The concept of permissioned distributed ledgers is fundamentally different to a public blockchain.
The key idea behind distributed ledgers is that they are permissioned as opposed to an open public blockchain.
A Complete Guide to Understanding This Blockchain Concept (Part 2)
DLTs do not perform any mining as all the participants are already vetted and known to the network and there is no requirement for mining to secure the network.
There is also no concept of digital currency on private permissioned distributed ledgers because the aim of the permissioned blockchain is different from a public blockchain.
In a public blockchain, access is open to everyone and requires some form of incentive and network effect in order to grow; on the contrary, in permissioned DLTs, there are no such requirements.
It is possible to build permissioned DLTs using Ethereum in private consortium settings, especially to work within existing financial systems.
The key benefit of distributed ledger systems is that they are much faster, governable, and possibly interoperable with the existing financial system.
Why This Matters for Blockchain Technology
Understanding Distributed ledgers is not just an academic exercise — it has real-world implications for how blockchain systems are designed, deployed, and secured. Whether you are a developer building decentralized applications, a business leader evaluating blockchain adoption, or a curious learner exploring the technology, this knowledge provides a critical foundation.
Key Points to Remember
- Distributed ledgers The concept of permissioned distributed ledgers is fundamentally different to a public blockchain.
- The key idea behind distributed ledgers is that they are permissioned as opposed to an open public blockchain.
- DLTs do not perform any mining as all the participants are already vetted and known to the network and there is no requirement for mining to secure the network.
- There is also no concept of digital currency on private permissioned distributed ledgers because the aim of the permissioned blockchain is different from a public blockchain.
Conclusion
Distributed ledgers represents one of the many innovative layers that make blockchain technology so powerful and transformative. As distributed systems continue to evolve, a solid understanding of these core concepts becomes increasingly valuable — not just for developers, but for anyone building, investing in, or working alongside blockchain-powered systems.
Whether you are just starting your blockchain journey or deepening existing expertise, mastering these fundamentals gives you the tools to think clearly about decentralized systems and make smarter decisions in this rapidly evolving space.