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Myths, Realities and Future

10.2.2  Types of Blockchain

An understanding of the types of Blockchain networks is vital for achieving back­

ground knowledge of Blockchain and how to implement it for cryptocurrency

(Sharma, 2020).

10.2.2.1  Public

This is a Blockchain that has an open network where the data is accessible to all, and

thus, anybody can contribute to the agreement procedure. It is permissionless, and

thus, anyone can interpret, read and transcribe data on the Blockchain. It is distrib­

uted and trustless and doesn’t have a sole organization that regulates the network.

The data here is safe, as it becomes impossible to change or modify data once the

data is authorized on the Blockchain. Bitcoin and Ethereum are popular models of

this type of Blockchain.

10.2.2.2  Federated

This Blockchain doesn’t permit everybody to contribute to the consensus process.

Only a partial number of nodes are authorized to do so. Access to the Blockchain is

either public or limited to members. This is suitable for smaller teams. Hyperledger

and Corda are models of a consortium Blockchain.

10.2.2.3  Private

A private Blockchain is an invitation-only Blockchain. This is administered by a single

entity. These are typically used in a business. Only particular associates are permitted

to access it and perform transactions. This is an authorized Blockchain. It is based on

access controls that specify the public that may contribute to the system network. Some

entities regulate the network, and this gives rise to trust on third parties to perform

transactions. Here, only the actors contributing to a transaction will possess informa­

tion about it, while others will be unable to access it. It is more vulnerable to threats,

hacks, and data breaks. Linux Foundation Hyperledger Fabric is the best illustration of

private Blockchain. Public Blockchain appears to be the prominent choice; it is imple­

mented in most use cases, since it is not restricted by limited access. Amalgamating

public and private Blockchains signifies feasible solutions for companies.

10.2.3  Benefits of Blockchain

10.2.3.1  Better Transparency

Blockchain is based on a distributed ledger, with all network participants sharing

the same text, which can only be updated accordingly. To modify a single transac­

tion record would require a change in all succeeding records and the collusion of the

entire network; this gives rise to better transparency.

10.2.3.2  Improved Security

Blockchain offers improved security, as transactions need to be agreed upon prior

to being recorded. Once a transaction is approved, it is encrypted and linked to