These are the main differences between a public and a private blockchain

[Buenoscoin]

Despite having been released since the launch of Bitcoin, as we have said on other occasions, the origin of the blockchain is a little older. Of course, the rise of cryptocurrencies has included a revolution in our times, mainly due to the fact of promoting a new form of registration in which there is no need for external ones.

Let's review a little. Commonly, we entrust our money to a bank, which is responsible for saving it and approving and recording the transactions we make with it. Of course, this will be charged commissions, which are usually quite high and, depending on the case, we must wait for some time for the operations to be effective. So that entity, supervised by a government in turn, will keep in its own accounting books a record of all transactions made by its users, and these will only be responsible for carrying them out, paying for said work, trusting the bank and waiting to be processed. We call this centralization.

Blockchain technology, also known as blockchain, works like a digital ledger. When one person transfers money to another, this represents a transaction. The miners of the network group the transactions in blocks, which contain information of the same: date, amount, address of the wallet, among others; but in order to be added to the chain, it is necessary that they be verified. For this, a kind of competition is carried out in which the miners solve a mathematical problem of great complexity, and whoever completes it first will manage to add the block of transactions to the chain and, in addition, obtain a reward for said work.

This is the most fascinating part. Each block that is added to the blockchain has its own hash, a unique identification number that condenses all the information contained in them. In turn, this is linked to the hash of the previous block, and the same does the following, creating an unalterable structure. Why? Well, if someone tried to change the verified data in a certain block, for example, the address of the receiver of a certain transaction, this would change the hash of that block and break the chain.

In this way, we have a network in which not only a high level of security stands out, but the absence of intermediaries to guarantee it. They are the same members of the same who are responsible for updating, through what we know as work tests (PoW) and evidence of participation (PoS). These function as consensus mechanisms that in a certain way allow the community to reach an agreement without the need for a mediator. So, unlike the process to which we are accustomed, the chain of blocks works in a decentralized way.

Now, having raised all this, it is a bit curious to mention that there are three types of blockchain, classified precisely according to the participation in them. In this sense, we can mention: public, private and federated. Given that in other opportunities we have explained the operation of this technology, in this article we will focus on comparing the first two. Let's briefly define each one.

Public blockchain

A public blockchain, also called open, as its name implies, is one in which anyone can join the network and collaborate with the update of the chain. This means that any member of the community in question can review the information contained in the verified blocks and participate in the verification process of the operations without any type of restriction.

Private blockchain

A private blockchain, also known as a closed blockchain, is one that is owned by an individual or institution, which is why it is not allowed for anyone to enter the community and add blocks to the chain. In fact, to be able to join the network, it would be necessary to receive an invitation from the developers of the same.

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[Danus]

Yes, if you want more income, then of course, but it is worth thinking about the losses, as you do not always know when to sell. Good day!