What are the Different Types of blockchains – Simply Explained
The world first became acquainted with Blockchain thanks to the creation of Bitcoin.
Over the years, various industries such as healthcare, real estate, politics, etc., have tried to adopt Blockchain technology. And because each industry works uniquely, Blockchain has had to evolve into different types.
We have a dedicated article on what exactly is blockchain technology. You can find it here.
In today’s topic, we will talk about the different types of blockchains and where they can be used.
There are four types of blockchain structures:
These types of blockchains are designed exclusively for private organizations and business development. They are centralized and closed to the public. Maintenance and control are performed by the creators, and the whole system is subject to corporate laws and principles. Private blockchains are mainly used in private organizations to store sensitive information that should only be accessible to certain people in the organization. Because a Private Blockchain is a Closed Blockchain, the data is within the organization and is inaccessible to external entities.
The public block is open to anyone who wants to join it. Anyone can start mining, as the administration is the responsibility of the community as a whole. Examples of public blockchains are Bitcoin, Ethereum, and Litecoin.
A blockchain belonging to a specific consortium is controlled by a pre-selected number of defined nodes. Access to it can be accessible to all users as well as to a certain number of participants. It is possible to create hybrid platforms where root hashes will remain available to all users, but the number of requests and confirmations of transactions will be limited, indicating partial decentralization of the system.
Hybrid blockchains are those that are managed by a single entity but have some supervision from the public blockchain, which is imperative to make certain transaction validations. Generally, a hybrid blockchain works by using a private network to generate hashed blocks of data, which are then stored publicly without compromising data privacy.
Where blockchain can be used?
So far, the open register is used only in private surveys. However, using blockchain-based technology when voting will reduce the likelihood of counterfeiting to zero.
The new technology will eliminate intermediaries to save money, simplify the transfer of ownership of various real estate, make equity investments in the real estate sector, facilitate the procedure for collective bargaining in residential buildings, and more.
Transactions will be more transparent. Blockchain can increase the speed of money transfers and develop new types of credit and payment systems.
Due to the inability to make changes to existing data, organizations, companies, and even countries will be able to get a reliable way to store important information.
Blockchain can aid in the development of innovative solutions in the field of electronic document management, as well as the creation of user-friendly platforms for public voting, public tenders, and other applications.
Blockchain can increase supply chain dependability, efficiency, and transparency, cut costs by lowering the number of middlemen and allow for the tracking of items’ origins, among other things.
These are just a few examples of the many possible applications of this innovative technology, that will enter our lives in an increasing number of different ways.