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Blockchain Types Explained

Nov 14, 2022
8 min read

This blog post will cover:

  • Permissioned and permissionless
  • Main types of blockchains
  • Pros and cons of blockchain technology 
  • Conclusion

No doubt that blockchain technology got more popular through time. The idea to make a chain of crypto insured blocks belongs to Stuart Haber and W. Scott Stornetta, the research scientists. In 1991, they initially needed to think of a method to store their digital docs, and this task led them to an idea of a blockchain. 

The story of birth is clear, but have you ever wondered what forms of blockchain exist? Let’s touch upon this topic today. 

Permissioned and permissionless

Since we’re done with the definition, let’s move on. All kinds of blockchains are categorized as permissionless, permissioned, or both. 

Permissionless ones are called trustless as well. They are accessible for everybody to join the blockchain that’s confirming transactions. Permissionless types are often utilized when transparency is needed. They appear to be more secure because of the big quantity of nodes. However, this also is a minus because the transaction processing speed is quite low. Weak energy efficiency caused by a massive network is also a problem when it comes to trustless blockchains. 

Permissioned kind limits entry into the network for particular nodes and restricts their rights, too. Users of one blockchain can find out each other's IDs. This form of blockchain is utilized when the maximum privacy and safety is needed. Also, permissioned ones are assumed to be much more efficient — with their limited access, there are fewer nodes. It’s leading to a higher transaction processing pace. However, this blockchain can’t be considered as absolutely decentralized as it needs a permission. 

Main types of blockchains

There are 4 major kinds — public, private, hybrid and consortium. Further we’ll talk about each type and share their features for a better understanding.  

Public Blockchain

These are the most decentralized ones. Everybody who owns a PC and is connected to the Internet is able to enter the network. This blockchain doesn’t belong to anyone and individuals can verify the transactions. Talking about disadvantages — the processing of transactions is quite slow because of the large blockchain size. High energy consumption due to PoW is also a soft spot here. 

At the very moment, public blockchains are mostly picked up for mining and swapping crypto. You probably know about Bitcoin (BTC), Ethereum (ETH) and Litecoin (LTC), which represent this type of blockchains.  

Private Blockchain

They aren’t very decentralized. Solely specific nodes may join the process. Private blockchain is also run in a locked network which only the approved people can join. The speed of transaction processing is fast due to the small blockchain size. The scalability is adjustable. The size of the network might be edited manually. What about cons? These blockchains are vulnerable to malicious actions because the node amount is predefined. 

With a proper security level, such blockchain is excellent for protecting the data with no need to reveal it to the public. Some firms choose this type for audits, voting and asset management. Hyperledger and Corda are perfect illustrations of private blockchain usage.  

Hybrid Blockchain

It’s a mixture of private and public blockchain with one part governed by the individual organization and the other one is available to the public. It’s difficult to hack such a blockchain as more than a half of users can’t reach the network. The price of transactions is quite low because only a couple of nodes have to verify it. The minuses of a hybrid are: the lack of transparency and efficiency problems — not everybody is able to implement the hybrid. 

Hybrid blockchain delivers a great remedy for the healthcare, government, real estate and finance sectors. For now, Ripple and XRP represent a hybrid approach. 

Consortium Blockchain

Consortium blockchains are permissioned and are usually administered by a group of organizations. The safety of consortiums is strong thanks to decentralization. What else is remarkable: speeded up transactions, privacy and flexibility — the decisions are made faster. Nonetheless, you can forget about the transparency with the consortium blockchains. They’re also very vulnerable in case some nodes get endangered. 

Consortiums fit businesses and the banking sphere perfectly. You don’t have to think a lot before examples of such chains come to your mind — Tendermint and Multichain (MULTI)!

Pros and cons of blockchain technology 

We can’t talk about the blockchain types without discussing their benefits and drawbacks. As you probably know, the central mission of blockchain is to perform and encrypt transactions inside the secured network. Thanks to these chains, users are able to monitor payments from one end to another. Let’s highlight a few significant advantages of blockchains:

  1. Better trust. The important point is transparency — users are able to check what’s going on in the network and reassure their coins will reach the recipient. 
  2. Stronger data security. Thanks to the enhanced security arrangement, all the deals conducted via the blockchain are safe and sound. 
  3. Decreased price of production. Blockchains aim to lower the transaction fees as more enthusiasts are joining the Crypto World so that they could see the traditional fiat transactions are more costly to complete.  
  4. High speed. The rapidity of deals performed through blockchain usually exceeds the ordinary transactions made with banks. 
  5. Unchangeable recordings. Customers aren’t able to modify the transaction records, and this adds 1 more point to the security section.
  6. Smart contracts usage. They’re meant to automate the agreement performance, so members are instantly sure about the result, without any middlemen or waste of time. Visit this article for more info on smart contracts.

Of course, we should note some disadvantages, too:

  1. Data change is impossible.
  2. A vast database needs massive storage.
  3. In case if the private key is lost, the owner won’t be able to access his funds. 

Blockchain technology isn’t perfect, but this doesn’t mean that it never will be. Hundreds of cryptographic scientists and developers are working daily to improve blockchain and eliminate the vulnerabilities. 


As you can see, there are not so many types of blockchains. Each kind has its pros and cons which makes it easier to choose from if you’re planning to launch your own project — some require more privacy and some aim to be perfectly transparent, it depends on the individual goals. 

Blockchain and crypto technologies may seem difficult and strange at once, but if you spend enough time researching, it might result in you being a professional someday. This is why SimpleSwap Blog is providing its users with detailed information on every sphere’s topic. Stay tuned for more and let’s make it to the moon! 

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