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Describing basic blockchain type features

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Each type of blockchain has specific strengths and weaknesses. Which one to use depends on the goals and target environment. You have to know why you need blockchain and what you expect to get from it before you can make an informed decision as to what type of blockchain would be best. The best solution for one organization may not be the best solution for another. Table 2-1 shows how blockchain types compare and why you might choose one over the other.

The primary differences between each type of blockchain are the consensus algorithm used and whether participants are known or anonymous. These two concepts are related. An unknown (and therefore completely untrusted) participant will require an environment with a more rigorous consensus algorithm. On the other hand, if you know the transaction participants, you can use a less rigorous consensus algorithm.

TABLE 2-1 Differences in Blockchain Types

Feature Public Private Hybrid
Permission Permissionless Permissioned (limited to organization members) Permissioned (limited to consortium members)
Consensus PoW, PoS, and so on Authorized participants Varies; can use any method
Performance Slow (due to consensus) Fast (relatively) Generally fast
Identity Virtually anonymous Validated identity Validated identity

Blockchain Data Analytics For Dummies

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