Accessibility and governance are important factors to consider when selecting the right blockchain for your DApp. Broadly, two levels of accessibility are;
And three levels of governance models are
Based on the level of accessibility and governance, you can choose a public, private or federated blockchain network.
As the name suggests, the blockchain is public, and anyone can participate in the network. Anyone can be a user and/or validator for the transactions happening in the blockchain network. If your product expects users and customers from the general public, you can choose a public blockchain.
In a private blockchain, the accessibility is restricted. Only people who are invited can participate in the network. If you want the governance of the network to be tightly restricted, you have to choose a private blockchain. By doing so, only your organization can control the governance of the transactions. This model is suitable if you are launching a private application within your organization.
Federated blockchain, also called consortium or hybrid blockchain, is a type of private blockchain. The difference is that multiple organizations or entities can participate in the transactions' governance. A Federated blockchain is suitable if you build a product that requires cooperation between different companies to execute the business objectives.
Blockchains are essentially shared databases in which every network participant sees what other participants are doing. This mechanism is essential to validate the transactions happening in the network. Another important factor to consider when selecting the right blockchain for your DApp is the level of confidentiality it requires.
Most blockchains offer regular anonymity. The transaction records only show a bunch of wallet addresses and transaction ids. Even though one can see all the transactions happening in the network, it is not easy to identify the people involved in the transaction. However, it is possible to identify the people involved in the transactions using advanced tools and techniques for observing the transaction behaviors and bank transactions.
Certain blockchains offer complete anonymity. Here, a partially encrypted transaction is embedded in a blockchain and proof of its validity without revealing transaction details. Every participant can verify the proof while only seeing the transaction in encrypted form. Most applications do not require advanced anonymity. Consortium blockchain applications with banks as participants may find advanced anonymity useful.
Different blockchain network offers different speed for transactions. The speed is measured in transactions per second (TPS). Depending on the nature of the blockchain application you are building, you can choose the right blockchain that offers the right TPS value suited for your use case.
A normal TPS blockchain is sufficient if you are building apps that process non-financial utility applications. For example, an eCommerce platform with native crypto transactions needs a normal TPS blockchain. Or a blockchain-based voting system. The TPS value can range from 20 to 1000.
For applications that need to process more than 1000 TPS, you must select a blockchain with a high TPS rate. For example, if you are launching a cryptocurrency or social media-based application, you need high TPS blockchains. The TPS value can range from 1000 to 10,000.
For applications that require very high transaction processes per second, you have to go for blockchains that offer such TPS rates. For example, applications linked to IoT devices, high-volume financial transactions, applications linked to the stock market, etc. The TPS value can range from 10,000 to 75,000.
Most blockchains have a transaction fee. The transaction fee is paid by the users participating in the transaction to incentivize the transaction validator. We can broadly classify the blockchains based on the average gas fees in the following three categories.
If you want to offer the users of your application zero or near-zero transaction fees, you can choose this option.
If you want to reward and incentivize the users who validate the transaction in your application, you have to go for a blockchain with low or high Tx fees.
Prominent blockchains such as Ethereum have high transaction fees. But, these blockchains have bigger community support and market penetration. You can select blockchains with high Tx fees and market share if you value market share over transaction fees.
Interoperability allows different blockchains to listen to each other, transfer digital assets and data, and enable better collaboration. There are decentralized cross-chain bridges that facilitate the transfer of data and assets between Ethereum, Bitcoin, EOS, Binance Smart Chain, Litecoin, and other blockchains.
With interoperability, people will be able to do transactions across multiple blockchains. Blockchain Interoperability would lead to multi-token transactions. Such a development will allow users to easily rely on a single wallet system for storage and transfer of tokens across various blockchains.
Most private blockchain applications and consortium blockchain applications do not require interoperability. If you plan to launch a close ecosystem, you do not need interoperability. If you plan to launch an ecosystem that needs to support tokens from other ecosystems or vice versa, you have to choose a blockchain that supports interoperability.
Not all applications that are built using blockchain require a native token. A token or crypto coin is required if your application requires;
A native token is not essential for private blockchain or consortium applications. Moreover, launching a native token unnecessarily can hurt the project if the monetary policies are not properly defined.
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