Many assume that one needs to opt for a private blockchain system in order to have the benefits of a blockchain system while still maintaining the privacy and security required to handle sensitive data.
Underlying this assumption are many misconceptions, which could lead to government projects losing out on the key benefits of blockchain technology.
The Internet as analogy for public blockchain and private ledgers
The difference between a public blockchain and a permissioned ledger is like the difference between the public Internet and an Intranet. Everyone can access and profit from the Internet, while an Intranet will be owned by a company to use for their internal online system – exclusively for use by employees with the proper authorisation.
Some blockchain-type projects are permissioned, meaning you need the system’s permission to use it. Whereas on a public blockchain, anyone can access and use the data.
Are private ledgers better than public blockchains
Ron Austring, Chief Scientist of EHR Data, is merging the worlds of healthcare, data, technology and blockchain to design and implement software solutions to solve healthcare data challenges in collaboration with the public sector.
Weighing private and public blockchains according to the Internet analogy, he says: ‘We want our project to be built on an Internet-type infrastructure so that once you build out something like what we’re building out. We chose the public ledger because we don’t really know the future.’
Ron continues to state that a website built exclusively on your company’s Intranet, won’t give you much exposure to the rest of the world. On the other hand, if you go with a public blockchain from the start, you know right away that your services could be used by other entities that are on that public blockchain.
Advancing from a private ledgers to a public blockchain for a public project
Muhammad Salman Anjum, managing director of Aventis Tech, a B2B and B2C blockchain provider and Head of BSV Hub – Middle East South Asia acknowledges that government entities may need time to become familiarised with the blockchain concept before opting for a public blockchain.
‘For us it was a step by step process, from starting to explore the concept with permissioned ledgers, to understanding the value of a public blockchain,’ he explains.
‘Once they start using it, it will likely serve as a gateway to the public blockchain – as in our case where we are seriously exploring the use case of putting public blockchains for our solutions. We have done several probationary projects and have seen the potential of a blockchain-based government solution on public blockchains.
The challenge of helping government entities understand the value of public blockchain
Ahmed Yousif, the Digital Transformation and Strategy head of Mecca Municipality and Middle East Lead of the BSV Blockchain for Government Initiative, admits that it’s challenging to persuade government entities of the value of a public blockchain, as there is still a lot of education to be done. And yet, he is convinced that public blockchains are here to stay:
‘We are currently exploring real life applications of a public blockchain so it’s definitely going to happen somewhere down the road. It’s similar to when the Internet launched in 1995 and people were just starting to explore it. It wasn’t all that clear what it was about. But, if people knew back then what was going to happen now, they would have jumped in first and said: OK, we want to be an early adopter!’