Roo's All-In Giveaway, $300,000 in Prizes
Sponsored
1.7 k views

We do not provide any kind of financial advice. Always DYOR.

The Difference between an ‘Open-Community’ and ‘Closed-Network’ Blockchain

R3 is a consortium of about 200 firms coming together to research and develop distributed database models somewhere along Bitcoin’s lines. Usually, they receive a lot of heat as they say they are researching a corporate or private model of “Blockchain” but are developing a version of Distributed Ledger Technology (DLT). This debate between a Public Blockchain and a Private Blockchain (yes, it’s an oxymoron) is the center of great distress.

Another such debate that hasn’t reached the mainstream yet, as it falls under the Public Blockchain category, is the difference between an Open-community Blockchain vs. a Closed-Environment Blockchain. You can think of Bitcoin as an Open-community ecosystem and Ethereum as a member of the other side of the spectrum.

Open Community Blockchains

A blockchain application that is open for all participants to read, audit, edit, and argue about the blockchain network’s internal functioning is a public blockchain. A public blockchain is most relevant because it functions as an autonomous entity that does not depend on established organizations to proctor the network’s day-to-day functioning. A public blockchain is actively used, illustrated, and developed by network participants that back the idea of an open-source, delegate-free, secure network that can be readily used. Customization is an embedded feature of such a network, as all code is open for anyone to use, copy or replace.

Bitcoin, Ethereum, Monero, Litecoin, and Dogecoin are just some examples.

Closed Environment Blockchains

A closed-environment blockchain is a network established on the trust and merit of legitimate organizations or participants, capable of handling the responsibility and authenticity that needs to be provided on the network. They are the sole authorities taking care of the network’s growth by actively looking after the execution and relay and, simultaneously, checking for internal threats that may arise from malicious actors working against the network.

Bitcoin live price
Btc
Bitcoin
$26.591
price
0.04571%
price change
TRADE NOW

Difference between Open-Community and Closed-Network Blockchains

Public ‘open-community’ Blockchains Public ‘closed-network’ Blockchains
Consensus An open networked blockchain majorly depends on the users or delegated participants appointed by the users to reach a consensus about various network decisions. A closed-networked blockchain readily reaches a consensus as all participants know each other through distributed delegation rights.
Source Code Read, audited, and altered by the entire network. It can be read by the network but audited and altered by delegated maintainers.
Development Developed for open-source, free use for participants It can be developed for commercial use as well as limited open-source use
Community participation An active community of participants readily volunteers to improve the network. The delegated responsible participants are given the right to change the source code in the community’s best interest.
Information processing Relaying information or transaction on the network is relatively open, and any network participant can do so without much. Although the open nature makes it inefficient and time-consuming The transactional capabilities can reside in the hands of the delegate responsible for maintaining the network. Information can even be censored and restricted, depending on the governance of the network.
Common Vision The vision can change over time, mostly due to the relatively high turnover of open-source community workers. Bitcoin started as an experiment by the cyberpunk group and didn’t take long to become a prospect for the future of money. A common vision is set beforehand to ensure all developers and managers can reach a common goal. For example, the founding vision of Ethereum was to develop a Globally distributed computer, and it is well on its way to doing so.
Remuneration and Incentivization The only incentives the users of an open network could receive are the benefits of using such a network and the remuneration the network has agreed upon for such participation. As it could be deployed for commercial use, the institutions and participants are incentivized to actively make the user experience better and more profitable.
End-user experience A user on the open-community network must be constantly updated with the network’s functioning to be a part of the ongoing changes and suggestions being discussed. A user on the network does not necessarily need to be aware of the constant dialogues that are going on between the maintainers. The maintainers are responsible for making a network that requires minimum user participation and maximum user utility.

Disclosure: This is a sponsored post. Crypto Adventure cannot and does not contain financial advice. The information is provided for general informational and educational purposes only and is not a substitute for professional advice. Trading cryptocurrencies is a highly risky activity and can lead to major losses. Accordingly, before taking any actions based upon such information, we encourage you to consult with the appropriate professionals. We do not provide any kind of financial advice. THE USE OR RELIANCE OF ANY INFORMATION CONTAINED ON THE SITE IS SOLELY AT YOUR OWN RISK. Learn More

Stay up to date with our latest articles

More posts

Using Open-Source Protocols for Developing Scalable Solutions on Blockchain

Blockchain technology's safe, transparent, and decentralized transaction platform might transform several sectors. However, building scalable blockchain solutions can be a challenging task.  This short guide will explore how to leverage open-source protocols to develop scalable blockchain solutions. The article aims to make it easier for developers to plan the realization of robust and secure blockchain applications.  Understanding Open-Source Protocols Open-source protocols, such as Ethereum and Hyperledger Fabric, come from organizations and are available for anyone to code for free. Unlike…

From Web2 to Web3 – How to Move an Existing Project to the Blockchain

Web2 and Web3 are two different generations of the World Wide Web. While Web2 is a centralized platform, Web3 is decentralized and powered by blockchain technology.  The success of Web3 has been enormous, with many people now moving from Web2 to take advantage of its benefits.  However, the path to Web3 is not always straightforward. It is complicated and requires a deep understanding of both technologies. Today's guide will ensure you have the right information to successfully move from Web2…

How to Write a Crypto Whitepaper – A Beginner’s Guide

With the rise of cryptocurrency, it's no surprise that many people want to get involved in the industry. But before launching a successful crypto project, one of the most important steps is writing an effective whitepaper. A whitepaper serves as a document that outlines your project and explains its core components and strategies for success. This process may seem daunting and overwhelming for those who have never written a whitepaper. This guide aims to help beginners understand how to write…

Centralized vs. Decentralized Bitcoin and Crypto Mixers

Many people see cryptocurrencies as a way to keep transactions anonymous and private. However, recent reports suggest that most crypto transactions happen on centralized exchanges, leaving user data vulnerable to theft and fraud. The popularity of crypto mixers has been steadily growing as a way to combat this problem. A crypto mixer is an online service that helps mix funds from different crypto wallets and exchanges.  This strategy makes it difficult for anyone to trace the transaction back to the…

Play-to-Earn (P2E) Games – What Are They and How Do They Work?

Regarding Play-to-Earn (P2E) games, there needs to be more clarity about their concept and how they work.  Behind the Huge Play-to-Earn Success: What's the Idea? Play-to-Earn games are a new way of playing games that have recently gained traction in the gaming world. The basic idea behind them is simple: you can play the game and make money. The concept works by allowing players to earn real money or cryptocurrency rewards for completing certain tasks within the game. Among these,…

Smart Contract Security – Pitfalls and Solutions

Smart contracts are becoming increasingly prevalent as the world moves towards a more digital and automated future. Still, they are far from being the panacea of all technological ills. Smart contracts are self-executing contracts with a predetermined set of rules. They are stored on the blockchain and run by computers, which makes them tamper-proof and reliable. However, as with any new technology, smart contracts have associated risks. This article will explore some of the most common pitfalls and how to…

Looking for Crypto Marketing? Here are The Best Crypto Advertising Agencies in 2023

It is vital to have a strong marketing strategy if you wish to succeed in cryptocurrency. This is where crypto marketing agencies come in. You may successfully promote your project and reach your target audience through a crypto marketing agency.  This article will explore the top crypto marketing agencies in 2023. Moreover, we will look at their services and how to choose the right one for your project.  We will also discuss the benefits of using a crypto marketing agency.…

The Risks of Investing in Crypto Projects without Smart Contract Audit

Smart contracts are self-executing contracts that run on blockchain technology. They are stored and verified on the blockchain, which means they are transparent and cannot be tampered with. This makes them a secure way to conduct transactions without needing a third party.  Despite their many advantages, some risks exist with using smart contracts. One such risk is investing in crypto projects that have yet to have their smart contracts audited by a qualified auditor.  With an audit, knowing whether the…

Top Smart Contract Audit and KYC Companies in 2023

It's no secret that business is undergoing fast change. As a result, companies must adapt when new technologies, like smart contracts, emerge to remain competitive. A crucial part of this adaptation process is ensuring compliance with regulations and safety. This is where a company's KYC (Know Your Customer) process or smart contract audit comes into play.  Working with a reputable smart contract auditor or KYC provider ensures your company is compliant. This blog article discusses the benefits of using a…

Top 5 KYC Solutions for Crypto or NFT Projects

As the importance of blockchain technology grows, many people look for ways to get involved in the crypto world. One of the most important aspects of any cryptocurrency or blockchain project is KYC/AML.  Without proper KYC/AML procedures, your project could be at risk for fraud and illegal activities. This article will discuss the types of KYC solutions available and how to choose the right one for your project.  We will also provide tips on how to implement these solutions properly.…