The Difference Between Public And Private Blockchain

Posted By : Rajat Kesharwani | 27-Mar-2018



The public blockchain is follows the truly decentralized network, which means there is no any central network to controls the entry of the members on the network and the consensus mechanism is democratic. A mechanism of consensus means that all users can become a minor and that these minors are in competition to add the blocks to the blockchain.


But this decentralization of has the following points:


The limited size of the blocks: We can add only limited number of transactions per blocks, which is the limitations to the speed of adding transactions to the blockchain.


A cost per transactions which can be high: Minors only participate in the process of mining the blocks because they hope to get the rewards (coinbase and fees). The minors can also share his rewards to the others.


The transactions added to the blockchain are public: Any transactions is added into the blockchain in public. It can be accessible to all the peers which is connected to the blockchain network.




The private blockchain is deal with the truly centralized network. The consensus mechanism is centralized i.e. it has the hands of a single server network which mission is to verify and add all transactions to the blockchain. A network based on a private blockchain, therefore does not need to use a mechanism such as “Proof of Work” (POW) or “Proof of Stake” (POS) or “Delegated Proof of stack” (DPOS) which are complicated to implement and expensive.


Private blockchain consensus has several advantages:


Manipulation of the private blockchain: This is possible to come back at any time on the transactions. The transactions that has already been added in to the blockchain and therefore change the balance of the members. In the public blockchain, this operation is require that 51% of the hashing power is concentrated in the hands of the same entity.


An absence of fees: Here the mining process is not competitive in private blockchain because data is centralize and there are no minors to remunerate, there are no costs and rewards attached to transactions.


Much faster consensus: the fact that the consensus mechanism is centralized makes it faster, because it is working on single peer & single system. That means there is a centralized network.


Private data: The entity charge of the administration of the blockchain may decide the control who can enter the network or not and if the transactions will be public or not.

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