchain is ideal for organizations that are based on transparency and trust, such as social advocacy groups or non-governmental organizations, as private companies may be reluctant to participate due to the public nature of the network.
Advantages of public blockchains
1. Open read and write
Anyone can contribute to the blockchain by submitting transactions. Examples include Ethereum and Bitcoin. In these cases, transactions can be viewed on the blockchain explorer.
2. Distributed ledger
The database is not centralized like in a client-server approach, and all nodes in the blockchain participate in validating transactions.
3. Immutability
Once something is written to the blockchain, it cannot be changed.
4. Secure due to mining (51% rule)
For example, in the case of Bitcoin, gaining a majority of the network power has the potential to provide massive re-spending and, if a majority of the network power is gained, the possibility of preventing transactions from being confirmed. But in practice, gaining this power is almost impossible.
