What is a Public Blockchain?
In 2009, when the first cryptocurrency, Bitcoin, came into existence, Satoshi Nakamoto wished for a financial world with no centralized authority to control users’ finances. One of the primary goals of creating crypto based on blockchain was to create a public blockchain ledger. This would eliminate the need for a supervisor who has control over your funds and transactions, and charges steeply to execute the transactions on top of it.
Now, what is a public blockchain? A public blockchain ledger is a block system containing various kinds of information. These blocks can be fed with data by anyone who has joined the network and is ready to validate the transactions. It is the mother technology of blockchains and offers some incentive to the users if they validate the blocks and add them to the public ledger.
Public blockchain networks usually function based on proof of work or proof of stake consensus models where the participants have to validate blocks to maintain the chain, and get rewarded in return. Public blockchain networks have eliminated the need for a third party to control or make the transfer of data possible. The participants on the network can do all that by themselves. In technical terms, a public blockchain ledger can thus be defined as a self-governed, decentralized, and autonomous public ledger. The participants themselves secure a public blockchain ledger, and the data added to the block cannot be reversed easily.
Characteristics of Public Blockchain Networks
While learning about what is a public blockchain, you will require knowledge about its architecture as well. A public blockchain ledger has simple characteristics, which is why it has become popular globally. The architecture of a public blockchain ledger is what makes it different from other kinds of blockchains. Some of the prominent characteristics of a public blockchain are:
- Every participant or node on the network has access to read or write on the ledger.
- Any participant can also download the data from the ledger or make another user a node.
- It is an example of completely decentralized technology since no central authority exists to control the public blockchain ledger.
- The advantages of public blockchain include anonymity, as no one can track the transactions.
- A public blockchain is a bit slow compared to other ledger forms.
Key Advantages of Public Blockchains
The many advantages of public blockchain ledgers include:
1. Higher Transparency
While introducing public blockchain technology to the world, Satoshi showed the world what liberty in financial transactions looked like. Central banks and authorities have always hidden the transaction processes from the public and charged various fees to transfer money from one place to another. A public blockchain ledger is completely transparent, and anyone can read the information related to each transaction. Every participant can keep a track of any transaction that they want. This removes the need for a third party to confirm the transaction. Public blockchain keeps things out in the public eye to earn the trust of its users. Also, the data can be validated by anyone, and the whole system flows with the help of each participant.
2. Fully Decentralized Structure
One of the biggest advantages of public blockchains is the decentralization it offers. This technology creates a ledger that can be accessed and edited by anyone with an active internet connection. The edits cannot be done to already added blocks, but users can pick up a transaction, validate it and add it to the block. The flow of information on a public blockchain only occurs in this manner. All the nodes in the network have a copy of the whole ledger, and they can use consensus mechanisms like proof of work or proof of stake to validate the blocks. There is no requirement for a central authority in a public blockchain ledger.
3. User Authorization
Another of the key advantages of public blockchain networks is that they offer user authority from the very base. This means that any participant with active internet on their device can download the ledger and access the information regarding the transactions. There is no access denial on the whole ledger, making it easier for every participant to access the data. It also means there is no place for an evil central authority in the public blockchain ledger.
User access and authorization are among the advantages of public blockchains. Since a public blockchain gives authority to the end users, there is no chance of fraud or data theft. Moreover, to reverse the data added to the block, anyone would have to get support from at least 51 percent of the participants, which is quite difficult.
4. Immutable Network
Now, one of the biggest concerns of a common person while doing transactions with a bank or any other institution is what if there is fraud committed in the middle of the transaction. This would make the end user lose their funds and thus lose faith in the overall system. To eliminate any such worries, the public blockchain provides an immutable network. This means that once a data set is added to the blockchain, it cannot be reversed. Moreover, no one can tamper with ongoing transactions or steal money from them. Even if anyone tries to hamper the transactions or double spend, the other nodes on the public blockchain networks will reject the transaction. This removes the possibility of transaction fraud or even identity theft from the bigger picture.
Public Blockchain Examples
As you set out to learn ‘what is a public blockchain?’, you must know various public blockchain examples as well. There are several big names on this list, and you must have heard about them at least once. Firstly, the biggest name on this list is the Bitcoin blockchain. It was the first ever cryptocurrency, and Satoshi framed it to work on a public blockchain ledger.
Understanding various public blockchain networks helps users know when it is best to use a public blockchain ledger and when not. Some other big names in this list are Ethereum and Litecoin. Mostly, a public blockchain network works on the proof of work consensus like Bitcoin. But some examples of public blockchain networks like Cardano even use proof of stake for the functioning. In both cases, these examples of a public blockchain make it easier to realize how important a decentralized financial system is.
When Satoshi Nakamoto first launched Bitcoin, even he might not have thought that his idea would travel such a long journey so fast. In just ten years, Bitcoin has become one of the world’s biggest assets and helps bring decentralization to the financial world. We do hope with this post, you have the answer to ‘what is a public blockchain?’. Like every other asset, various public blockchain examples have their shortcomings too. But the bigger fact is that public blockchain networks help bring decentralization to the world.
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