Blockchain Architecture
Private blockchains use a centralized architecture with permissioned nodes managed by a single organization. Key elements include:
- Nodes : Authorized participants that validate transactions and maintain the ledger
- Blocks : Securely store encrypted transaction data in chronological order
- Transactions : Digitally signed actions (e.g., asset transfers) recorded immutably.
- Consensus Layer : Ensures agreement among nodes using protocols tailored for permissioned networks.
Consensus Algorithms
Private blockchains prioritize efficiency and control with algorithms like:
- Proof of Authority (PoA) : Validators are pre-approved entities that reduce energy consumption.
- Practical Byzantine Fault Tolerance (PBFT) : Handles malicious nodes while ensuring fast transaction finality.
- Delegated Proof of Stake (DPoS) : Stakeholders vote for delegates to validate blocks, balancing speed and decentralization.
Smart Contracts & Automation
Self-executing smart contracts automate workflows (e.g., supply chain tracking) while enforcing predefined rules. They reduce intermediaries, enhance transparency, and enable tamper-proof agreements.
These components enable startups to build secure, scalable networks tailored for internal processes like asset management or regulatory compliance. With this, let’s go with the processing to develop a private blockchain for startups.