It is no secret that bitcoin is a huge business. Unfortunately, many people still don’t grasp the basics.
Blockchain and bitcoin have created a buzz in the financial industry for years. But now, thanks to a range of investment opportunities, it became very enticing for the general public.
Something that makes blockchain so exciting is that no one can agree on how big it will be.
There are a few things that you should know about bitcoin before you get started.
Public Blockchain
If you want to create a blockchain that enables anyone to join, then the public one is the perfect selection for you. Public blockchain allows others to contribute to the network. Anyone is free to join and take part. A public blockchain is self-governed in nature, meaning that people are free to join, leave, edit, and audit the ongoing activities.
A Public Blockchain Has a Range of Benefits
- Secure transactions
- Immutable ledgers
- A bitcoin or Ethereum breach has never happened
- No central bank that controls transactions
- Scales at speed
Public Blockchain Disadvantages
- Heavy energy usage
- Lack of total privacy or anonymity
- Can be subject to malicious attacks
Private Blockchain
A private blockchain, like the name suggests, is private. It only allows select entry from invited participants. Joining is only possible through a verified and authentic invitation. Validation by a network operator or an automated set of instructions is essential.
Private Blockchain Benefits
- Security is higher in a private blockchain
- It is more reliable due to the regulation of the network and nodes.
Private Blockchain Disadvantages
- Control can be an issue. Customers using private blockchain are reliant on the network owners and developers.
- Manipulation of transactions and block users can happen.
- Slow growth due to no public nodes, the more nodes there are, the bigger the network, and the faster it grows.
Public or Private?
The difference between private and public blockchains comes down to who controls it. Who decides the mining rights and rewards. Who maintains and shares the ledger and the permissions each person has.
A public blockchain is focused on true decentralization, as everyone has control. Private blockchain, on the other hand, strays away from that concept, as there is a control element with members.
The increased adoption of bitcoin is thanks to the public blockchain accessibility. Yet, a private blockchain is more secure and has a broader appeal to businesses.
What Are The Nodes?
In blockchain terms, a node is a device, usually a computer or laptop. These nodes form the infrastructure of the blockchain. Each of the nodes on a blockchain connects. They are also in constant communication, exchanging data, so they remain up to date.
It’s estimated that there are 10,000 full operational nodes on the bitcoin network. These full nodes then propagate the blockchain to other nodes within the network.
What is Mining?
Bitcoin mining involves using some serious high-powered computers to solve complex computational maths problems, which is where large energy consumption occurs.
The chance of a computer solving these problems is roughly 1 in 13 trillion.
Bottom Line
The difference between private and public blockchain comes down to who controls it, and how you can join the blockchain.
Want to take advantage of your blockchain? Open up an online bank account, deposit your cryptocurrency, and start using your BlockCard as soon as your application is complete.
