2 minutes to understand the difference between public and private Blockchain
Blockchain is a distributed ledger technology designed to allow secure and transparent data transactions without intermediaries. The information that is recorded is timestamped and immutable, meaning that no one can modify or delete it. Blockchain technology can be segmented into different types: private and public Blockchains. In this article, we will discuss the differences between these two types of Blockchains.
A private Blockchain is a permissioned Blockchain network operated by a single organization or a group of organizations. Private blockchains are designed to allow only authorized participants to access and validate transactions on the network.
The main advantage of private Blockchains is that they offer a higher level of security and privacy than public Blockchains. Because the identity of the users is verified before they are granted access to the network, this makes the network more secure and less prone to attacks or fraud. Private Blockchains are used by organizations that need to share sensitive information among a limited group of participants, such as banks, insurance companies, and healthcare providers.
Private Blockchains use rules to validate transactions, or called consensus algorithm, that are different from those used in public blockchains. This allows for faster transaction processing and lower to no transaction fees.
A public Blockchain is a 'permissionless' Blockchain network that is open to anyone who wants to participate in the network. Public Blockchains are designed to be transparent and decentralized, with no central authority controlling the network.
The main advantage of public Blockchains is that they are highly secure and resistant to censorship (as there is no single point of failure). As all transactions are recorded on the Blockchain and can be verified by anyone, it makes the network more transparent and immutable. All data is publicly visible to anyone who wants to access it, ensuring full decentralization.
Public Blockchains use specific consensus algorithms designed to ensure that all participants in the network agree on the state of the ledger. This requires high level of computational power and energy consumption, which can result in higher transaction fees and slower transaction processing times.
Public Blockchains are often used for cryptocurrencies, such as Bitcoin and Ethereum.
In summary, private Blockchains are permissioned networks that offer a higher level of privacy and security, while public Blockchains are permissionless networks that offer more transparency and decentralization. Each type of Blockchain has its own unique features and functionalities, and the choice of which type to use depends on the specific needs of the users.
Zoom on TEO-The Energy Origin
TEO-The Energy Origin uses a public Blockchain combined with specific mechanisms to encrypt confidential data and ensure GDPR compliance with a high level of security, offering a good balance between privacy and transparency.
More specifically, TEO uses the “Energy web chain”, a public Blockchain platform operated by the Energy Web Foundation with Proof of Authority consensus, allowing to reduce de energy intensity of the process, and therefore, limiting our environmental impacts.
Check out the rest of our blog to know more about Blockchain, Energy worlds, Traceability and Sustainability: The Energy Origin - Blog