Public and Private Blockchan - Spaziocrypto
By Ziken Labs profile image Ziken Labs
7 min read

Public and Private Blockchan: How Do They Work?

The blockchain is an emerging technology that is rapidly revolutionising the way we interact with the digital world. It is a distributed ledger of immutable data, which can be used to record a wide range of information, and is composed of blocks of data, which are added to the chain

The blockchain is an emerging technology that is rapidly revolutionising the way we interact with the digital world. It is a distributed ledger of immutable data, which can be used to record a wide range of information, and is composed of blocks of data, which are added to the chain in chronological order. Each block contains a range of information, including:

  • The data to be recorded
  • A digital signature verifying the authenticity of the data
  • A timestamp indicating the date and time the data was added to the chain

There are two main types of blockchain: Public and private.

Public Blockchain: Transparency and Decentralisation

The public blockchain is the beating heart of decentralisation, a feature that has redefined the way we conceive and manage digital transactions. In this chapter, we will explore the foundations of public blockchains, understanding how they work and unveiling the distinctive advantages they offer through transparency and decentralisation.

The Base: Structure and Consensus

Public blockchains are characterised by their open and universally accessible structure. Every participating node in the network has a full copy of the ledger, ensuring that every transaction is verifiable by anyone at any time. This approach eliminates the need for central intermediaries, such as banks, as the validity of transactions is entrusted to the distributed network. Consensus is achieved through consensus algorithms, such as the Proof of Work or Proof of Stake. These algorithms ensure that all transactions are validated fairly and securely, maintaining network security.

Transparency and Immutability

A key aspect of public blockchains is transparency. Every transaction is visible to all network users and can be tracked from the moment of its creation. This visibility eliminates the risk of fraud and manipulation, helping to build intrinsic trust in the system. Furthermore, the immutable nature of the blockchain ensures that once registered, a transaction cannot be altered. This level of security is crucial for industries that require accurate registration without the possibility of retroactive changes.

Decentralisation and Resistance

Decentralisation is the pillar on which public blockchains are based. The lack of a central authority prevents monopolistic control and increases the system's resistance to breaches. Even in the case of targeted attacks, the network remains resilient due to its global distribution. The active participation of numerous nodes ensures that the network is truly decentralised, ensuring that decisions are made democratically and that no single actor can exert undue influence.

Public Blockchain Advantages

  1. Reliability: The decentralised and distributed nature of the public blockchain makes it highly reliable.
  2. Inclusivity: Accessible to anyone with an Internet connection, it promotes inclusivity and global accessibility.
  3. Censorship Resistance: Decentralisation makes censorship difficult, contributing to freedom of expression and resistance against oppression.

Private Blockchains: Control and Privacy

While public blockchains are an open book, private blockchains represent a confidential chapter, where control and privacy are prioritised. We will examine how they offer a controlled and secure environment, particularly suitable for certain business contexts.

Closed Structure and Selective Participation

Unlike public blockchains, private ones operate on a closed and controlled structure. Access is restricted and selected, ensuring that only authorised entities can participate in the network. This approach is ideal for companies and organisations that wish to maintain exclusive control over their blockchain infrastructure.


In private blockchains, consensus rules can be tailored to the organisation's specific needs. This allows for greater flexibility and customisation, enabling organisations to manage network efficiency according to their unique requirements. The ability to easily modify consent rules is a key element in adapting to changing business needs.

Data Privacy and Selective Sharing

The private blockchain is distinguished by its emphasis on data privacy. Authorised actors only have access to information relevant to their role, thus protecting sensitive data. This is crucial for sectors where confidentiality is a priority, such as in finance and healthcare. Selective information sharing allows companies to maintain control over what data is shared with counterparts, while preserving the security and confidentiality of sensitive information.

Flexibility and Scalability

Private blockchains offer greater flexibility and scalability than public counterparts. Companies can adapt the structure of the blockchain to meet the specific needs of their industry without having to deal with the restrictions imposed by a public network.

Private Blockchain Advantages

  1. Absolute Control: Companies retain complete control over the network and its rules.
  2. High Efficiency: Customisation of consensus rules and closed structure allow for high operational efficiency.
  3. Privacy and Security: Selective data management ensures a high level of privacy and security.

The world of private blockchain is characterised by a more centralised governance, but this approach is often essential in corporate contexts. In the next chapter, we will compare the features of public and private blockchains to help you navigate the choice best suited to your specific needs.

Comparison of Public and Private Blockchains

With the basics of public and private blockchains now clear, it's time to compare them to fully understand the differences that might influence your choice. We will look at the strengths and limitations of both variants, helping you navigate the vast landscape of blockchain technologies.

Security and Decentralisation: Public vs. Private

Public blockchains, due to their decentralised nature, offer robust security based on widespread participation and resistance to attacks. On the other hand, private blockchains, while allowing for more centralised control, mitigate some security concerns due to their closed structure and access control mechanisms.

Privacy and Transparency: Two Faces of the Same Medal

While public blockchains are synonymous with transparency, private blockchains place an emphasis on privacy. It is a choice between total visibility and complete control over data. However, it is important to note that some hybrid blockchains try to balance both aspects, allowing public transactions and restricted areas.

Sectoral Applications: Public vs. Private

Public blockchains are often associated with cryptocurrencies and open source projects, while private blockchains find application in sectors such as finance, healthcare and supply chain management. The choice between the two variants largely depends on the specific needs of the sector and the willingness to share or keep information confidential.

Scalability and Speed of Transactions

Public blockchains, due to their decentralised nature and widespread participation, can be slower and less scalable than their private counterparts. The latter, with closed structures and customisable consensus rules, are more flexible and can achieve higher transaction speeds in certain contexts.

Cost and Sustainability

Public blockchains can incur higher transaction costs, especially when using more expensive consensus algorithms such as Proof of Work. Private blockchains, on the other hand, may offer more efficient cost management and may be more sustainable in terms of energy consumption.

Practical Applications and Sectors-Involved

Now that we have explored the characteristics of public and private blockchains, it is crucial to understand how these technologies translate into practical applications of blockchain. We will examine several areas where blockchains are gaining traction, highlighting the specific applications and benefits brought by public and private variants.

Finance and Cryptocurrencies: Public-in-the-headlines

Public blockchains have revolutionised the financial sector with the introduction of cryptocurrencies such as Bitcoin and Ethereum. The decentralisation and transparency of public blockchains offer an innovative solution for financial transactions, reducing dependence on traditional intermediaries.

Healthcare: Privacy of Information with Private Blockchains

In the healthcare sector, privacy of information is crucial. Private blockchains are adopted to ensure secure and confidential management of patients' health information. This enables selective sharing of information between authorised healthcare professionals, improving efficiency and protecting data sensitivity.

Supply Chain Management: Public and Private in Synergy

Supply Chain Management benefits from both public and private blockchains. Public blockchains can provide transparency along the entire chain, enabling reliable traceability. On the other hand, private blockchains facilitate the internal management of corporate information, improving coordination between the various actors in the chain.

The smart-contracts, blockchain-executable codes that automatically execute and manage contractual agreements, are often associated with public blockchains, as transparency and decentralisation foster a trust environment. However, private blockchains are also used in legal settings for more confidential contracts.

Education and Certifications: Security with Private Blockchain

In the education sector, private blockchains are gaining ground in the management of certifications and qualifications. They ensure the integrity and security of information, reducing the risk of academic fraud.

Future Perspectives and Conclusions

In the face of current applications of public and private blockchains, it is intriguing to explore how these technologies will evolve and influence our world in the coming years. We will take a look at the future of blockchain, analysing emerging trends and providing concluding considerations on the path this revolutionary technology might take.

Interoperability Between Blockchain: A Connected Future

A key perspective is interoperability between different blockchains. Currently, blockchains mainly operate separately, but the trend is to develop solutions that enable smooth communication between networks, creating a broader, interconnected ecosystem.

Integration of Emerging Technologies

Integration with emerging technologies, such as artificial intelligence and the Internet of Things, is set to play a key role in shaping the future of blockchain. The combined use of these technologies could lead to more complex and highly specialised solutions.

Developments in Security and Consensus

Continuous improvement in the security of blockchain is essential to ensure the trust of users and companies. New consensus algorithms and security mechanisms will be developed to address emerging challenges and ensure the robustness of blockchain networks.

Governance and Regulations: Clarity-to-Favour-adoption

Governance and regulations will be focal points in the future of blockchain. Regulatory clarity and effective guidelines will help mitigate uncertainties and encourage adoption on a wider scale, especially in financial institutions and highly regulated industries.

Environmental Sustainability: A Growing Concern

Environmental sustainability will become increasingly critical, especially considering the ecological impact of some public blockchains based on Proof of Work. New, more sustainable approaches, such as the adoption of less energy-intensive consensus algorithms, are expected to develop.

Final Reflections: The Bet on the Future of Blockchain

In conclusion, at Spaziocrypto, we are convinced that public and private blockchains represent a milestone in our technological evolution. While public ones offer transparency and decentralisation, private ones provide control and privacy. The future will see a deeper interplay between these variants, shaped by continuous innovation and response to the changing needs of the technology and business landscape. The bet on the future of blockchain is that of a more transparent, secure and efficient world. We are only at the beginning of this revolution and, with the growth of blockchain technologies, we can expect scenarios that we can only imagine today. The challenge is to embrace change, explore new possibilities and consciously adopt blockchain technologies for a more innovative and sustainable future.

By Ziken Labs profile image Ziken Labs
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