Currently, with its’ three most popular types of blockchain architecture, blockchain’s inherent versatility is one of the main factors behind its growing implementation in the global technology solutions space.
Blockchain seems to be settling in more and more these days. With mounting instances of adoption, we’ve got news of companies such as JP Morgan and Facebook issuing their own cryptocurrencies, industrial giants like IBM and Carrefour transforming their respective sectors and even some serious governmental interest to top off business demands* links
Given the continuous flow of adoption news and technology headlines, it should come as no surprise to also see reports showing a significant increase in blockchain spending for 2019, up nearly 90% from last year’s $1.5 trillion global expenditure estimate.
And only when we think we start to understand how they function, it turns out there’s more than one of them! Blockchain’s general technological merit aside, the variety of applications across multiple industries is further explained through the very design of blockchain networks.
When looking into how network transactions are validated or, in other words, who and to what extent is able to be part of the network, we can easily see how blockchain can provide a whole new layer to the current digital and internet infrastructure.
Types of Blockchain – The Big 3
Public blockchains are the most decentralized and transparent version of all three blockchain types. With no central authority in charge, they are by default open for participation to anyone with an interest in the network. Any inter-connected node is, therefore, able to directly mine on the blockchain with the ability to execute, review and audit transactions.
The openness and transparency of public blockchains are one of Distributed Ledger Technology (DLT)’s most characteristic features and it makes up for a design best suited for large scale decentralized projects. Having an open bar policy for every developer additionally translates into extra computing power on a regular basis, making public blockchains relatively sustainable if generating enough interest.
Talking application, the most prominent example is the Bitcoin network, the very first iteration of what we know today to be an open-source global public blockchain simultaneously maintained by a large group of developers with a common vision. The close second (in value and popularity) is the Ethereum network, which is also open-source and able to tap into vast resources of human and computing power.
And while you could consider the above examples as more of social ventures, public blockchains draw significant interest from both private and public bodies as well. Specifically, those with an angle of vested general public interest (think governments, state agencies, social enterprises, etc), are increasingly looking at blockchain solutions that promote an open culture of transparency and disclosure.
Private blockchains are…Well, the name kind of gives it away, but yeah – they’re private, just so we’re all on the same page here.
To one’s oftentimes peepshow, a good deal of cryptocurrency and blockchain natives tend to freak out when they hear the term ‘private blockchain’ and enter into debate-inducing, neither too rare discussions with (or against) other community members.
What, this wasn’t the initial plan, it’s got to be all open and stuff!
While there is indeed a certain degree of truth to that, the technology always evolves and it’s natural to continue finding new ways to adapt it to our needs. Private blockchains are exactly that – a reiteration of an initial concept with its own function and an important part to play in the whole scheme of things.
Control over transaction management within private blockchains is typically centralized and vested into a central overseer, in addition to the select participants who can view, audit and change the ledger. DLT, in this case, is, in essence, being used as a fully-fledged database. A great example of a private blockchain is
With full internal control on hands, private blockchains’ most common application scenario is the improvement or migration of existing storage infrastructure. Their implementation is most suited for organizations that are looking to have themselves an upgrade from traditional internal processes. When designed correctly, private blockchains can be easily utilized to improve organizational efficiency and bring an enterprise’s decision-making systems a step closer to being optimized and automated.
Coming in last (but not least!) in the list is the consortium blockchain, a hybrid architecture, and safe-haven for all those seeking a sort of a middle ground between the public and private camps. Just as its public counterpart, consortium blockchains rely on consensus. And just as its private one, the network assigns a select group who collectively exercises total control over the network’s governance structure.
Consortium blockchains are by design very flexible and can be designed in various different ways, depending on each specific use case. Given the variety of options at a company’s disposal that they offer, it comes as no surprise to have consortium blockchains the current go-to architecture for enterprises.
Consortiums are unique in themselves because of how they allow businesses to have a one-stop-shop for all things internal communication, decision making, and operations. Consortium blockchains do not solely link all relevant stakeholders together, but they also make the lives of executives and incumbents easier by strengthening the control they have over decisions.
When discussing consortium type of blockchains, there is no way to go around and not mention projects like Hyperledger and Corda. Specifically designed for widespread application within business, development on the Hyperledger and Corda platforms is already having a significant impact by rolling out market-validated enterprise solutions.
And honestly -that’s just the start, we’re still early in the process…
Blockchain’s first conceptualization in Bitcoin was only a mere 10 years ago. As the technology evolves, it is highly likely to encounter other emerging types of blockchains that are better equipped to tackle specific problems.
For now, though, we’re running with the above three types of blockchain. And one thing we’d really like to stress out here is that there is no one-size-fits-all when it comes to blockchain. As beneficial as it could be, an enterprise-grade blockchain solution must be carefully designed to fit its particular purpose. From a business point of view, there are many things to take into account when choosing the right blockchain – from team dynamics to market demands, internal operations, digital infrastructure, regulation and so on.
This is also the driver behind LimeChain’s dedication to continuously innovate – understanding the ins and outs of blockchain’s technological and business implications to build sustainable, working solutions and meet staggering market demands. Our recent partnership to build atop of Corda’s development platform is a further step in the right direction as we continue to look for ways to improve and widen our services portfolio.
Have plans for your own blockchain?
Get in touch via email@example.com and let’s jump on a call to discuss how that would look like.