What are the Different Types of Blockchain Network?

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BLOCK6

4 min readJun 21, 2022

There is no doubt that blockchain technology has advanced significantly over the last decade. It all started with Bitcoin, which provided the first type of blockchain: public blockchain. Bitcoin’s blockchain is also known as the first generation of blockchain technology.

Currently, there are various types of blockchain technology, each of which serves a specific purpose and solves a specific or set of problems. More importantly, many businesses are implementing them in order to maximize the benefits.

When blockchain technology was first introduced to the world, it was in the form of a public blockchain with a cryptocurrency use-case. It is difficult to understand its creator’s intent, but in general, it provided the concept of decentralized ledger technology (DLT).

The DLT concept altered how we solved problems in our environment. It enabled organizations to operate independently of a centralized entity.

When it comes to applying blockchain technology to various scenarios, distributed technology solves the drawbacks of centralization, but it also introduces a slew of new issues.

The Need to Have Other Types of Blockchain Technologies

A public blockchain is not accessible to everyone, including businesses. This is due to the fact that they are unable to make every aspect of their business public. They do have some critical data that contributes to the success of their business. If it becomes widely known, competitors will use it.

Private or federated blockchain emerged to address the aforementioned use-cases. Private blockchains provide a completely private environment in which the organization controls who participates. This allows them to benefit from blockchain features without having to make everything public.

To summarize:

The first-generation blockchain had a number of shortcomings, including inefficiency and scalability.

Furthermore, it is a public blockchain, which does not fit everyone’s agenda or need.

These two factors can be viewed as the foundation for advancement in various types of blockchain technology.

Different Types of Blockchain Technologies

There are four different major types of blockchain technologies. They include the following.

Public
Private
Hybrid
Federated

Public Blockchain Technology

A public blockchain is a distributed ledger technology that allows anyone to join and conduct transactions. It is an open version in which each peer has a copy of the ledger. This also means that anyone with an internet connection can access the public blockchain.

The Bitcoin public blockchain was one of the first to be made available to the public. It allowed anyone with an internet connection to conduct decentralized transactions.

Examples of Public Blockchain: Bitcoin, Ethereum and Litecoin.

Private Blockchain Technology

A private blockchain is a blockchain that operates in a restricted environment, such as a closed network. It is also a permissioned blockchain controlled by an entity.

Private blockchains are ideal for use within a privately held company or organization for internal use-cases. This allows you to use the blockchain effectively while restricting access to the blockchain network to only a few participants.
It differs in the manner in which it is accessed. Otherwise, it provides the same set of features as the public blockchain, including transparency, trust, and security to the chosen participants.

Another significant difference is that it is somewhat centralized, with only one authority overseeing the network.

Examples of Private Blockchain: Multichain, Corda

Consortium Blockchain Technology

A consortium blockchain (also known as Federated blockchains) is a novel approach to meeting the needs of organizations that require both public and private blockchain features. Some aspects of the organizations are made public in a consortium blockchain, while others remain private.

The preset nodes in a consortium blockchain control the consensus procedures. Furthermore, despite the fact that it is not open to the general public, it retains a decentralized nature. How? A consortium blockchain, on the other hand, is managed by multiple organizations. As a result, there is no single force of centralized outcome here.

In short, it provides all of the benefits of a private blockchain, such as transparency, privacy, and efficiency, without relying on a single party to consolidate power.

Examples of Consortium Blockchain: Marco Polo, IBM Food Trust

Hybrid Blockchain Technology

The term hybrid blockchain may sound similar to consortium blockchain, but it is not. However, some similarities may exist between them.

A hybrid blockchain is a combination of a private and public blockchain. It has applications in organizations that do not want to deploy either a private or public blockchain and instead want to deploy the best of both worlds.

Example of Hybrid Blockchain: Dragonchain, XinFin’s Hybrid blockchain

In Summary

Every blockchain has something special to offer. As a result, there is no simple answer to the question of which type of blockchain to use.

In general, if you are a company and want to use blockchain without making everything public, it is a good idea to use private blockchain.

Furthermore, if you want more transparency in your network, a public platform is a good option. However, they are not well suited for enterprise use cases.