What is Hybrid Blockchain?

Hybrid Blockchain

A unique form of blockchain technology called a hybrid blockchain combines the most significant features of both worlds. Organizations that are unsure about the differences between public and private blockchains choose hybrid blockchains to handle their data storage needs. It enables organizations to develop a private, permissioned system and a public, permissionless one. In a hybrid blockchain, records and transactions are private but can still be verified as necessary by providing access via a smart contract. Personal information can still be validated even when it is stored inside the network. When people sign up, the entire network is accessible to them. However, other users cannot access the user’s identity unless they participate in a transaction. The other party is then made aware of who they are. We will go through the following aspects of hybrid blockchain in the following paragraphs.

  • Understanding Blockchain Technology
  • Working of Hybrid Blockchain
  • Uses in the real world 
  • Benefits and Key Features
  • Disadvantages
  • Current Hybrid Blockchain
  • Impact on Various Industries

Understanding Blockchain Technology

Blockchain is a decentralized, immutable database that makes it easier to track assets and record transactions in a corporate network. An asset may be physical (such as a home, car, money, or land) or intangible (intellectual property, patents, copyrights, and brands). On a blockchain network, practically anything of value may be recorded and traded, lowering risk and increasing efficiency for all parties.


Blockchain facilitates the verification and traceability of multi-step transactions that require such functions. It can speed up data transfer procedures, offer secure transactions, and lower compliance expenses. Blockchain technology can facilitate contract management and verify a product’s provenance. In addition, it manages titles, deeds, and voting platforms.

Working of Hybrid Blockchain

In essence, a hybrid blockchain has two interfaces: a public blockchain that helps with data verification between the private blockchain’s ledgers and a private blockchain with its ledgers. In this section, we’ll go over some of the aspects of hybrid blockchains, which incorporate the benefits of both public and private blockchains. The major drawback of a public blockchain is that the transactions kept in the ledger are not sufficiently secure. On the other hand, a private blockchain does not have this issue. As a result, a hybrid blockchain offers total data security. In addition, this sort of blockchain’s access to participants is more decentralized, which is another feature. A hybrid blockchain allows for decentralization when and where it is needed because public and private blockchains cater to it differently.

Hybrid blockchains are the solution for businesses unaware of the distinctions between public and private blockchains for data storage. It enables organizations to develop a private, permissioned, and public, permissionless system. In a hybrid blockchain, records and transactions are private but can still be verified as necessary, for instance, by providing access via a smart contract. Personal information can still be validated even when stored inside the network. When people sign up, the entire network is accessible to them. Unless they take part in a transaction, other users cannot access the user’s identity. 

Uses of Hybrid Blockchain in the Real World


The use of blockchain in government could evolve. Governments are aware of this and have begun implementing blockchain technology. A government can use blockchain to give social and humanitarian relief, conduct elections, create public identification databases, store sophisticated data, do financial analysis, and more. While providing the required control to the government, it allows for public access. Blockchains that are entirely private or available to the general public are useless because they either limit user access or reveal too much information. The government can maintain control over the blockchain as long as it is appropriately governed.

Banking Industry

A hybrid blockchain could be the ideal solution for the banking industry. Because it must protect consumer information while resolving difficulties internally, banks may utilize this tactic. Even the more specialized centralized cryptocurrency, Ripple, has the ability to transition to a hybrid blockchain network when required.

Corporate Ownership Registries

According to World Economic Forum (WEF), businesses that run covertly offer opportunities for money laundering, selling influence, and influencing government investments. Central registers can be created using blockchain technology to track conflicts of interest and criminal activities. Additionally, it might offer openness and disclosure. However, there are several restrictions because most nations do not mandate that businesses keep track of their beneficial ownership information. Additionally, a blockchain-based registry would need the support of major companies, banks, attorneys, and politicians, which could be problematic in some places.

Benefits and Key Features of a Hybrid Blockchain

Low cost

A hybrid blockchain generates more scalability than a public blockchain network and allows for quick and inexpensive transactions. In addition, they are affordable because only a few nodes are needed to verify transactions on the hybrid blockchain.

Protection and Privacy

A hybrid blockchain permits communication with outside parties while preserving anonymity. Furthermore, since hybrid blockchain functions in a closed ecosystem, the network cannot be subjected to a 51% attack from outsiders.

Freedom of Choice

Members of the hybrid Blockchain can select the blockchain’s users or decide which transactions should be made public. This ensures that a business can successfully manage its shareholders.

Changes the Rules When Needed

Businesses benefit from the change. The good thing about hybrid blockchain is that new rules are implemented. However, the goal of the hybrid blockchain will determine the type of modification. For example, if a hybrid system manages band registry or user identity for verification purposes, don’t anticipate changing data or modifying transactions in that system.

Key Feature of Hybrid Blockchain

Public anonymity is still preserved even though the hybrid blockchain has restricted anonymity for the users who participate in the network. No one outside the network will ever be aware of the users. The moment at which the public and private systems converge is fascinating.

The hybrid network has all the essential characteristics of a public blockchain, such as security, transparency, and decentralization. But it also restricts who can view or modify transactions. Additionally, the network is limited to certain users. This prevents the leak of sensitive data. Hybrid Blockchain, which combines both aspects, promotes increased security as a result.


It’s true that by combining public and private blockchains, a company can benefit from the advantages that each brings individually. 

Despite all of these benefits, hybrid blockchains have certain disadvantages. For example, they lack some of the openness of other blockchains and do not allow businesses to go through the lengthy and complicated adoption process. However, there are still helpful use cases in retail, real estate, and other industries subject to strict rules.

Current Hybrid Blockchain

The first hybrid blockchain, and the only one at the moment, is XinFin. It is constructed using the private blockchain Quorum and the public blockchain Ethereum. J.P. Morgan of the Enterprise Ethereum Alliance created Quorum, an enterprise-focused version of Ethereum.

Their hybrid network utilizes smart contracts and IoT on top of a delegated proof-of-stake consensus (DPoS) amongst trusted master nodes. This makes it possible to submit real-time data to the blockchain. XinFin is still in its infancy. Despite this, they have finished over a dozen pilot projects in supply chain logistics, aviation, human resources, payroll, and financial settlements. In order to provide its hybrid blockchain solutions for its customers, XinFin teamed with Ramco Systems, a $1 billion worldwide enterprise software company.

Impacts on various Industries

Cyber Security

Cyberattacks used to pose a severe threat to the general public. Numerous groups were working on appropriate solutions to protect the data from unwanted access and manipulation. Due to peer-to-peer connections that prevent data from being altered, blockchain instantly detects harmful attacks. A cryptographic technique is used to verify and encrypt every data saved on the blockchain network. Blockchain offers a transparent and safe method of recording transactions by doing away with the centralized system (without disclosing your private information to anyone). For instance, the software security firm Guardtime provides blockchain-based goods and services. The business uses blockchain technology and disperses data among its nodes rather than adhering to the centralized structure.

Supply Chain Management

Due to this lack of openness, supply chain management frequently encounters issues such as service redundancy, inadequate departmental cooperation, and unreliability. Blockchain technology enables traceability across the supply chain, making it easy to track things. In addition, blockchain enables the supply chain management system’s many parties in the supply chain to audit and verify transactions.

In a decentralized distributed ledger, blockchain keeps track of transactions (including a product’s history, timestamp, and date). Each transaction is recorded in a block. As a result, anyone can use blockchain to examine a product’s authenticity or delivery status.


Patients can link to other hospitals in the healthcare system and promptly gather their medical data. In addition to the delay, since the data is in a physical memory system, there is a high risk of data corruption. Since there is no central authority with blockchain, data is immediately accessible.

Each block in this structure is connected to every other block and dispersed throughout the computer node. As a result, this becomes difficult for a hacker to corrupt the data.

For example, United Healthcare is an American healthcare company that has enhanced its privacy, security, and medical records’ interoperability using blockchain.


A blockchain, whether public or private, cannot resolve every issue. For businesses and organizations who want to use blockchain technology but don’t want to reveal their sensitive company information and procedures to the public!


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