A blockchain is a very specific type of database mostly used in the world of finance such as order to cash, asset tracking, trade finance, and most importantly cryptocurrencies(for which it was originally created).
As the name suggests, it is used to store data in various blocks which are connected through chains. The data entered in a block cannot be rewritten and after putting in the data, the block is then connected to the previous block thus synchronizing the data chronologically.
The most common use of blockchains these days is to be used as a ledger of transactions which are mostly used for recording various transactions of cryptocurrencies such as bitcoin, etherium or bitcoin.
The decentralized blockchains are irreversible, i.e., once a chain has been created it cannot be removed.
Various Types of Blockchains
A private blockchain is the one where there is a restriction over the use of the blockchain and only the user with an authorized permission to operate the database can add new information into it. The most common use of these blockchains is in private organizations or enterprises where only a few selected personnel. The level of control an authorized member has on a blockchain is completely in control of the organization. Some of the examples for the use of private blockchains could be voting, supply chain management, asset ownership, etc.
A public blockchain is very similar to the private blockchain, having the same framework, and the only key difference being that a public blockchain is non-restrictive and can be accessed by anyone with access to the internet. The person just has to sign up for the access to the blockchain and can use it for various purposes including but not limited to accessing past and current records, verifying transactions and also do mining. Thanks to the increasing use of cryptocurrency, the most common use of public blockchains is for mining or exchanging cryptocurrencies.
Even though these are broadly the different types of blockchains, there are two more variations discussed below
These types of blockchains are a combination of the private and public blockchains having key features of both of them, i.e., one blockchain can have both a private permission based system as well as a public permission less system. By doing this, the blockchain can have both the sensitive information, which cannot be made public, be private and the other remaining data can be made publicly available for the use of others.
Consortium blockchain is a special type of private blockchain. As we have seen before that a private blockchain remains in the confines of a single organization, on the other hand, a consortium blockchain pans over more than one organization which can then act as a node and exchange information or do mining. These types of blockchains are mostly used in banks, government, organizations, etc.