What is Private Blockchain and how it is different from Public Blockchain?

As of recently, there has been quite a lot of buzz regarding Blockchain technology and its types which can make many confused about what is Public blockchain or Private blockchain. Questions are many but answers are few and, in this article, we will cover how blockchain works and what is Private and Public blockchain, how both are different and why Private Blockchain development is preferred by enterprises. 

How does Blockchain work?

Blockchain can be regarded as a chain of blocks, which can be regarded as a page in the ledger system. A block as a part of a chain consists of a timestamp, data, and a hash of the block that links it to the previous block, thereby maintaining chronology. The Hash of a block contains vital information and acts as the unique identification of its contents, apart from serving as a connecting link with other blocks over the network. 

These Blocks are distributed across the machines, which are called nodes on the network and every node has a copy of itself over another machine. So, in case of any eventuality also data always remains accessible over the network at any point in time. Under any circumstances, Blockchain does not lets altering any block, and if attempted it makes all the blocks invalid and void. 

What is a Public Blockchain?

A Public Blockchain system is a blockchain network that allows anyone to join whenever they want without any restrictions. These blockchain networks are called “Permissionless Blockchain” due to no restrictions and decentralization is the main theme of public blockchains. There is no central authority having any control over the network, and the data in the network is secure, as it can’t be changed once validated on the Blockchain. 

Public Blockchain networks usually follow an incentive system to attract more people to join them and users are rewarded to join them. Public Blockchain networks face a major drawback in terms of functioning, that is the need for a vast amount of power to process the transaction in the distributed ledger, which runs at a wider scale. Each Node in the network solves sophisticated, resource-intensive cryptographic challenges to achieve consensus, which differs from platform to platform but it ensures that all the participants have equal rights. 

What is a Private Blockchain?

A Private Blockchain system network is a specially conditioned and customized Blockchain network that allows only selected users are allowed to participate. Here a single organization has authority over the network, regarding the rules of what a particular participant is entitled to do and what not. Due to numerous restrictions present, these Blockchain networks are called “Permissioned Blockchain” as these private networks have different forms of authorization schemes to identify and provide or deny access to the users. 

Generally, an invitation is required to join a Private Blockchain network and the same must be authorized by the central authority or there are instances, where a certain set of rules needs to be followed by a user. Those rules are set by the network administrator, regarding certain limits like who can engage in certain transactions and who is restricted from doing specific transactions. 

Key differences between Public and Private Blockchain

Highly Efficient

Being efficient is one of the main concepts behind developing the Private Blockchain network, as public networks tend to eat up a large amount of power of the network to process the transactions and it leads to rapid slowing of the network. 

Private Blockchain networks are highly efficient, as they allow only a handful of authorized people into the network. 


Private Blockchains offer a high amount of privacy that blockchain technology that can offer, as enterprises need it to run their businesses. It is a known fact that any sort of leakage of sensitive information can result in massive drawbacks for businesses. 


Private Blockchains are quite stable compared to public ones and this is one of the reasons why enterprises are preferring them. 

Another concern is the high gas fees in the Public Blockchains, in a Private blockchain network the transaction fee remains the same due to the fact that there are only a handful of people who can request transactions. 

Empowers Enterprises

A Private blockchain network lets only the company have the power to impose a certain policy or revoke it, and these networks are highly capable of backing up the companies and offering them great security.  

Conclusion – Which one to choose?

A corporate business model would certainly require transparency to the full extent, and anonymity is frowned upon, but sharing a piece of extra information with someone who is a supply vendor is a strict no-no. A Private Permissioned Blockchain would let share high-level macro data with consumers regarding where the origin of the product is and how safely it is processed but at the same time can hide the financial aspects. 

Public Blockchain must be preferred wherever there is a need to treat all users the same, as in the instance of cryptos almost the majority of cryptocurrencies are based on Public Blockchain. But if you are an entrepreneur running a business that requires running a network with some restrictions then Private Blockchain development is perfectly suited for you. The Blockchain experts at Rejolut have observed that currently, enterprises need a robust mechanism that would empower the organization which Private Blockchain can do, whereas Public Blockchains focus on empowering an individual is good for other use cases. 

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