Public blockchains were designed and developed with a focus on ensuring that any number of interested parties can execute the business logic and access transactional information. Similarly, any interested party can also verify and validate the transactions incoming to the network, as well as be rewarded for the process.
Private blockchains are implemented to ensure that access to business information is limited and only accessible to a limited set of participating stakeholders.
Permissioned blockchains are a hybrid implementation of what both public and private blockchains have to offer. Permissioned blockchains are implemented if data is to be accessed by a specific stakeholder. This is achieved by leveraging private networking, as well as the encryption of transactional user data, which is also stored in blocks that may consist of transactions relating to other stakeholders in the consortium.
Comparing usage scenarios
The following table shows how the three types of blockchain can be used in various scenarios. They are:
|
Attribute versus variant |
Public blockchains |
Private blockchains |
Permissioned blockchains |
|
Network barrier |
Access to the network is not restricted. The details inside public blockchains are widely accessible to all users. |
Access to the network is limited by an IP or a DNS. Only a few people with suitable credentials can join the network. |
Access to the network is limited to verified participants. Only selected people can join the network with limited permissions to read, write, or both. |
|
Restrictions |
There are many different actions that the user can perform, such as develop a smart contract and use it, host a node as a validator, and so on. |
Virtually, there are only two common roles for members in a private blockchain—facilitated nodes as validators and DApps users. |
Based on the role of the members, the users may be able to deploy DApps, use DApps, validate transactions, or all three. |
|
Encryption |
Almost all of the user data in blocks is not encrypted as the general goal is to serve the information to a public audience. |
Encryption may not be used if there is a trust quotient between the participating stakeholders. |
Encryption is widely used as it involves various stakeholders in the networks with potential conflicts of interest. |
In the next section, we will further understand the privacy options in blockchains.