What is a Private Blockchain? All you need to know.

what is a private blockchain? difference between public and private blockchain

In this article, we will discuss what is a private blockchain. How it works, personal blockchain pros and cons, and features.

When we hear blockchain technology, we think it’s decentralized, but we may need to become more familiar with the term private blockchain. Let’s dive a little deeper into it.

What is blockchain technology? Where can it be used?

Blockchain technology. which It is a decentralized, distributed ledger system that enables the recording and verification of digital transactions without a central authority. It uses a network of computers to maintain a continuously growing list of records, called blocks, linked and secured using cryptography.

Each block contains a timestamp, and a link to the previous block, creating an unchangeable chain of the transaction history. This technology is the backbone of many digital currencies, such as Bitcoin and Ethereum. It is also being explored for other potential use cases, such as supply chain management and voting systems.

Use of blockchain technology:

Blockchain technology has a wide range of potential uses beyond digital currencies. One of the most exciting areas of application is supply chain management.

By utilizing a decentralized ledger system, companies can create a transparent, tamper-proof record of all transactions within their supply chain. This can improve efficiency and reduce costs by removing intermediaries and streamlining processes.

Additionally, blockchain technology can be used for digital voting systems, providing a secure, transparent way to conduct elections without the risk of voter fraud. Other potential uses include digital identity management, brilliant contract execution, and record keeping.

As the world becomes increasingly digitized, the adoption of blockchain technology is expected to continue to grow and revolutionize various industries.

What is a private blockchain?

Access to a private blockchain requires authorization from the user. They operate via rules and permissions that limit network involvement. 

Only the parties involved in a transaction will be aware of it, and no other parties or stakeholders will have access. The Hyperledger Fabric is a well-known instance of a private blockchain.

The access mechanism may differ; current participants may choose new members, a regulatory body may provide participation licenses, or an organization may decide on future actions.

What Is the Difference Between a Public and a Private Blockchain

Public Blockchain:

A public blockchain is a blockchain network where any participant can freely join and participate in the basic activities of that blockchain network. You can write and read the ongoing activities on a public blockchain network.

The public blockchain network is decentralized, as a single entity does not control it. After they have been validated on the blockchain, data on a public blockchain cannot be modified or altered.

Private blockchain:

Participants can only join a private blockchain network after being invited and having their identity or other needed information authenticated and validated. 

The network operator(s) or a clearly defined set of protocols performed by the network via smart contracts or other automatic approval mechanisms perform the validation.

Pros of Private blockchain

  • The blockchain can only be used by people who have been invited – this is known as a mission blockchain.
  • Each node receives a copy of the entire blockchain.
  • The owner of a blockchain can reverse or delete transactions at any time.
  • There is no restriction on when blockchain technology rules are to be changed.
  • In addition to changing the ledger itself, the owner can modify it.

Cons of Private blockchain

  • Blockchains are permissionless – anyone can use them.
  • Each node receives a copy of the whole blockchain.
  • Once put into the blockchain, data becomes immutable and cannot be modified.
  • The Bitcoin white Paper stated the rules for how the blockchain operates, which have not changed.
  • Data can’t be modified.


A private blockchain is designed for a corporate or other entity to run among itself and facilitates transactions only approved by the entity.

The private nature of private blockchains means there is no incentive to attack the network. Suppose it were to be attacked even then. In that case, mechanisms are in place, such as nodes, multi-sig addresses, etc., to prevent any transaction without, say, 50% of the entities approving the said transaction. 

Private blockchains can be ideal for use cases such as supply chain management, where some can not share specific information with competitors.

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