Research & Blogs
4 Different Types of Blockchain
Blockchain is a technology that allows online transactions and data to remain immutable and secure. Blockchain networks manage the databases that store the data from transactions in which participating users engage. Keep reading to learn more about the different types of blockchain networks that exist.
Public blockchain networks often refer to permissionless networks that any user can participate in. Any individual in the world may choose to join the network, view, and/or transact on this network. This allows for high decentralization of public blockchain networks: they do not have a central authority that oversees the entire network and the transactions1. As a result, no single user has complete control over the network and network’s data. Furthermore, they usually support anonymity: participants’ transactions, data, and general activity cannot be traced back to them.
Even though no one can connect a user’s real identity to their network activity, all transactions are public within this type of blockchain2. Therefore, as there is no administrator that can restrict access to the blockchain data, it is very challenging to achieve data privacy on this type of network. It is possible to set up a permissioned public blockchain too. The difference with public permissionless network is that not all the users can join the blockchain network and submit the transactions, yet everyone can access the data from the blockchain.
Private blockchain networks are permissioned blockchains that require users to have an invitation to join them. Governance in private networks is centralized, which means they do have an entity that regulates network activity and access to the data on the blockchain (unlike public blockchains). Transactions can only be submitted and seen by the users within the private network, and because there are a limited number of participants viewing said transactions, the network ensures privacy of the data and remains more stable than a public blockchain3.
Hybrid blockchain networks refer to the combination of public and private elements within the networks. With hybrid blockchain, companies can create a private, permissioned network that works in parallel with a public network. This enables to determine what information is to be kept public and private and which users have access to certain data. Hybrid blockchain networks are less transparent because transactions are not generally accessible to all users like they are in completely public networks4.
Consortium blockchain networks are somewhat similar to private networks. They differ, however, because the network governance is decentralized: a group, or consortium (hence the name), of entities manage the network instead of one enterprise like in private networks5. This is best for organizations that want to use the blockchain for enterprise activity. These networks can be harder to set up and govern, as multiple groups need to be organized and assigned access controls across the network. Consortium blockchain networks ensure a higher level of privacy and tend to be more efficient than public networks6.
Gilded and Blockchain
Gilded uses private blockchain to ensure immutability of the transactions and therefore reliable ownership of an investor’s gold. Our permissioned, independently audited blockchain network is just one of the ways that Gilded guarantees security for your investments. Learn more about the Gilded offering here.
1 Learn with Whiteboard, “Types of Blockchain Explained | Blockchain Types, https://www.youtube.com/watch?v=FcfPU3rYVAk” Accessed 11/24/22.
2 Cointelegraph, “A beginner’s guide to the different types of blockchain networks, https://cointelegraph.com/blockchain-for-beginners/a-beginners-guide-to-the-different-types-of-blockchain-networks” Accessed 11/22/22.
3 Cointelegraph, “A beginner’s guide to the different types of blockchain networks, https://cointelegraph.com/blockchain-for-beginners/a-beginners-guide-to-the-different-types-of-blockchain-networks” Accessed 11/22/22.
4 Simplilearn, “The Complete Guide for Types of Blockchain!, https://www.simplilearn.com/tutorials/blockchain-tutorial/types-of-blockchain“ Accessed 11/28/22.
5 Cointelegraph, “A beginner’s guide to the different types of blockchain networks, https://cointelegraph.com/blockchain-for-beginners/a-beginners-guide-to-the-different-types-of-blockchain-networks” Accessed 11/22/22.
6 Simplilearn, “The Complete Guide for Types of Blockchain!, https://www.simplilearn.com/tutorials/blockchain-tutorial/types-of-blockchain“ Accessed 11/28/22.