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How Different Is Permissioned Blockchain From Permissionless Blockchain?

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Introduction

Blockchain has created ripples throughout many industries. Its security futures are ever essential now with increasing data due to IoT. Artificial Intelligence and Machine learning are used to analyze the data generated to find different patterns as per the requirement. Blockchain is essential to secure the data or transfer the data securely.

Different industries are trying to implement the blockchain technology to improve their business. Hence, it is essential to design the platform in terms of their requirement. To facilitate the same, we have different types of blockchain platforms available. They are as follows:

  1. Permissioned blockchain or Private blockchain
  2. Permissionless blockchain or Public blockchain.
  3. Hybrid blockchain.

Permissionless Blockchain

Cryptocurrency platforms are classic examples of permissionless blockchain platforms. As the name suggests, it is a public blockchain. Anyone can join the network to perform different activities in the network, like users, miners, developers, or community members. Since the network is transparent, anyone can have a look at the transactions getting confirmed in the network.

πŸ”“ Permissionless blockchain networks follow all the underlying principles of a real blockchain network. These networks are genuinely decentralized.

πŸ”“ Authorities cannot shut down the network as no single entity controls the network. People, regardless of nation, location can join the network from anywhere.

πŸ”“ Mostly all public blockchains are linked to a token with some intrinsic value. Based on the network-specific number of coins are mined at the beginning itself, or new coins are mined after every block is confirmed.

πŸ”“ Miners are rewarded with these tokens to keep running the network smoothly.

πŸ”“ Bitcoin is an example of a permissionless blockchain network.

Permissioned Blockchain

Enterprise blockchains are an excellent example of permissioned or private blockchains. Permissions should be given for different entities to join the network.

πŸ” Everyone should have valid credentials to join the network.

πŸ” These networks are not genuinely decentralized as these networks are created for the purposes of enterprises.

πŸ” Not all the members of the network can see the transactions unless they have appropriate permissions.

πŸ” Different Hyperledger platforms developed for different enterprise use cases are good examples of permissioned blockchain networks.

πŸ” These blockchains are often not associated with tokens as enterprises run these.

Consortium Blockchains

Consortium blockchains are nothing but private blockchains but run by different entities together. Blockchain, being niche technology, different companies, even rivals, are coming together as a consortium to develop the technology.

R3 Corda is one such example in the financial place formed to create the technology for Fintech purposes.

Hybrid Blockchain

Hybrid blockchains offer the functionalities of private and public blockchains together at the same time. The entities involved can choose which data should be open or closed, depending on their functionality. The users need not forgo one feature completely to utilize the other functionality.

πŸ”πŸ”“ Interoperability is very much possible, enabling to form multichain because of the hybrid nature of the platform.

πŸ”πŸ”“ Dragonchain is an excellent example of Hybrid blockchains.

These are different types of blockchains available as of now, enabling the adoption of various industries as per their requirement.

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