What is Consortium Blockchain? | CryptoWallet.com

What is Consortium Blockchain?

A consortium blockchain is a type of private blockchain that only shares information with a specified group or consortium of members. They are also called federated blockchains because they can only be accessed by a federation of members or companies. 

This is as opposed to a public blockchain like Bitcoin which can be accessed by anyone, or a private blockchain that is only available to one select company. Consortium blockchains are often shared between several companies or organizations that have membership.

Why would you need a consortium blockchain? 

Consortium blockchains offer a degree of higher transparency and openness than a traditional private blockchain, since they can be verified by multiple participating parties and not within just one organization.  They allow different organizations to collaborate and share information between themselves. 

However, consortium blockchains are also more private than public blockchains since they are only available to members and not to the broader public. 

In addition a consortium blockchain is generally more efficient than a public blockchain since it does rely on some degree of centralization.

Consortium blockchain example:

An example of a consortium blockchain would be one that allows various competing banks within a specific region to have access to and the ability to alter the same information on a blockchain.