Deciphering Hybrid Blockchain Technology and Its Use Cases

Posted By : Ayush

Apr 28, 2021

What is Hybrid Blockchain?


Hybrid Blockchain means the combination of the two types of blockchains i.e private blockchain and public blockchain. By the combination of the best features of both public and private blockchains, we can achieve more security and faster blockchain solutions. Hybrid blockchain provides the organization more control over what they want instead of changing their plans due to limitations of the public or private blockchain solutions.


Utilization of Distributed Technologies for Custom Solutions: Public,  Private, and Hybrid Configuration Variations | by Applicature | Applicature  | Medium











Components of Hybrid Blockchain


There are basically two components of hybrid blockchain namely public blockchain and private blockchain.


1: Public Blockchain


A public blockchain is open to, permissionless, and globally distributed network where anyone can participate and perform their work such as read, write and contribute to the network. No single person owns the network, every participant owns the network.


What are the blockchain types? - Quora



Benefits of public blockchain are:

1: Decentralization

2: It uses advanced cryptographic methods for securing data.

3: No permission is required for individuals to take any action on the blockchain network.


Drawbacks of public blockchain are:


1: Achieving consensus in the public blockchain is very time-consuming.

2: Very high computation power is required.


Examples of public blockchain are NEO, Ethereum, Bitcoin, etc.


2: Private Blockchain


A private blockchain is also known as a permissioned blockchain or enterprise blockchain. In a Private blockchain, only specific persons can participate and share information. It is basically owned by a small group of people forming an organization and allowing only desired persons to enter the chain.


Benefits of Private blockchain are: 


1: Faster settlement using different protocols


2: Better control over the participants engaging in the network.


3: More privacy as we have complete control over the data and manage sensitive data within our own hands.


4: Scalability i.e size of the blockchain can be decided as per needs.


Drawbacks of private blockchain


1: It does not ensure decentralization and anonymity.


2: Trust building is required within the network participants for transferring confidential information within the network.


The most popular private blockchain platform is Hyperledger Fabric. 


Hybrid Blockchain


It combines the best features of both public and private blockchain solutions as a result we have the public blockchain with controlled user access and data security with faster mechanisms.


Hybrid blockchain: The best of both public and private Blockchain |  2019-07-19 | DC Velocity


How Do the Users Function in The Hybrid Blockchain?


Once a user gets the grant to access the hybrid blockchain platform, he can fully participate in the blockchain’s activities. He shares equal rights to do transactions, view them or even append or modify transactions. However, one thing that is kept a secret is the identity of the users from other participants. This is done to protect the user’s privacy.


A Hybrid Blockchain Architecture for Privacy-Enabled and Accountable  Auctions | Semantic Scholar


Advantages of Hybrid Blockchain


1: Selective access to the blockchain network.


2: Very flexible i.e users can easily join private blockchain with public blockchains.


3: Transaction is verified within the private network


4: Implies more complex and advanced hashing power


5: The transparency and security of the network are improved


6: Low transaction cost as it needs only a few nodes to verify


7: Immune to 51 % attack as no hackers can participate in the network


One of the examples of a Hybrid blockchain is Dragonchain.


Use cases of Hybrid Blockchain


1: We want to share my medical data easily with my doctor and health insurance company, but also want to ensure personal privacy and security.


2: We want to use private payment systems on public networks


3: An area where hybrid blockchain technology can be implemented is the Hybrid IoT (Internet of Things). Public blockchain solutions can be tricky as they could give hackers free access to data and nodes, but hybrid blockchain places devices in a private network and provides selective access to people who need them. Conversely, the managing authority can also decide which aspects of the network can be made public.


XinFin [ XDCE ]


It was launched in 2017 and launched its first decentralized Application i.e TRADEFINEX after completing ICO in march 2018. TRADEFINEX is a global trade and finance platform.


XinFin is the first hybrid blockchain built on a public blockchain Ethereum, and a private blockchain Quorum.


TradeFinex on XinFin Hybrid Blockchain enables UnBanked Population with  Peer to Peer cross Trade Finance | by XinFin XDC Hybrid Blockchain Network  | XinFin | Medium




Relying only on public or private blockchain won't solve every problem in the market.
Some organizations want to take benefits of blockchain technology but don't want their business and data to be exposed to the whole world. So in that case hybrid blockchain solutions can be a great alternative to such problems.

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June 11, 2024 at 03:26 pm

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