Blockchain Types Explained

Jan Rock
6 min readDec 23, 2022


1. Introduction

Nowadays, the term blockchain means to many people’s emotions around cryptocurrencies and their bearish price sentiment, scams and other controversial statements. However, we should not forget that the problem is not linked to the technology or use cases. It is related to people and their intention and plans. We must understand the logical interest of certain groups and individuals in a publicly available unregulated system with real money exposed to malicious activity. I am not saying that everything on a public blockchain is a scam, but the recent few weeks have shown that even initially good plans can quickly turn into something completely different [CAICTT-BI, 2018).

It is essential to repeat that blockchain technology delivers promises; for instance, in the supply chain industry, it celebrates colossal attention. Many companies put the Blockchain on their priority list for 2023.

Last several years, the development of decentralised networks has led to various directions for Blockchain technology. Similarly, in the past other technologies went through identical development cycles moving towards standards.

2. Blockchain Types

In this article, I would like to introduce the different types of Blockchains:

· Public Blockchain

· Private Blockchain

· Consortium/Federated Blockchain

· Hybrid Blockchain

Different blockchains arose from the need to adapt them to work in other industries. One of the main unique features of this technology is that it is adaptive and can be integrated into any industry to suit the particular model in which the industry operates. The reason is probably hidden behind the fact it could be explained as an immutable distributed database. A supply chain network’s needs differ from those of real estate. This requires the emergence of different types of Blockchains. The most crucial difference starts with public and private Blockchains, where Consortium/Federated and Hybrid varieties combine and extend the previous types — Figure 1.

Behind every research, protocol, or open-source project or component is a hope that the community will recognise a unique aspect and drive the influence across the sector [Lacity et al., 2019] and, at some point in time, will be recognised as a new standard. The critical difference between focusing on “hashed money” or “hashed data” in permissionless/public or permissioned/private mode.

I do not want to go back to history and repeat how it was with Nakamoto’s email. In general, the most famous blockchain public applications are Bitcoin and Ethereum.

Figure 1 — Types of Blockchain

There are many others, but without significant impact, uniqueness or adoption.
Both are a member of the public permissionless family. Any person or institution can join the network, create a wallet, receive and submit transactions or contribute with hardware as a participant, validator, miner or staker.

Public blockchains are heavily decentralised around the world, with thousands of nodes on main and test networks with governance and the verification of transactions linked to a consensus protocol. Proof of work (PoW) on Bitcoin and Proof of Stake (PoS) currently on Ethereum keep the network operational, consistent and secured [Scott, 2018].

The PoW performs complex mathematical calculations before recording transactions within the block — a highly energy-intensive task preventing anyone from quickly joining the network and establishing a majority to own the network. The PoS, on the other hand, does not require extensive computation, just staked network-specific currency tokens to perform as a transaction validator with an award to do that. Ethereum has also set a minimum level of stake set to 32 ETH for 1–2 years which is sometimes criticised that just rich are allowed to be richer and get the award (interest). The community of miners / stakers is crucial for the networks to keep them functional and stable. An obvious disadvantage of public networks is not being trusted. Verification of every transaction to keep consensus happy is slowing down the network, and the transactions per second indicator are relatively low; even the promises from PoS seems to target five or even six digits number.

Private permissioned blockchains are designed differently, actually precisely the opposite. Users cannot access the network without permission — a key. Networks are created to extend current applications and provide new capabilities, such as immutability for inserted data. “Hashed data” is the primary use case. There are exceptions where we can run tokens — “hashed money” as well. There is no requirement for PoW or PoS. The critical nodes for validation, endorsement, ordering etc., are usually defined by the architect. That means the consensus is less complicated — fewer nodes involved, and throughput is significantly higher. Extra high throughput is often achieved by combining on-chain (transaction is written to the digital ledger) with off-chain transactions (transactions are stored outside of Blockchain, and the state is updated when the application decides). It can reduce the number of written events.

The centralisation can be mentioned as a disadvantage, with less robust security compensation being deployed on-premises or cloud secured with enterprise-level security.

At least two parties manage consortium / Federated blockchains (individual/company). Based on a particular architecture, the behaviour of the consortium blockchain is a semi-decentralised network in which both public and private related features are inherent. This way, specific data are transparently shared with all participating members while others are restricted. Federated blockchain runs consensus protocol on selected nodes with special care from individual and sub-network maintainers. The advantages and disadvantages of such a network can be easily determined from previous types. Fewer verifications, security, and decentralisation trigger higher TPS (transaction per second) and more centralisation features and services. A typical example of consortium blockchains is based on Hyperledger Fabric or Corda.

Hybrid Blockchain is the last of mentioned categories. It also utilises a mix of private and public blockchain network features and merges them into one network. Some data can be public, some private, depending on the use case. This is only available because a single authority manages Hybrid Blockchain. That means that hybrid Blockchain is mostly centralised to provide architecture-specific features. There are also other benefits, such as easy upgrades and updates. An example of a hybrid blockchain can be Dragonchain.

3. Summary

Blockchain technology is still a relatively new term, and many companies focus their attention purely on research. Blockchain needs more practical use cases to see the interest of customers and relevant areas of expansion for research. Companies are starting to invest in private blockchains. However, there is no affordable integration help on the market right now. Financial services and supply chains seem to be early adopters. The market is waiting for standards to create the hype. Many companies which are focused on “hashed” money products will probably disappear or convert into new areas in a relatively short period. The reason is behind lost trust in the retail market and the complicated entrance for institutional money. The main shift will be toward private blockchains and CBDC (Central Bank Digital Currency). The regulatory technology market is expanding with huge expectations from changes which can revolutionise the hashed money market. Something has to come to replace or extend Bitcoin and Ether. It would be unacceptable for governments to legalise these cryptocurrencies without knowing who owns them before they become legal. I am interested in your opinions in the comment below. Thank you.

4. Bibliography and Web Sources

China Academy of Information and Communication Technology Trusted Blockchain Initiatives. (2018). Blockchain White Paper. Online: (Accessed: 15/11/2022)

Lacity, M., Steelman, Z. & Cronan, P. (2019). Blockchain Governance Models: Insights for Enterprises. The University of Arkansas, Sam M. Walton College of Business. Online: 15/11/2022)

Mulligan, C., Scott, J.Z., Warren, S., Rangaswami J.P. (2018) Blockchain Beyond the Hype — A Practical Framework for Business Leaders. World Economic Forum. Online: (Accessed: 15/11/2022)

5. Recommended Books

Proof of Stake: The Making of Ethereum and the Philosophy of Blockchains by Vitalik Buterin (Penguin, 2022)

Virtual Society: The Metaverse and the New Frontiers of Human Experience by Herman Narula (Penguin, 2022)

Crypto Art — Begins by NFT Magazine (Rizzoli, 2022)

The Truth About Crypto: A Practical, Easy-to-Understand Guide to Bitcoin, Blockchain, NFTs, and Other Digital Assets by Ric Edelman (Simon & Schuster, 2022)

The Book of Crypto: The Complete Guide to Understanding Bitcoin, Cryptocurrencies and Digital Assets by Henri Arslanian (Palgrave Macmillan, 2022)

The Genius of Algorand: Technical Elegance and the DeFi Revolution by Anthony Scaramucci (SALT Books, 2022)

The Blockchain Future: Bitcoin, Cryptocurrency, Blockchain Technology, DecentralisedDecentralised Ledgers, Smart Contracts, Crypto Wallets, NFTS and Web 3.0. What … do in the real world now and in the future! by Robert B. Seymour (Independent, 2022)

Metaverse Investing Beginners to Advance Invest in the Metaverse; Cryptocurrency, NFT (non-fungible tokens) Crypto Art, Bitcoin, Virtual Land, … 2022 & Beyond by The Meta-Verse

(Metaverse Investing Books, 2022)

Secret Lives by Mark de Castrique (Poisoned Pen Press, 2022)

Crypto-Finance, Law and Regulation. Governing an Emerging Ecosystem by Joseph Lee (Routledge, 2022)

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