Do you know what Consortium Blockchain means?

Consortium Blockchain

Definition: A consortium blockchain is a type of blockchain where the consensus process is controlled by a pre-selected set of nodes or entities; for instance, a consortium of companies or representatives from different organizations. It falls between the fully open, decentralized nature of public blockchains and the singular control point of private blockchains.

Key Points:

  • Selective Decentralization: While consortium blockchains are decentralized, they are not as decentralized as public blockchains. They offer a middle-ground solution where only a few trusted entities can validate transactions.
  • Access Control: The rights to read and write data on a consortium blockchain might vary among participants. Some participants may only be allowed to access and verify transactions, while others might have permission to initiate transactions.
  • Trustworthiness: Since participants are known and vetted, consortium blockchains can operate with a reduced level of trust compared to public blockchains. This makes them more suitable for business-to-business use cases.


  • Efficiency: Faster transaction times and increased scalability compared to public blockchains due to reduced participation in the consensus process.
  • Privacy: Offers a higher level of privacy compared to public blockchains while still maintaining transparency among consortium members.
  • Control: Participants can decide on the rules, governance structure, and other essential parameters of the network.
  • Reduced Risk: Malicious attacks are less likely given the more restricted and controlled nature of the network.


  • Centralization: More centralized than public blockchains, which could be a point of vulnerability or control.
  • Interoperability: Consortium blockchains may face challenges interacting with other blockchains or systems.

Use Cases:

  • Supply Chain: Different entities within a supply chain can track and authenticate products without giving full transparency to the public.
  • Banking and Finance: A consortium of banks can process and settle transactions more efficiently without exposing sensitive data.
  • Healthcare: Hospitals, clinics, and other stakeholders can securely and transparently share patient data.


  • R3 Corda: A blockchain platform designed for the financial industry.
  • Hyperledger Fabric: An open-source consortium blockchain project hosted by The Linux Foundation and designed for use in enterprise settings.

Related Terms:

  • Public Blockchain: A fully decentralized blockchain where anyone can join and participate in the consensus process, like Bitcoin or Ethereum.
  • Private Blockchain: A blockchain where write permissions are centralized to one organization.

In summary, consortium blockchains provide an intermediate solution between public and private blockchains. They offer a balance of control, transparency, and privacy, making them suitable for business collaborations where participants want to share data without exposing it to the broader public.

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