Blockchain networks vary in terms of access control, participation, and security models, making them suitable for different use cases. The security of a blockchain largely depends on whether it is public or private, which determines who can participate, and whether it is permissioned or permissionless, which defines how participants gain access to the network.

Public vs. Private Blockchains

• Public Blockchains: These networks are open to anyone, allowing participants to join, validate transactions, and maintain anonymity. A public blockchain operates through a decentralized, trustless mechanism, often using Proof of Work (PoW) or Proof of Stake (PoS) consensus algorithms. The most well-known example is Bitcoin, where miners compete to solve complex cryptographic puzzles to validate transactions and add them to the ledger. While public blockchains offer high decentralization and transparency, they can also be vulnerable to security risks like 51% attacks if a single entity gains majority control.
• Private Blockchains: Unlike public networks, private blockchains restrict access to a specific group of participants, typically organizations that form a business consortium. These networks require identity verification and access control mechanisms to regulate participation. Consensus is achieved through selective endorsement, where only authorized members validate transactions. Private blockchains provide greater security, efficiency, and compliance, making them ideal for enterprises handling sensitive financial or regulatory data. However, they sacrifice decentralization in favor of control.

Permissioned vs. Permissionless Blockchains

• Permissionless Blockchains: In a permissionless blockchain, there are no restrictions on participation—anyone can join, validate transactions, and maintain the ledger. These networks prioritize decentralization and transparency, making them well-suited for cryptocurrencies and decentralized applications (dApps). Since there are no identity controls, security is primarily enforced through cryptographic mechanisms and consensus algorithms.
• Permissioned Blockchains: In contrast, permissioned blockchains restrict access to a select group of users who are granted specific roles and permissions using identity-based certificates. These blockchains are more secure and less susceptible to malicious activity, as only pre-approved nodes can validate transactions. Enterprises and financial institutions favor permissioned blockchains for compliance, regulatory adherence, and operational efficiency.