What Is a Network?
A network refers to the collective of nodes that participate in the operation of a blockchain at any given moment.
Nodes validate new transactions and update the ledger accordingly. Together, these nodes form the entire blockchain network.
How Does a Network Work?
A blockchain network facilitates the recording of transactions, which can be utilized for constructing smart contracts.
These contracts enable the execution of more complex systems and the operation of decentralized applications (DApps).
In a public blockchain network, anyone can track payments, orders, accounts, and transactions through the ledger.
The network is governed by predetermined policies established before its creation.
What Are the Features of a Blockchain Network?
Blockchain networks possess several key features:
- Speed: Confirmation times on blockchain networks range from seconds to minutes.
- Consistency: Blockchain networks operate continuously, 24/7.
- Cost: These networks can function with low transaction fees, often under one cent per transaction.
- Security: The nodes within a blockchain network contribute to its security, guarding against hacking attempts.
- Immutability: A blockchain network maintains a tamper-proof record of payments, visible for transaction audits.
Types of Blockchain Networks
There are two primary types of blockchain networks
Public Blockchain Network: A public network is resistant to censorship and can be accessed by anyone worldwide. The distributed ledger allows for transaction verification. Public networks employ various consensus mechanisms, typically proof-of-work or proof-of-stake. Bitcoin and Ethereum are examples of popular public networks.
Private Blockchain Network: A private blockchain network is operated by a single entity or a specific group that grants access to its distributed ledger. It is a permissioned network, and different nodes may have varying levels of permissions. Private networks are often less decentralized or entirely centralized and are commonly used by enterprises to record transactions or maintain internal data records.