How Many Blockchains Are There?

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1. Public Blockchain Networks

Most crypto protocols like Bitcoin and EOS blockchain fall into this category. These projects are open-source, meaning anyone can easily build on them and monitor transactions on the network through their blockchain explorer.

Blockchain networks like Bitcoin use the proof-of-work (PoW) consensus algorithm.

The PoW algorithm requires validators to compete in solving complex mathematical puzzles, which ensures greater security at the expense of speed, energy efficiency, and cost. This feature has seen the Bitcoin network constantly criticised for its energy-guzzling validation process.

While this has remained a key issue for the Bitcoin network, several public blockchain networks have already migrated to a more energy-efficient and low-cost consensus model called the proof-of-stake (PoS). Under the PoS model, holders of a cryptocurrency can stake their coins and create validator nodes to validate transactions on the network.

2. Private Blockchain Network

As the name suggests, a private blockchain network permits only a few select participants. Participants can only join such networks through authentic and verified invitations.

So, a private blockchain controls who can participate in the network, execute consensus protocols and maintain the shared ledger. The owners of these blockchains have the right to edit, override, and delete any entries on the blockchain as they see fit. Hyperledger is a great example of a private blockchain network.

Considering how they function, private blockchains have been criticised for not being so decentralised. They are closed, secure databases that grant access to only a few participants to run nodes, make transactions, or authenticate settings.

3. Permissioned Blockchain Network

A permissioned blockchain operates as a mix between the private and public blockchain networks. These blockchains support several customisation opinions, including allowing anyone to join the network after their identities have been sufficiently verified.

The entire point of a permissioned blockchain is to grant special permissions to each participant. This way, they can perform specific functions and handle specific processes. By restricting specific functions, permissioned blockchains can be open to more people.