Permissioned Vs Permissionless Blockchain
Blockchain is the latest in a long line of tech that’s everywhere; businesses are increasingly jumping on the blockchain bandwagon for various reasons. The hard part is identifying valid use cases for your business to adopt. Once you’ve done this, the next question is about the tech itself.
A common question these days when picking blockchain tech is whether to use permissioned or open blockchain. In other words, should your blockchain demand proof of identity from participants and control smart contracts?
Here are a list of attributes typical to a permissioned blockchain ecosystem. This should help you figure out if permissioned is right for you.
1. No real full nodes
In a permissioned system, the “Every full node that performs all of the required complete computation” arrangement is done away with. When you look at the Hyperledger Fabric, there are dedicated nodes for transaction ordering, validation and commitment separately. This ensures much higher performance when compared to open blockchains.
2. Scalable consensus
In a permissioned system, we can completely get rid of computational algorithms such as Proof of Work and replace it with voting-based ones like Proof of Stake or with Byzantine Fault-Tolerance, which helps a lot in achieving scalability in validated blocks being appended to the chain.
3. Privacy & Control
When enterprises need transparent governance within their consortium, permissioned blockchain provides it implicitly. Though blockchains are distributed and immutable, there are several scenrios where businesses need to control who can participate within the distributed system and contribute to the immutability.
Here is an interesting post explaining how the evolution of permissioned blockchain can compete with and devalue Ripple:
As we immerse ourselves deeper in the permissioned ecosystem, we’ll continue to pot our findings here. Stay tuned!