Blockchain 101: Private vs Public Blockchains

Let’s discuss how public and private are different. 

– Access and Authority 

Public blockchain is a decentralised network, it is open for anyone to read and write. So the ledger is fully transparent to the public. Participants have full autonomy to read and write. But for private blockchains, it is partially decentralised as only authorized users can access the data but may not be able to access everything. Regulations and rules, like compliance requirements, can enable the organisation seamlessly. 

– Consensus 

In a public blockchain, anyone can participate in the verification process and add data to the blockchain. In private blockchain, only authorised users can take part and control. 

– Immutability 

To understand why public blockchain is immutable, we will need to understand about cryptographic hashes. Each block on public blockchain has a unique identity called Hash which correlates and seals in the next block. No one can alter or delete the data of the block after publishing in the blockchain. In addition, if anyone attempts to change anything, the following block will reject the alteration. Besides, any modification will need the consensus of over 51% of anonymous participants in the network. This will also immensely minimizes the chance of having ‘bad actors’ to invade the system and take over the consensus process. 

Contrarily, records on private blockchain have a higher chance of change happening, as the entity is able to reach out to all their users to make the consensus over 51% for alteration. However, private blockchain has lesser participation become more susceptible to a hack and manipulation as only certain approved participants can access. 

– Transaction Speed/ Efficiency 

Private blockchains undoubtedly will be faster than public one, as the more users the network involves the more congested it is. It can digest hundreds or even thousands of transactions per second.