Types of Blockchain Explained
Type
Currently, there are at least four types of blockchain networks–public blockchains, private blockchains, consortium blockchains, and hybrid blockchains.
Public blockchain
A public blockchain has absolutely no access restrictions. Anyone with an internet connection can send transactions to it, as well as become a validity (i.e., take part in the consensus's execution protocol). Typically, such networks provide an economic incentive for those who secure and use them. Some kind of proof of stake or proof of work algorithm.
Some of the largest, most well-known public blockchains are the bitcoin blockchain and the Ethereum blockchain.
Private blockchain
A private blockchain is allowed. No one can join unless invited by the network administrators. Participant and validator access is prohibited. To differentiate between open blockchains and other peer-to-peer decentralized database applications that are not open ad hoc computer clusters, the term distributed ledger (DLT) is commonly used for private blockchains.
Hybrid blockchain
Hybrid blockchains have a combination of centralized and decentralized features. Centralization The exact functioning of the chain may vary depending on which part of the decentralization is used.
Side chain
A side chain is a designation for a blockchain ledger that runs parallel to a primary blockchain. Entries from the primary blockchain (where said entries typically represent digital assets) can be linked to and from the side-chain. This allows side-chains to operate independently of the primary blockchain (e.g., using alternative means of record keeping, alternative consensus algorithms, etc.)
Interoperability
With the increasing number of blockchain systems, even those that only support cryptocurrencies, blockchain interoperability is becoming a topic of prime importance. Its purpose is to help transfer assets from one blockchain system to another. Wegner stated that "interoperability is the ability of two or more software components to collaborate despite differences in language, interface, and execution platform". Blockchain interoperability therefore aims to support this kind of collaboration between blockchain systems, regardless of those kinds of differences.
There are already several blockchain interoperability solutions available. They can be classified into three categories: cryptocurrency interoperability approaches, blockchain engines, and blockchain connectors.
The IETF recently had a Blockchain Working Group that has already drafted a Blockchain Interoperability Architecture.
High energy consumption
Blockchain mining peer-to-peer computer computations by which transactions are validated and verified–requires significant amounts of energy. The Bank for International Settlements criticized public proof-of-work blockchains for high energy consumption. In a 2021 study conducted at Cambridge University, researchers determined that bitcoin (at 121.36 terawatt-hours per year) uses more electricity annually than Argentina (at 121 TWh) and the Netherlands (at 108.8 TWh). According to Digiconomist, one bitcoin transaction requires approximately 707.6 kilowatt-hours of electrical energy, the amount of energy consumed by the average American household in 24 days.
US Treasury Secretary Janet Yellen called bitcoin
an extremely inefficient way of transacting, adding that the amount of energy consumed in processing those transactions is staggering. Bitcoin uses more electricity per transaction than any other method known to humanity.
Bill Gates said.
It's not a great climate thing.
Nicholas Weaver of the International Institute of Computer Science at the University of California, Berkeley, examined the online security of blockchain, and the energy efficiency of a proof-of-work public blockchain, and found 31–45 TWh of electricity completely insufficient in both cases. Used for bitcoin in 2018 produced 17–22.9 MtCO2.
Within the cryptocurrency industry, concerns about high energy consumption have prompted some companies to consider moving from a proof-of-work blockchain model to a less energy-intensive proof-of-stake model.
In October 2014, the MIT Bitcoin Club, with funding from MIT alumni, gave graduate students at the Massachusetts Institute of Technology access to $100 worth of bitcoin. According to the study by Catalini and Tucker (2016), adoption rates have shown that people reject the technology when they provide delayed access to those who adopt ancient technologies.
Adoption decision
The motivation for adopting blockchain technology (one aspect of innovation adoption) has been examined by researchers. Jensen et al. Provided a framework for analysis. Koens and Poll pointed out that adoption can be driven heavily by non-technical factors. Based on the behavioral model, Lid discusses the difference between adoption at the individual level and at the organizational level.