Types of Blockchain

The critical characteristics of blockchain have enabled its usage in different application services and sectors, such as smart contracts, cryptocurrency, banking, insurance, etc. Multiple types of blockchain have been developed for implementation in various types of entities. Briefly, these are [16]:

Public Blockchain

In this type of blockchain. any user can participate in a transaction; that is, it is open source. No particular organization controls it. As this is open for participation and contribution, user identity is well hidden, which provides one of the best anonymities over the network. This type of blockchain also uses an incentive mechanism. That is, for mining purposes, incentives are presented to the miners. Some examples of public blockchain that are widely used and accepted are Bitcoin and Ethereum. This type of blockchain is also called permissionless blockchain. In terms of performance, public blockchain works a little bit more slowly than private blockchain does, because it has a lot of participating members. The consensus protocols used here also have some impact.

Private Blockchain

This is also known as permissioned blockchain. The nodes participating in the mining and verification process are fixed earlier by the authority, meaning private block- chain imposes specific rules and restrictions in operation. A group of individuals or entities participates in the controlling of the blockchain. The consensus is also based on the particular objectives of the entities or organizations. Private blockchain sometimes poses a centralized architectural model, as it is controlled and restricted to a certain number of individuals or organizations. Various consensus algorithms are used here. Depending on the consensus algorithm and the types of organization the blockchain belongs to, the authority selects the participants for transaction and verification. The usage benefits of private blockchain are organizational policy restrictions, data confidentiality, the protection of organizations, the need for less scalability, and other particular features that limit any corporate or individual organizations from taking part in a public blockchain network. Moreover, as only the selected participants can access the network, potential security breaches can be detected. Hyperledger, Hash graph, Corda, etc. are examples of popular and widely adopted private blockchain platforms.

Consortium Blockchain

Consortium blockchain comprises functional attributes of both public and private blockchain. However, public blockchain allows anyone to participate in the transaction and mining process. This property is absent in consortium blockchain. Consortium blockchain allows specific entities to participate in network activities. For this reason, this type of blockchain resembles more a private blockchain than a public blockchain, revealing a partially decentralized architecture. A consortium blockchain is also known as a federated blockchain. In this type of blockchain network, a permission access attribute is used, so that there is a controlled flow of participants, and organizational policies, rules, regulations can easily be incorporated.

Hybrid Blockchain

A hybrid blockchain comprises both public and private blockchain. It incorporates the characteristics and benefits of both types. The benefits of hybrid blockchain can range from permissioned access, modification according to the implementing organization, the use of flexible consensus protocols, etc. These benefits and features are adopted according to the requirements of the users. A hybrid blockchain is not fully permissionless; instead, it imposes specific rules while participating in the blockchain network. Ensuring the immutability and consensus procedure through particular nodes by assigned authorities, this type of blockchain increases the flexible use of the blockchain platform. It facilitates more room for verification and the detection of confidentiality breaches, and provides more control over the network. Hybrid blockchain platforms include Dragonchain. The aforementioned types of blockchains are summarized in Table 8.1 [17-20]:

Consensus Algorithms

This is an algorithmic process for validating blockchain transactions. It is a combined decision-making process, w'here the nodes or involved parties have to reach a consensus for a confident decision [21]. Blockchain is a distributed network, providing


Summary of Attributes of Public, Private, and Consortium Blockchain





Network type


Partially decentralized

Partially decentralized


No specific entity holds control of the network, anyone can enter

A specific organization holds control of the network, where access is limited

A group of predefined known entities control access of the network



All miners

Miners within one organization

Selected miners within an organization








Proof of Work (PoW), Proof of Stake (PoS), Proof of Elapsed Time (PoET). Delegated Proof of Stake (DPoS)

Practical Byzantine Fault Tolerance (PBFT). RAFT

Practical Byzantine Fault Tolerance (PBFT), Proof of Authority (PoA). Delegated Proof of Stake (DPoS)







Efficiency (in terms of resources)

Less efficient, as the entire network verifies the transactions

Highly efficient, as a single organization verifies the transactions

Highly efficient, as fewer nodes are involved in the verification process







Costly, due to an increased number of nodes

Less costly, due to a fewer number of nodes

Less costly, due to a fewer number of nodes









Restricted to only a single entity or organization

Restricted to authorized group






Completely transparent

Transparent only to granted users

Transparent based on predefined protocols


Impossible to tamper

Possible to tamper

Possible to tamper



Needs incentives to grow the network for better security

Does not need incentives, due to a single trusted node

Does not need incentives, due to selected trusted nodes


Bitcoin. Ethereum. Litecoin, etc.

Hyperledger, Corda. Hashgraph. etc.

Ripple. R3. etc.

anonymity for the users. Anonymity is vulnerable in any system and can pose threats, such as trust issues and malicious intruders. Consensus algorithms are used to address these issues and achieve reliability, by establishing a trustworthy interaction among the participants in the network. The purpose of using these algorithms is to resolve several computational complexities. There are various types of consensus algorithms, some of which are briefly discussed as follows.

< Prev   CONTENTS   Source   Next >