Hybrid Blockchain

[TL; DR]

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1. A hybrid blockchain is a unique blockchain that combines the features of both public and private blockchain.
2. Transactions in hybrid blockchain are kept private but can also be verified.
3. A well-known hybrid blockchain is XinFin; it is developed by Ethereum (public blockchain) and Quorum (private blockchain).
4. A hybrid blockchain offers decentralized access, data security, transparency, reduced transaction costs, verifiable transactions, fast transactions, etc.
5. It finds use in global trading, supply chain management, banking, government work, etc.


[Full Article]

Blockchain is the foundational technology on which the next-gen innovations such as NFTs, crypto, Web 3 are built.

It is positively changing almost every industry globally, as its unique system of recording and storing transactions is handy.

If you're familiar with the tech space, the chances are high that you'd have heard of public and private blockchains as they are pretty popular. For context's sake, these blockchains are as their names suggest.

There is another burgeoning type of blockchain, a mix or midpoint of those above. It is called “hybrid blockchain.”

Let's take a look at it.

What Is a Hybrid Blockchain?

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A hybrid blockchain is a unique blockchain that combines the features of both public and private blockchain.

Generally, a hybrid blockchain gives you the merits of both types of blockchains while limiting their demerits.

It offers controlled access and, of course, freedom to users while still offering data security. Transactions are not made open to all but can be made public for verification reasons.

Users of a hybrid blockchain can determine who can partake in the blockchain or which transactions are made public.

A popular hybrid blockchain is XinFin. It is the first and only one existing at the moment. XinFin is an interoperable blockchain network developed on Ethereum (a public blockchain) and Quorum (a private blockchain); its coin, XDC, powers this blockchain.

It facilitates smart contracts and ensures speedy transaction time, efficiency, and KYC to Masternodes (Validator Nodes). It is used in global trading.

Since we have established that a hybrid blockchain combines public and private blockchain facets, let us consider its features.

Features Of a Hybrid Blockchain

These are the features of a hybrid blockchain:

Data Security
Typically, public blockchains don't guarantee total security due to their unrestricted access. With private blockchain, however, that is not a problem.

In a hybrid blockchain, access and freedom are granted but also security. Data is securely kept in the nodes, and transactions can't be publicly altered.

Decentralized Access
A major staple of blockchain lies in its decentralized nature.

In public and private blockchains, the issue of central control is different. But for hybrid blockchain, decentralization is tailored to a specific need.

For example, data can be made inaccessible to the public in a company. Likewise, it can also be made public when verifying transactions.

Transparency
A select group determines what nodes access or partake in a transaction in private blockchains. For public blockchains, access isn't restricted, so transparency is guaranteed.

In hybrid transactions, access is controlled. However, transparency is ensured.

Benefits Of a Hybrid Blockchain

Let us consider the benefits of a hubris blockchain:

Flexibility
The mechanism in place for public and private blockchains is fixed. For hybrid blockchain, however, there exists flexibility.

You can constantly modify the degree of decentralization, transparency, and safety required in the network.

Reduced Transaction Costs
The hybrid blockchain takes a few nodes to verify transactions, which directly reduces the transaction cost (it can get as low as $0.01 per transaction!)

Here, the most influential nodes in the network make it straightforward to verify the transaction, which would take about a thousand nodes in the case of the public blockchain.

Speedy Operations
Like private blockchain, hybrid blockchain offers speedy transactions, unlike public blockchain that would require an extended period due to the high number of nodes on the network.

Data Security
Hybrid blockchain offers a higher level of data security than public blockchain and grants controlled access, unlike private blockchain.

When a node joins a hybrid blockchain, they have extensive access to the network. Their identity is maintained and protected from other users, except they participate in transactions. Then, their identity is disclosed to the other party.

Also, a hybrid blockchain operates in a closed ecosystem, which prevents any form of information leak on the part of organizations.

Protection From 51% Attack
A 51% attack breaches a blockchain network by miners that regulate more than 50% of the network's computing power to prevent or reverse new transactions.

A 51% attack is impossible with hybrid blockchain because hackers cannot have access as the network is closed.

Every blockchain type finds use in an industry that dovetails with its characteristics, which is not different from the hybrid blockchain. There let us consider where it can be applied.

Applications Of a Hybrid Blockchain

These are scenarios where hybrid blockchain can be applied:

Worldwide Finance and Trade
Hybrid blockchain through XinFin can be beneficial to the finance community. Their goal is to procure a global finance and trade platform.

Banking
Since hybrid blockchain possesses the features of controlling access, carrying out transactions on time, securing them, and publicly verifying transactions, it can be a suitable addition to banking.

Banks need to work out issues privately and secure user information, so they can use this approach.

Supply Chain
The supply chain is too broad to work with either public or private blockchain networks as their limitations can affect the whole chain of command.

Hybrid blockchain would solve existing supply chain issues like data fraud, incorrect information, inefficiency, lack of transparency, insecurity, etc.

Conclusion

Hybrid blockchain combines the best of both worlds (public and private blockchain) without drawbacks.

It is revolutionary and an absolute game-changer in the tech community.



Author: Valentine A. , Gate.io Researcher
This article represents only the researcher's views and does not constitute any investment suggestions.
Gate.io reserves all rights to this article. Reposting of the article will be permitted provided Gate.io is referenced. In all cases, legal action will be taken due to copyright infringement.