What are Public & Private Blockchains?

What is Public Blockchain?

We’ve all heard about Bitcoin, Ethereum, and the countless blockchain technology projects that are emerging. And while they all have their own respective benefits and applications, there is a type of blockchain technology that allows data to be encrypted between participants and transferred without being compromised and called a Public Blockchain.

With this particular technology, every participant must have access to the whole public blockchain, and if there are any changes made to the information on the ledger, all the users will see the change instantly. This can be considered to be a “Secure Blockchain” where anyone could access but they are not allowed to alter or delete any data.

Public Blockchain

It would be more difficult to hack a Public Blockchain since only a certain amount of people would have access to the information.

Because Public Channels can be used in simple transactions like digital payments, governance, sharing of information, and other routine operations, businesses can integrate a Private Blockchain into their services to separate access from the knowledge of the information shared. As noted, Private Blockchain networks also create opportunities for peer-to-peer interactions in financial services, utility, and logistics.

How do you create a Blockchain?

If you have read our primer on blockchain technology, then you are probably aware of the decentralized approach of blockchains, meaning that no single entity or individual owns or controls the network.

Individuals, businesses, and other organizations can join the network and release their own specialized version of a blockchain.

With a Private Blockchain, you will have access to your own blockchain network, which you can use to store, share and develop your data.

What is Private Blockchain?

Private Blockchain networks are often referred to as the infrastructure layer of a blockchain and are designed to be simpler to manage and use. However, they also come with an added cost, since they are hosted on private networks rather than the public internet.

Private Blockchains are implemented by managing a server that acts as a portal for participants of the network to access and interact with the blockchain. It might sound a bit complicated, but it is actually very simple to set up a Private Blockchain.

One option you can use to create a Private Blockchain is the use of a fully managed hosting provider that will manage, maintain and store your Private Blockchain network. This option will cost you a bit more, but you will be in full control of how your data is being stored, and the level of access you have to the network.

Private Blockchain Servers

The second option, and also the most common one, is that you will be able to create a fully-managed Private Blockchain, based on open-source software (such as Bitcoin or Ethereum), and hosted by trusted cloud providers such as Amazon, Digital Ocean, or on your own VPS (Virtual Private Server) infrastructure.

The advantage of using managed hosting providers is that they have the required IT infrastructure to host your Private Blockchain server, and you don’t have to manage the day-to-day operations, but you do have to pay a higher monthly fee.

What you need to build a Private Blockchain?

To build a Private Blockchain, you need the following:

A Private Blockchain client which can manage and store your blockchain data.

A Blockchain administrator who will be able to manage a Private Blockchain and release data.

A Private Blockchain server which you will be able to manage, and eventually release data.

Web-based user interface for sending and receiving transactions.

Web-based user interfaces for viewing the blockchain.

Basic knowledge of the software installed.

What to use to build a Private Blockchain?

The most popular Public Blockchain software is Ethereum (you can read more about it in this guide). You can read more about Ethereum and its features in this guide.

Ethereum

Ethereum is another open-source, public, distributed Blockchain platform. It is an open-source, public, and distributed computing platform running smart contracts. This is an attempt to make Blockchain, Smart Contracts, decentralized computing, and decentralized financial applications that are robust enough to replace centralized platforms like PayPal.

Ethereum uses Smart Contracts, which are contracts written in computer code. Ethereum uses smart contract programming to run trustless applications without the need of a trusted third party (such as the bank) or central authority.

Since Smart Contracts can perform actions that no one in the world can change, Ethereum allows its users to create any type of application or business involving decentralization.

Why is Ethereum Important?

Open Source, Public, Distributed – The bitcoin blockchain is public, open, and distributed. Smart Contracts, the heart of Ethereum are decentralized. Ethereum uses Smart Contracts to run decentralized applications without the need of a trusted third party (such as the bank) or central authority.

  • The bitcoin blockchain is public, open, and distributed. Smart Contracts, the heart of Ethereum are decentralized.

  • Ethereum uses Smart Contracts to run decentralized applications without the need of a trusted third party (such as the bank) or central authority. Decentralized Applications – Ethereum makes it possible for users to create decentralized applications (dApps).

  • This can be useful in creating peer-to-peer trading applications, smart property wallets, decentralized storage applications, and many more.

  • Ethereum makes it possible for users to create decentralized applications (dApps). This can be useful in creating peer-to-peer trading applications, smart property wallets, decentralized storage applications, and many more.

  • Decentralized Infrastructure – Distributed databases can’t be controlled by anyone party because they are distributed. The Bitcoin blockchain has been used to store credentials, identities, and other sensitive data. Ethereum, on the other hand, could be used to host decentralized services in a distributed manner.

  • Distributed databases can’t be controlled by anyone party because they are distributed. The Bitcoin blockchain has been used to store credentials, identities, and other sensitive data.

  • Ethereum, on the other hand, could be used to host decentralized services in a distributed manner. Decentralized Applications – Decentralized applications are decentralized, and not controlled by a central authority. For example, the Bitcoin blockchain is used to store credentials and identify data.

  • If a centralized party wanted to breach this network, it would take a lot of time to make its way in. For example, to hack MtGox would require years of work to breach the various parties involved.

  • In a decentralized application, such as Ethereum, the system will never allow one party to breach the security of the network. It can be done in minutes, which is difficult to do with a centralized infrastructure.

  • Decentralized applications are decentralized, and not controlled by a central authority. For example, the Bitcoin blockchain is used to store credentials and identify data.

  • If a centralized party wanted to breach this network, it would take a lot of time to make its way in. For example, to hack MtGox would require years of work to breach the various parties involved.

  • In a decentralized application, such as Ethereum, the system will never allow one party to breach the security of the network. It can be done in minutes, which is difficult to do with a centralized infrastructure.

  • Decentralized Financial Applications – Ethereum is capable of running decentralized financial applications, such as the Smart Exchange of Ethereum, which would allow the transmission of fiat currency in a fully secure, decentralized, and anonymous manner.

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