Blockchain has aced the digital transformation game and taken everything up by a notch. Digital transactions and data storage have been made more secure using blockchain technology but these systems are not all the same since they are built on different types of blockchains. Both the users and experts need to understand these differences to make the right choice while selecting the right kind of blockchain.
This blog delves into how security varies among different blockchain types.
Public Blockchains
Traditional blockchains include public blockchains such as Bitcoin and Ethereum in which the consensus process is open for anyone to join. Security in public blockchains is maintained through consensus mechanisms including proof of work or proof of stake. Both of these mechanisms demand massive computation power or capital, thus, rendering an attack on it economically ineffective.
But it should also be noted that public blockchains are still not immune to certain weaknesses. These networks are prone to different sorts of attacks such as 51% attacks where one entity controls more than half of the network’s hashing power. Even though frequent, such attacks can pose a threat to the stability and security of the network. Also, the openness of public blockchains, which is helpful for auditability purposes, can present problems due to data privacy.
Private Blockchains
Private blockchain networks are those that allow only a limited number of people to join the network. When it comes to participation and validation, organizations prefer more control over who can engage in private blockchains. Security for public blockchains is usually accomplished by permissions, which reduces the problem of attacks but brings new issues.
As pointed out before, private blockchains are inherently centralized, which translates to fewer nodes, and this has both pros and cons. On the one part, having fewer nodes makes security easier to manage and there’s less surface area for an attacker to target. On the other hand, if the central authority is compromised, then there might be a risk of having a single-point failure. Hence, the dangers within private blockchains have to be managed through strong internal security control and audit mechanisms.
Consortium Blockchains
Consortium blockchains are intermediate between public and private ones, meaning that some characteristics are similar to both of them. They are usually managed by a group of organizations where each has an interest in the network. Thus, security in consortium blockchains is due to decentralized governance and at the same time controlled access.
These blockchains have a permissioned setup of validation where only participants with permission can participate in the validation process, thus, reducing the chances of intruders and enhancing the efficiency of the process. Nonetheless, there is internal conflict within consortium blockchains which must be dealt with and governance structure must be strong and not easily manipulated by the entities in the consortium.
Conclusion
The level of security of a blockchain system depends mainly on the type of the system and the type of consensus algorithms. Centralization of public blockchains provides excellent security features but is highly vulnerable to attack and data. Private blockchains offer confined security but have to deal with the problem of centralization at the same time. Consortium blockchains bear a blend of the described models but are sensitive to governance whenever they run safely.
