The Web3 environment is vast and growing rapidly, with new blockchains emerging constantly. So, how many blockchains are there, and what are the 8 main types of blockchains? Join FMCPAY as we explore these questions and bring clarity to the dynamic landscape of Web3!
1. Overview of Blockchain
Blockchain is a form of shared database distinct from traditional ones, characterized by its method of storing information in cryptographically linked blocks. While blockchains can store various data types, they are most commonly used as ledgers for transactions.
Every blockchain acts as a decentralized ledger, utilizing cryptographic techniques to deliver security, transparency, and diverse functionalities. A significant attribute of decentralized blockchains is their immutability—data once entered cannot be reversed, meaning transactions are permanently logged and accessible to anyone.
Blockchains are primarily associated with cryptocurrencies, where they play a vital role in maintaining a secure and decentralized transaction record. However, their usage is not confined to cryptocurrencies; blockchains can make data immutable across multiple sectors, ensuring it cannot be altered.
Nowadays you can hear about blockchain even in daily discussions, but really how many blockchains are there? How did it start? Well, it all began with Bitcoin’s introduction in 2009. Blockchain uses then have exploded via the creation of various cryptocurrencies, decentralized finance (DeFi) applications, non-fungible tokens (NFTs), and smart contracts.
2. How Many Blockchains Are There?
There are countless blockchain networks today. You might be familiar or at least heard about well-known examples like Bitcoin, BNB Chain, and Ethereum. The blockchain ecosystem is continually evolving as many organizations and projects create their own chains to meet specific demands.
So, how many blockchains are there?
As of 2023, there are more than 1,000 blockchains in use, spanning a variety of industries and applications. These blockchains fall into 4 main categories: private, public, consortium, and permissioned. Each category serves different functions and targets various audiences based on their unique requirements.
3. Use Cases and Applications of Blockchain
In the fast-changing digital world we live in, it’s needed to discover how many blockchains are there, because each provides distinct functionalities and serves different industries, from finance to entertainement. Blockchain technology has become a transformative force, providing innovative solutions to many different industries:
- Cryptocurrencies: Blockchain facilitates secure, decentralized transactions, removing intermediaries. This not only cuts fees but also speeds up processing times, enabling efficient global payments through digital wallets.
- Logistics: Blockchain enhances transparency and traceability within supply chains. It creates an immutable record of transactions, enabling real-time goods tracking and reducing the risk of fraud.
- Gaming: Blockchain is revolutionizing gaming and entertainment by creating NFTs (non-fungible tokens). Among how many blockchains are there, several specialize in unique digital assets like in-game items and collectibles, allowing players to truly own, trade, and monetize their digital possessions.
- Banking: Blockchain technology speeds up cross-border transactions and shortens settlement times. Decentralized finance (DeFi) platforms use blockchain to provide financial services like lending and trading without traditional banks.
- Healthcare: In the healthcare sector, blockchain secures patient data, improving how information is shared and managed. It ensures decentralized, accurate management of medical records. This technology ensures that patient information is decentralized and accurate, highlighting how many blockchains are there that revolutionize data management.
- Other Use Cases: Blockchain is also exploring applications in voting, identity verification, and intellectual property. These emerging uses promise enhanced security and fairness, reducing opportunities for fraud.
As blockchain technology progresses, its diverse applications will likely continue to grow, driving significant innovation. The question now is “How many blockchains are there that worth investing in?”
4. The 4 Main Types of Blockchains
Now that you have an idea of how many blockchains are there, let’s dive into their classifications. Blockchain networks are generally categorized into four main types: public, private, hybrid, and consortium blockchains. Each type offers distinct advantages, limitations, and optimal use cases. Let’s briefly examine each category:
Public Blockchain
How It Works
Public blockchains, like Bitcoin, are foundational to distributed ledger technology (DLT). They address issues related to centralization by decentralizing data storage across a peer-to-peer network. To ensure data authenticity, public blockchains use consensus algorithms, such as Proof of Work (PoW) and Proof of Stake (PoS), where network participants agree on the state of the ledger. These blockchains are permissionless, meaning anyone with internet access can join as an authorized node, mine, and access records. The open-source nature allows anyone to verify transactions and propose changes.
Advantages
Public blockchains are independent of any single organization, allowing them to function as long as there are connected nodes. They offer transparency and security, especially when users adhere to security protocols. Additionally, some blockchains reward users with cryptocurrency for contributing computational power to secure the network.
Disadvantages
Despite the benefits of how many blockchains are there in the public category, these blockchains can be slow, with performance decreasing as more nodes join the network. They are also vulnerable to attacks if hackers control 51% or more of the network’s computing power. Furthermore, companies cannot restrict access or usage, which can be a limitation.
Use Cases
Public blockchains are primarily used for cryptocurrency mining and transactions, such as Bitcoin. They are also suitable for creating immutable records, like electronic notarization and public property ownership records. Organizations valuing transparency and trust, like social support groups or NGOs, benefit from public blockchains. However, private businesses may find these networks less suitable due to their open nature.
Private Blockchain
How It Works
Private blockchains operate within a controlled environment, such as a closed network managed by a single entity. When exploring how many blockchains are there, it’s clear that private blockchains use peer-to-peer connections and decentralization similar to public blockchains but on a smaller scale. Unlike public blockchains, access is restricted, and only authorized nodes can participate. This type is also known as permissioned or enterprise blockchain.
Advantages
Private blockchains allow the controlling organization to set permissions, security levels, and access controls. They can determine which nodes can view, add, or alter data and can prevent external access to sensitive information. Due to their restricted size, private blockchains offer faster transaction processing compared to public blockchains. They can be compared to an intranet in contrast to public blockchains, which resemble the internet.
Disadvantages
Critics argue that private blockchains deviate from the core philosophy of decentralization, which is central to blockchain technology. Trust in the information can be challenging since centralized nodes validate data, and fewer nodes may mean reduced security. Proprietary source codes make independent auditing difficult, potentially leading to security issues. Additionally, private blockchains lack anonymity.
Use Cases
Private blockchains are suited for applications requiring cryptographic security without public access. They are ideal for managing trade secrets, auditing processes, and maintaining competitive advantages. Other common use cases include supply chain management, asset ownership tracking, and internal voting systems.
Hybrid Blockchain
How It Works
Hybrid blockchains integrate features from both private and public blockchains. They allow organizations to manage a private, permission-based system alongside a public, permissionless one. This setup enables selective data visibility; while confidential information remains private within the network, it can be verified when necessary, often via smart contracts. Even though a private entity may own the hybrid blockchain, it cannot alter transactions. Users have full network access but their identities are only revealed during transactions.
Advantages
Hybrid blockchains benefit from enhanced privacy and security because they operate within a controlled environment, protecting against 51% attacks. They also allow for efficient communication with third parties, offer faster transactions, and improve scalability compared to public blockchains. Considering how many blockchains are there, hybrid blockchains offer a balanced approach, combining the benefits of both public and private model.
Disadvantages
One drawback of hybrid blockchains is their lack of complete transparency, as some information remains shielded. Upgrading the system can be complex, and there is typically no incentive for users to actively contribute or participate in the network.
Use Cases
Hybrid blockchains are effective in various scenarios, such as real estate, where they allow private management of systems while publicly displaying information like property listings. Retailers can streamline operations, and regulated industries like financial services benefit from their use. Medical records can be securely stored and accessed through smart contracts, while governments could use hybrid blockchains to protect citizen data and enable secure sharing between institutions.
Consortium Blockchain
How It Works
Consortium blockchains, also known as federated blockchains, blend private and public blockchain features. Unlike a private blockchain controlled by a single entity, a consortium blockchain is managed by multiple organizations. Consensus procedures are handled by predefined nodes within the network, which include a validator node responsible for initiating, receiving, and validating transactions, while member nodes handle transaction processes.
Advantages
Consortium blockchains offer enhanced security, scalability, and efficiency compared to public blockchains. They incorporate access controls similar to private and hybrid blockchains, ensuring that only authorized members participate in the network.
Disadvantages
When diving into how many blockchains are there, it’s important to note that consortium blockchains are less transparent than public blockchains. Security can be compromised if a member node is breached, and internal regulations may limit the network’s functionality and flexibility.
Use Cases
Consortium blockchains are well-suited for banking and payment systems, where multiple banks can collaborate to validate transactions. They are also useful in research organizations and supply chains, especially in the food and medicine sectors, where they can improve trust and transparency in the tracking of goods.
5. The 4 Main Types of Blockchains for Developers
The question “How many blockchains are there?” often arises as businesses and developers explore the potential applications of blockchain technology.Technically, developers often divide blockchains into two main classifications as follows:
- EVM Blockchains: Blockchains that are EVM-compatible can execute Ethereum smart contracts. As a result, developers can write and deploy the same smart contracts on multiple EVM blockchain networks without having to make significant code changes. Some examples of EVM chains are Ethereum, BNB Chain, and Polygon.
- Non-EVM Blockchains: This encompass all other networks that aren’t compatible with EVM. Examples of prominent non-EVM chains include Solana, Polkadot, or Cardano, showcasing the diversity in how many blockchains are there beyond EVM compatibility.
When exploring how many blockchains are there, you should consider that there’s another way to categorize them, which is dividing them into layer-1 (L1) or layer-2 (L2) networks:
- L1 blockchains: these are base networks that serve as the foundation for various applications. Examples include Ethereum, Cardano, Solana, and BNB Chain.
- L2 blockchains: these are network protocols built on top of L1 solutions. These L2 protocols leverage the security infrastructure of L1 networks while offering greater flexibility to scale transaction processing and overall throughput. Examples of L2 blockchains include Polygon, Polygon zkEVM, Arbitrum, Base, and Optimism.
6. Top Popular Blockchain Networks
In exploring how many blockchains are there, it’s essential to look at some of the most popular blockchain networks that have shaped the industry. These networks are key players in the blockchain ecosystem, offering unique features and use cases.
Bitcoin
Bitcoin, the first and most well-known blockchain, revolutionized the concept of digital currency. It introduced the idea of a decentralized ledger, which allows peer-to-peer transactions without intermediaries. Bitcoin remains the most valuable cryptocurrency and is widely recognized for its role in popularizing blockchain technology. Its network is primarily focused on secure and immutable transactions.
Ethereum
When considering how many blockchains are there that support smart contracts, Ethereum stands out as a leader. It introduced a programmable blockchain platform that enables developers to build dApps. Ethereum’s flexibility and robust ecosystem have led to the creation of countless applications in finance, gaming, and supply chain management. Its transition to Ethereum 2.0, which aims to improve scalability and energy efficiency, continues to attract attention.
BNB Chain
Binance Smart Chain (BSC) is another major player in the blockchain space. It was developed by Binance, one of the largest cryptocurrency exchanges in the world. BSC offers fast and low-cost transactions, making it an attractive option for developers and users alike. Its compatibility with Ethereum’s Virtual Machine (EVM) allows for easy migration of Ethereum-based projects to BSC. This adaptability makes BSC a significant component of the answer to how many blockchains are there that support rapid transaction processing.
Tron
Tron is a significant player that are there focused on content creation and decentralized entertainment. They aims to build a decentralized internet by allowing creators to host and share content without relying on centralized platforms like YouTube or Netflix. This is also where our FMCPAY exchange is built on. Its high throughput, scalability, and low transaction fees make it an appealing choice for developers and users in the digital entertainment industry.
Solana
How many blockchains are there that are designed for high speed and low fees? The top of mind must be Solana blockchain. It is gaining recognition for its high-performance blockchain, which supports scalable decentralized applications and crypto-currencies. Solana also utilizes advanced technologies like the Proof-of-History consensus algorithm to efficiently process transactions and manage blockchain growth.
As we explore how many blockchains are there, these networks represent some of the most influential and popular options available. Each offers distinct features that contribute to the diverse and dynamic world of blockchain technology.
Conclusion
As blockchain technology continues to advance and gain traction, understanding how many blockchains are there becomes essential for grasping the full extent of innovation and diversification in this field. Keep following FMCPAY for more expert insights into the crypto world!