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I am bit confused by the solutions claiming that their technology is based on blockchain. However it is private blockchain.

To my understanding: biggest benefit of blockchain is being decentralized so no one party can control the write hence maintain the Integrity.

However if it is private blockchain then how it is better than traditional DB, albeit CRUD is replaced with read and write only.

What added benefits it offers and why it is superior-- if it is?

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  • Might be worth considering traditional distributed databases in your comparison as well? Feb 28 '18 at 9:04
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If you're not crossing the boundaries of trust, then you're always better with a traditional database. However, if you're crossing the boundaries of trust, then with blockchain you have a technology which allows you to run a central model without the need for a central infrastructure and a trusted 3rd-party managing this infrastructure.

Everything else is a definition of the scope and access to the network!

  • public vs private
  • permissioned vs unpermissioned
  • authoritarian vs egalitarian

(sidenote: You can get more details from the blogpost I wrote on this topic).

The case for the public/unpermissioned/egalitarian blockchain is obvious -> Ethereum/Bitcoin.

In total contrast to that, you also can have a private/permissioned/authoritarian blockchains too that totally make sense!

An example for such private chains would be a consortium of banks needing a shared ledger for their business, but not trusting each other enough so that someone within the consortium can be picked for hosting it. In such cases, the consortium would traditionally found a new company, which serves as the trustworthy 3rd-party, however, with blockchain they can avoid this. The result is: saving costs, better security/integrity of data, audit trail/history for free, etc.

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  • good explanation. Referring to your post aren't "Public permissioned authoritarian" While one authority controls transaction authorization where other can control the on-boarding. Does not the controlling authority, who controls the transaction authorization defeats the purpose of blockchain. As they can change the chain as they control it. Further, it appears to me like traditional DB with some admins(in your example govt ) allowing access to view it however transaction authorization is controlled by central DB-- in the hands of one entity
    – x0rcist
    Feb 28 '18 at 4:51
  • Reading that paragraph again I am noticing that it's sounds ambiguous. With central authority I mean a set of institutions and not only one. If it would be only one, you're right, you can setup a central DB again. Let's take Ripple as example. If Ripple Inc is the only authority in the network, I wouldn't trust it. But if the authority consists of multiple companies, then I maybe don't trust a single one, but I trust in the fact that not all of them are corrupt.
    – ivicaa
    Feb 28 '18 at 5:00
  • For Ripple, as far I know, all validating servers, currently, are maintained by RippleLabs. If this is true, they how people are trusting them???
    – x0rcist
    Feb 28 '18 at 5:05
  • According to their announcements, the number of validator nodes expanded to 55 more companies -> ripple.com/insights/… (I hope they are not all hosted at RippleLabs, didn't check that ;-)). However, the point is, even authoritarian systems can reach a pragmatical level of decentralisation.
    – ivicaa
    Feb 28 '18 at 5:08
  • can you give an example that "authoritarian systems can reach a pragmatical level of decentralisation"
    – x0rcist
    Feb 28 '18 at 5:19
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Blockchains versus Traditional Databases

To understand the difference between a blockchain and a traditional database, it is worth considering how each of these is designed and maintained.

Traditional Databases

Traditional databases use client-server network architecture. Here, a user (known as a client) can modify data, which is stored on a centralized server. Control of the database remains with a designated authority, which authenticates a client’s credentials before providing access to the database. Since this authority is responsible for administration of the database, if the security of the authority is compromised, the data can be altered, or even deleted.

Blockchain Databases

Blockchain databases consist of several decentralized nodes. Each node participates in administration: all nodes verify new additions to the blockchain, and are capable of entering new data into the database. For an addition to be made to the blockchain, the majority of nodes must reach consensus. This consensus mechanism guarantees the security of the network, making it difficult to tamper with.

In Bitcoin, consensus is reached by mining (solving complex hashing puzzles), while Ethereum seeks to use proof of stake as its consensus mechanism. To learn more about the difference between these two consensus mechanisms, read This help link

Integrity and Transparency

A key property of blockchain technology, which distinguishes it from traditional database technology, is public verifiability, which is enabled by integrity and transparency.

  • Integrity: every user can be sure that the data they are retrieving is uncorrupted and unaltered since the moment it was recorded
  • Transparency: every user can verify how the blockchain has been appended over time

CRUD vs Read & Write Operations

In a traditional database, a client can perform four functions on data: Create, Read, Update, and Delete (collectively known as the CRUD commands).

The blockchain is designed to be an append only structure. A user can only add more data, in the form of additional blocks. All previous data is permanently stored and cannot be altered. Therefore, the only operations associated with blockchains are:

  • Read Operations: these query and retrieve data from the blockchain
  • Write Operations: these add more data onto the blockchain

Validating and Writing

The blockchain allows for two functions: validation of a transaction, and writing of a new transaction. A transaction is an operation that changes the state of data that lives on the blockchain. While past entries on the blockchain must always remain the same, a new entry can change the state of the data in the past entries. For example, if the blockchain has recorded that my Bitcoin wallet has 1 million BTC, that figure is permanently stored in the blockchain. When I spend 200,000 BTC, that transaction is recorded onto the blockchain, bringing my balance to 800,000 BTC. However, since the blockchain can only be appended, my pre-transaction balance of 1 million BTC also remains on the blockchain permanently, for those who care to look. This is why the blockchain is often referred to as an immutable and distributed ledger.

In short, the difference is Decentralized Control

Decentralized control eliminates the risks of centralized control. Anybody with sufficient access to a centralized database can destroy or corrupt the data within it. Users are therefore reliant on the security infrastructure of the database administrator.

Blockchain technology uses decentralized data storage to sidestep this issue, thereby building security into its very structure.

Though blockchain technology is well-suited to record certain kinds of information, traditional databases are better suited for other kinds of information. It is crucial for every organization to understand what it wants from a database, and gauge this against the strengths and vulnerabilities of each kind of database, before selecting one.

Thanks

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  • Thanks but didnt you miss to answer main aspect: my question is related to Private blockchain implementations. Which are managed by single authority. If this is so: then what is the hype of new companies boasting of using blockchain solutions whereas they are managing it privately -- like the traditional DB.
    – x0rcist
    Feb 28 '18 at 3:57
  • so what do you say how private blockchain solution are better and what benefits they offer against traditional DB. Or they are just hype. Trying to ride the blockchain bandwagon
    – x0rcist
    Feb 28 '18 at 4:03

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