Are private variant of Ethereum or any other private blockchain solution just a glorified distributed database?

Other than the fact that the data structure is cryptographically made immutable through SHA3 thus making it auditable, plus smart contract capability and plus the digital signatures that provide authenticity and non-repudiation, what are the distinctive differences between private blockchains and distributed database?

This is one question that I always get.


I always say that a private blockchain is like a distributed database where every node is a master node (normally distributed databases only use one master node). Also in the distributed databases, there is no guarantee there is a way to know if your node has the most recent version of the database, in case of the blockchain you do.

Personally, I am in favour of the usage of private blockchain in order to improve the usability of the new generation of DApps. The current state of public blockchains such as Ethereum makes the implementation of DApps much harder due to its low performance (a tx might take several minutes to be confirmed) and the cost (around 0.02 USD per tx). Implementing a private blockchain you could have a finality of 2-3 seconds per tx and you could even make the tx cost-free for validator nodes (in case of PoS)

In think, groups of small companies will join together to build private blockchain sharing the cost of a distributed infrastructure and building new community economies which will eventually remove the control of big corporations such as Facebook, Gmail, etc.

  • Not sure about the "most recent version", blockchain doesn't guarantee it. In a private chain it might be worse: transactions thought to have been finalised might all of sudden be wiped out from history, due to a selfish miner publishing a hoarded longer chain. On a public chain this attack is more difficult though. – Linmao Song Mar 10 '19 at 15:51

One key difference is that permissioned blockchains are usual for federated use cases. Multiple, potentially competing, organisations use the same ledger.

  • There is no one person, a super sysadmin, that can read and write all the data

  • All writers and write only their own records - one incompetent or malicious party cannot corrupt records of others

  • Usually the ledger has only minimal information about transactions and limits the exposure of other informaiton

  • You can have channel structures, like in JP Morgan Quorum, to limit the scope of data you can decrypt and read and private messages between participants

A blockchain is not just a database, but also has features of P2P network and so on.

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.