Blockchain is the technology of the future and the latest buzz because of its multitude of benefits. It is a distributed ledger with stored information in chronological order. The data is easily traceable by companies because of time stamping. Blockchains have gained popularity because of cryptocurrencies like Bitcoin. It also picked up amongst ‘cyberpunks’, non-believers of the financial system, and digital natives. Cryptocurrency is just one application of the technology in the enterprise sector. This is where private blockchains enter!
There are three types of blockchain – public, private, and federated; private being the popular type. Companies use them according to their needs and characteristics. Using a private blockchain with the public or federated system isn’t successful unless the kind of private blockchain platform being used is known. This article will help you to know all about private blockchains, so let’s begin!
Learning of the Blog
- What is a private blockchain?
- Real-World Applications
It would be helpful to start a blockchain course or blockchain training along with these resources if you are new to the world of blockchain technology.
What is Private Blockchain?
To look at the rise of private blockchains, it is essential to know about it first. In a private blockchain network, only a single organization or authority has control over the network.It might like a centralized network that does not resonate with the basic concept of blockchain, but it can offer partial decentralization. This type of network is well suited as an internal technology for an enterprise because entry without reason isn’t permitted. Nowadays, as everything depends on technology- previous ones can’t keep up with changing times leading to data theft, identity hacking, and more. Therefore, private blockchains are the perfect option to safeguard a company’s sensitive information as, without proper authentication, no one can enter the network. For the sake of secrecy, many blockchain companies are moving towards a private version of the technology. While cryptocurrencies are fully transparent, to fully reap the benefits of a distributed ledger without opening up to the public a permissioned a.k.a. A private blockchain is required.
Here, we list down the best features of private blockchains sought after by blockchain professionals:
If the primary demand is privacy instead of full disclosures, then private blockchain is the technology for you. When dealing with sensitive information, it is challenging to keep everything at bay because of cyberattacks. Thus, enterprises need privacy and security. It is impossible to hack into a system if the company tightens up its security facilities using a private blockchain.
Private blockchain platforms offer the most elevated level of efficiency and work better than public blockchain platforms where there is no limit on several nodes. This is because only a handful of pre-authorized nodes get entry, so there is no way nodes take up more resources than usual. The private network is immune to system slowdowns.
Private platforms offer the best performance because they are more stable and scalable. For a business to work, it has to grow with time, but in a public blockchain, it also starts to slow down. Private blockchains don’t face this scalability issue; instead, they result in a reduced fee and faster transactions.
Private networks have robust network structures and are made to be resilient to issues. This offers them security protocols at a level that can keep malicious activities at bay. Some platforms use firewall type features to protect all the information from outside and inside presence within the ledger. This allows the organization to alter the transaction, but it is highly unlikely to go unnoticed.
Maintaining a private system is simple and doesn’t need much attention, thus saving many resources. Compared to other efficient technologies, private blockchains take up only a handful of resources, saving a lot of workforce and money.
There is no minimum transaction fee, and these blockchains might not have a native token for the network. The negative impact of cryptocurrencies is not present here.
Enterprises cannot work without a regulatory system, and so there should be a proper way of performing tasks. Thus, an excellent reason to use a private blockchain network is the regulations.
No Illegal Activity
Private blockchains are very selective, and as a result, it limits criminals and is not responsible for illegal activities.
Empowering Enterprise Companies
A private network focuses on the overall benefits of an organization and not individuals. This ensures increased revenue and global growth.
Walmart and other household names like P&G, FedEx, and Nestle realized that private blockchains are game-changing and thus implemented the technology in their business processes. Walmart’s blockchain system is based on Hyperledger fabric to trace their product’s provenance. The blockchain permits the supplier to authenticity certificates for secure ledgers and bringing trust to the system. The company is further looking to roll out with more products.
- De Beers is using a private blockchain called Tracr for a ‘secure and immutable trail’ that verifies the authenticity of diamonds to ensure they aren’t blood diamonds and their provenance.
- Comcast, in partnership with other leaders of the industry, launched a blockchain-based system called Blockgraph to allow advertisers to target viewers while maintaining the viewer’s privacy.
- In the healthcare industry, a big data blockchain platform by BurstIQ helps doctors and patients transfer sensitive medical information securely. It uses smart contracts that establish data sharing parameters.
- Spotify, the streaming giant, acquired Mediachain- a blockchain startup in 2017 to create a fair, rewarding, and transparent music industry. The technologies developed by Mediachain developed a decentralized, peer-to-peer database connecting applications to media and cryptocurrency that reward artists’ work.
- In real estate, the all-in-one transaction management software Propy uses blockchain technology for streamlining real estate transactions and mitigating the risk of fraud.
As we have seen in this blog, there are many private blockchain-based solutions working with high-level efficiency, making it one of a kind. Private blockchains are much more than glorified centralized database systems. So, make sure to check out the blockchain certifications program for this type of blockchain.