Tech Talks: Why do Industries Choose to Use Private Blockchains and the Hybrid Solution
In our first Tech Talks article, we’ve introduced private and public blockchains and focused on their main differences. In this second article, we’ll discuss the main reason why people use private blockchains and the hybrid solution.
In our previous article, we’ve highlighted private blockchains’ features and especially its tighter joining requirements: that’s what makes them ‘private’. When choosing between private and public blockchains, people tend to go towards private blockchains if they want to keep their data private because they believe in the following misconception:
‘All my data is private on the private blockchain’
Not necessarily: again, this depends on how you store data on the blockchain. Sure, on the private blockchain you can decide to allow certain parties to join the network. However, once access is granted (i.e. permission to run a node) it is not possible to set permissions as to which pieces of data can be accessed.
What does that mean?
It means that you must be aware that giving permission to access a private blockchain to somebody is an all-or-nothing bargain: once they’re in, they can see everything stored on that blockchain. As a matter of fact, the Wolf and the Seven Little Goats’ moral of the story has never been so fit: ‘You have to be careful who you let in’.
Blockchain and Privacy Laws compliance
In addition to that, another issue has arisen in recent months regarding privacy and blockchains: privacy law enforcement. Nowadays, everything we do on the Internet — every website we visit, every research we make on a browser, every IP address we use — can be digitally stored and associated with you. In order to protect personal information, authorities have created privacy laws such as General Data Protection Laws (GDPR).
Privacy laws and blockchain technology have a similarity: they are meant to enhance data protection. However, there are two main aspects to privacy laws: the right to keep your data private and the right to erasure i.e the right to erase personal data on the Internet.
Yet, storing data on a blockchain makes it immutable by nature… which makes blockchain technology non-compliant to privacy laws.
Hybrid to the rescue?
To read the full article, please visit our official blog: https://luxtag.io/tech-talks-why-do-people-choose-to-use-private-blockchains-and-the-hybrid-solution/