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March 19, 2024

Permissioned Blockchain

March 19, 2024
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A permissioned blockchain is a type of distributed ledger technology (DLT) that operates under a specific set of rules and guidelines, restricting access and participation to a select group of known entities. Unlike public blockchains that allow anyone to join and validate transactions, permissioned blockchains are designed for consortiums or organizations seeking to establish a trusted network for conducting business transactions securely and efficiently.


In contrast to public blockchains, which rely on a decentralized network of anonymous participants to validate and record transactions, permissioned blockchains are built upon a more controlled and centralized infrastructure. The consensus mechanism in a permissioned blockchain is typically based on a predetermined and trusted group of validators who must collectively agree on the validity of transactions. This approach allows for higher scalability and faster transaction processing times compared to public blockchains.


  1. Enhanced Privacy and Security: Permissioned blockchains offer a greater level of privacy and security compared to public blockchains. By limiting access to known entities, organizations can ensure that only authorized participants can view and transact on the blockchain. This is particularly critical in industries where sensitive information needs to be handled securely, such as financial services and healthcare.
  2. Efficient Transaction Processing: Due to the controlled nature of permissioned blockchains, transaction processing times are considerably faster compared to public blockchains. With a predefined set of validators, consensus can be achieved more rapidly, enabling organizations to conduct business transactions efficiently and in near real-time.
  3. Regulatory Compliance: Permissioned blockchains can be designed to meet regulatory requirements without compromising the trust and transparency provided by blockchain technology. The restricted access and oversight inherent in these blockchains make it easier for organizations to comply with data protection, know-your-customer (KYC), and anti-money laundering (AML) regulations.


  1. Supply Chain Management: Permissioned blockchains have emerged as a valuable tool in supply chain management. They enable seamless tracking and tracing of goods across multiple stakeholders, reducing counterfeit products, enhancing transparency, and promoting sustainability practices.
  2. Financial Services: The financial sector has embraced permissioned blockchains to streamline various operations, including payment verification, cross-border transactions, trade finance, and smart contracts. These blockchains allow financial institutions to collaborate securely and execute transactions efficiently, reducing the need for intermediaries and eliminating unnecessary delays.
  3. Healthcare: In the healthcare industry, permissioned blockchains offer a secure platform for storing and sharing sensitive patient information. With proper access controls, healthcare providers and insurance companies can ensure data integrity, streamline claims processing, and facilitate interoperability between different systems.


Permissioned blockchains bring a controlled and regulated approach to utilizing blockchain technology. With their restricted access and predefined group of validators, they offer enhanced privacy, security, and efficiency compared to public blockchains. Industries such as supply chain management, finance, and healthcare have recognized the potential of permissioned blockchains in streamlining operations, improving trust, and enabling seamless collaborations. As organizations continue to explore the vast possibilities of blockchain technology, permissioned blockchains provide a tailored solution that can meet the specific needs and requirements of enterprise-level applications.

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