Different Types of Blockchain With Example & Why We Need Them (Free PDF)

Different Types of Blockchain & Why We Need Them

Bitcoin was the first to introduce blockchain technology to the world.

We know that Satoshi Nakamoto mined the first bitcoin in 2009. And they started it with a vision to make an alternate Peer-to-peer currency.

But in today’s world, entrepreneurs and business owners see this technology as an opportunity. And they use this technology in different industries.

According to Gartner’s 2019 CIO survey, approx 60% of CIOs expect to deploy blockchain by 2022, but only 5% saw it as a game-changer. 

But now we can see better and updated coins like Litecoin, Dash, Ethereum, etc than bitcoin, Which are now called altcoins.

Note: Before reading this reading let’s understand Blockchain technology and how does its works.

Different Types of Blockchain

There are two complicated types of blockchain that are Permissionless and Permissioned Blockchains.

different types of blockchain network

Let’s take a quick comparison between both Blockchains

Permissionless Blockchain Permissioned Blockchain
  • This blockchain network allows anyone to become a node of the network without any restriction. 
  • Permissionless Blockchain networks are more secure and transparent.
  • These networks take more time in the transaction because a high number of users are joined this network.  
  • This blockchain network is decentralized and highly secure due to the large number of nodes available in this network. 

More nodes = More secure

  • Conversely, a Permissioned blockchain restricts access to a network to certain nodes and may also restrict the rights of those nodes on that network.
  • These networks are less secure.
  • There are fewer nodes on the blockchain, resulting in less processing time per transaction. 
  • It consists of a limited number of nodes that can be easily hacked. And it can be controlled by an organization or government.


Both have 4 main types of blockchain networks that have been created by entrepreneurs after bitcoin.

  1. Public Blockchains, 
  2. Private Blockchains 
  3. Hybrid Blockchain
  4. Consortium or Federated Blockchains

Each and every blockchain Network has its own advantages, drawbacks, and ideal uses.

1. Public Blockchains:

We can understand a public blockchain by its name that is open to the public. Anyone can join this network without any restriction or permission.

Also, public blockchain networks are highly secure, open, and transparent for anyone. This network is based on the Decentralization system. 

But here a question that comes to our mind is when no one is controlling this then how decisions are taken on every transaction. So the answer to this question is that every transaction is automatically verified by the consensus mechanisms such as proof of work and proof of stake. 

Read More about PoW and PoS

Let’s understand the advantages and disadvantages of Public Blockchain networks

Advantages Disadvantages
  • These are completely independent 
  • Highly secured by the decentralized consensus mechanism system
  • It will be able to run as long as computers are connected to it.
  • It is fully transparent
  • The network can be slow
  • No one can control it
  • It can be Hacked if hackers gain 51% or more of the computing power
  • Harmful for the environment


Example:- Bitcoin, Litecoin, etc.

Bitcoin and Litecoin are purely public blockchain networks because in this anyone can do the above-mentioned things.

—>Anyone can run BTC/LTC full node and start mining.

—>Anyone can make transactions on BTC/LTC chain.

—>Anyone can review/audit the blockchain in a Blockchain explorer.

2. Private Blockchain Network:

The private blockchain is private property that can be controlled by an individual, organization, or government.

If you want to join this blockchain network then you need the permission of an in-charge. No one can do mining here without the consent of the central in-charge.

Advantages Disadvantages
  • They can be controlled by the organization
  • The transaction is fast because of the limited number of nodes
  • you can prevent third parties from accessing sensitive information.
  • Organizations have full control over activity
  • It is less secure because of the limited number of nodes


But it is still debatable whether such a private thing can be called a ‘blockchain’ because it is against the whole purpose of the bitcoin blockchain.

For Example:- Bankchain, etc

  • Anyone can’t run a full node and start mining.
  • Anyone can’t make transactions on the chain.
  • Anyone can’t review/audit the blockchain in a Blockchain explorer.

3. Hybrid Blockchain

Hybrid Blockchain Network is a type of blockchain technology that’s a mix of both private and public blockchain networks. 

In this, anyone can join this network without any permission of the organization. But organizations can control who can access this specific data stored in the blockchain and what data will be opened up publicly.

Transactions and records are not made public but they can be verified when needed, with the help of smart contracts.

Advantages Disadvantages
  • it creates a closed ecosystem
  • Transactions are cheap and fast
  • better scalability than a public blockchain
  • This is not fully transparent
  • Organizations can change its settings
  • There is no incentive for users to participate or contribute


For Example- Blockchain-Based real estate or hospital

  • Businesses can create a private system that shows certain information to the public: such as listings, services, etc.
  • The hospital can store the medical records of their patients.
  • Users can access this information through a smart contract.
  • The government also uses this to secure their citizen’s information.

4. Consortium or Federated Blockchain:

The consortium blockchain is also a combination of both public and private blockchain network features.

This network basically has a group of companies or representative individuals that come together to make the best decision for the whole network. Such groups are called consortiums or a federation.

For example: Let’s suppose you join a blockchain consortium of the top 20 financial institutions in the world. In which they have decided in the code that if any transaction or block or decision to add to the blockchain, will be voted/verified by more than 15 institutions.

Advantages Disadvantages
  • Highly secure & Fast than Public network
  • Scalable & more efficient than a public network
  • It is also controlled by the company
  • Less Transparent than a public network



Example: r3, EWF, etc

  • Mostly Banking and payment two types of the use case of it
  • Research institutions can also use this network

Why We Need These Blockchain networks

Public Network

Private Blockchain Hybrid Blockchain

Federated Blockchain

  • Open for Public
  • Anyone can do transactions
  • Highly secured from hackers
  • Transparent for everyone

Ex. Bitcoin, Litecoin, etc.

+ Anyone can’t access it

+ Anyone can’t make transactions

+ Less secure and data is not transparent

Ex, Bankchain

+ it creates closed ecosystem

+ Transactions are cheap and fast

+ better scalability 

+ Highly secure & Fast 

+ Scalable & more efficient

+ Controlled by organization

Ex. r3, EWF, etc


At the present time, 4 types of blockchain networks are available. But here a question comes to mind why do we need them.

So, let’s find the answer

Every blockchain network is very important to us because every network solves some problem or the other.

Industries required different types of blockchain for solving different types of problems such as:-

  • No one needs to rely upon huge servers
  • Blockchain is faster and more affordable 
  • They help to eliminate the third party person
  • No need for more trusted parties because you can implement smart contracts instead of them
  • These are transparent
  • Reduces redundant work

If we want more privacy then we can go with a private or consortium or hybrid network. 

Because of that reason industries are looking for more use cases of blockchain technology. So, they can use it.



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