Private & Public Blockchains

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Overview
Difficulty
Intermediate
Duration
40m
Students
54
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5/5
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Description

This course explores the theoretical side of blockchain technology as well as the practical elements. You'll learn what the blockchain is and the difference between private and public blockchains. We'll also cover smart contracts, and Web 3.0.

Transcript

Welcome to this lecture in the course where we're going to be discussing private and public Blockchains. This will help you to further understand the constructs of Blockchains. So, by now, you know lots about Blockchain technology and you also know that Bitcoin is built upon a public Blockchain. But did you know that there are two other types of Blockchains as well? In addition to public Blockchains, there are also consortium Blockchains and private Blockchains. Let's kick this lecture off by first reinforcing what we know about public Blockchains. These Blockchains are most commonly known to the masses due to the rise of Bitcoin. So, with Bitcoin as it is based on a public Blockchain, anyone in the world can download the entire Blockchain and essentially read the data. With Bitcoin you can see the amount of Bitcoins sent to and from certain addresses and so on. What I'm trying to get across is that with public Blockchains it's fully public. Though that doesn't mean insecure as it's secured by the power of cryptography, it's part of the fully decentralized nature of Blockchain technology. Now I'd like to move on to consortium Blockchains. This sort of Blockchain isn't fully public, so me, you, or anybody can't just get involved. A consortium Blockchain is controlled by a preselected set of notes i.e computers. The best way to visualize a Consortium Blockchain is to let's say imagine 10 banks that run that Blockchain, all of them being preapproved unlike with a public Blockchain. Then for any block to be processed by the chain, a minimum of say, six banks must sign that transaction off. It can then be added to the chain. But remember only those 10 banks can sign the transaction, no others. And with regards to viewing the transactions, it is up to the consortium to slide what level of access and transparency to offer to outsiders. A good example of potential use for consortium Blockchains could be medical records or voter records, which should only be able to be verified by a selected group of computers, but which may need to be publicly visible depending on the situation. Now, these consortium blockchains are considered partially decentralized, not fully decentralized as the public blockchains are. And finally we have private Blockchains. This is actually a taboo topic, as many don't feel these are actually legitimate Blockchains, private Blockchains, as the name suggests, private, all the permissions for the Blockchain are kept centralized. So, let's do the bank example again, all permissions would be kept to that one bank and its own computer around the world. Now, Blockchain technology is typically decentralized, so centralizing it does bring out the critics. For the most part, these are the block chains banks are experimenting with. The most likely applications for private Blockchains include the likes of database management, auditing, and basically anything that is internal to that company. So, when the critics come out on the topic of private Blockchains, the opposing party generally express their view of it being necessary to be private. So, those are the three types of Blockchains you need to be aware of: public Blockchains, consortium Blockchains, and private Blockchains. As Blockchain continues to become more and more integrated into commerce and governance, you'll definitely see each of these being expanded upon and implemented in unique and interesting ways. See you in the next lecture where we'll discuss just how this Blockchain technology can be applied in many use cases, not just cryptocurrencies.

About the Author
Students
269
Courses
8
Learning Paths
1

Ravinder is an expert instructor in the field of cryptocurrencies and blockchain, having helped thousands of people learn about the subject. He's also the founder of B21 Block, an online cryptocurrency and blockchain school.

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