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Crypto Glossary/Permissioned Ledger

Permissioned Ledger

A permissioned ledger is a restricted blockchain network used in enterprise settings for privacy, scalability, and control. It requires permission to join and interact with the network, offering advantages such

TLDR - Permissioned Ledger

A permissioned ledger is a type of blockchain network where access to the network and participation in the consensus process is restricted to a specific group of participants. Unlike public blockchains, permissioned ledgers are not open to anyone and require permission to join and interact with the network. This type of blockchain is often used in enterprise settings where privacy, scalability, and control are important considerations.


A permissioned ledger, also known as a private or consortium blockchain, is a distributed ledger technology (DLT) that restricts access and participation to a predefined group of participants. Unlike public blockchains like Bitcoin or Ethereum, where anyone can join the network and participate in the consensus process, permissioned ledgers are designed for specific use cases and require permission to access and interact with the network.

Permissioned ledgers offer several advantages over public blockchains, including enhanced privacy, scalability, and control. By limiting access to a select group of participants, permissioned ledgers can ensure that sensitive information remains confidential and only accessible to authorized parties. Additionally, permissioned ledgers can achieve higher transaction throughput and faster confirmation times compared to public blockchains, as they do not face the same scalability challenges associated with open networks.

Key Features

Access Control

One of the defining features of permissioned ledgers is the ability to control who can join the network and participate in the consensus process. Access control mechanisms are implemented to ensure that only authorized participants can interact with the ledger. This allows organizations to maintain control over their data and restrict access to sensitive information.

Identity Management

Permissioned ledgers often incorporate identity management systems to verify the identity of participants. This ensures that only trusted entities can join the network and perform transactions. Identity management systems can range from simple username and password combinations to more sophisticated mechanisms such as digital signatures or multi-factor authentication.

Consensus Mechanisms

Permissioned ledgers typically use consensus mechanisms that are more efficient and less resource-intensive compared to the proof-of-work (PoW) consensus used in public blockchains. Popular consensus mechanisms in permissioned ledgers include practical Byzantine fault tolerance (PBFT), proof-of-stake (PoS), and delegated proof-of-stake (DPoS). These consensus algorithms allow for faster transaction confirmation and higher throughput, making permissioned ledgers suitable for enterprise applications.

Privacy and Confidentiality

Privacy and confidentiality are crucial considerations in permissioned ledgers. Since access to the network is restricted, participants can transact and share data without exposing it to the public. This is particularly important for businesses that deal with sensitive information or require compliance with data protection regulations. Permissioned ledgers often employ encryption techniques and access controls to ensure that only authorized participants can view and access specific data.

Governance and Control

Permissioned ledgers provide organizations with greater control over the network and its rules. Participants in a permissioned ledger typically have a say in the governance and decision-making processes, allowing them to collectively determine the rules and policies that govern the network. This level of control is essential for enterprises that need to comply with industry regulations or internal governance requirements.

Use Cases

Permissioned ledgers find applications in various industries and use cases where privacy, scalability, and control are paramount. Some common use cases include:

Supply Chain Management

Permissioned ledgers can be used to track and trace goods throughout the supply chain, ensuring transparency and accountability. By restricting access to authorized participants, businesses can securely share information about the origin, movement, and condition of goods without exposing sensitive data to the public.

Financial Services

Financial institutions often utilize permissioned ledgers to facilitate secure and efficient transactions. By restricting access to trusted participants, permissioned ledgers can enable faster settlement times, reduce fraud, and enhance regulatory compliance.


Permissioned ledgers can be employed in healthcare to securely store and share patient data among authorized healthcare providers. This allows for improved interoperability, data integrity, and patient privacy.

Government and Public Sector

Government agencies can leverage permissioned ledgers to enhance transparency, streamline administrative processes, and improve public service delivery. By restricting access to authorized entities, governments can ensure the integrity and security of sensitive data.


Permissioned ledgers offer a more controlled and private approach to blockchain technology. By restricting access to a select group of participants, permissioned ledgers provide enhanced privacy, scalability, and control compared to public blockchains. These features make permissioned ledgers well-suited for enterprise applications where data confidentiality and compliance with regulations are critical.

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