It offers a decentralized platform which means that the information is not stored in a central repository and anyone can access the information at any time and from anywhere.
It provides immutable signatures for all records. All the information exchange and transactions are encrypted cryptographically thus, making the entire system safe and data secure.
Anonymity- This is yet another popular feature of the blockchain. The miners and participants in the network remain anonymous.
Transparency is yet another feature of the permissionless blockchain. All the data and information is visible to all. However, this advantage has backfired and people are questioning the security of data in case of the permissionless blockchain.
Quick and easy transactions- Since the permissionless blockchain culminates the need of having a third party, thus there is quick and easy validation and transaction.
Well, certain features of permissionless blockchain have backfired on it and it has turned out to be the biggest question. Here are some of the disadvantages that permissionless blockchain might need to look at, It will help in overcoming the bottlenecks and making the system more reliable and suitable for enterprise solutions:
Anonymity- Although, it’s a good sign that the identity of the trading parties remains anonymous this can again be problematic. In case there is a fraud or someone wants to trace down the parties which are trading, in case of the permissionless blockchain, it becomes difficult. It is because of this features that many people are using blockchain for illicit activities.
Consensus mechanism- the permissionless blockchain like Bitcoin works on the principle of Proof-of-Work where the participants have to solve the complex mathematical puzzle. It requires the consumption of a lot of resources, thus, it’s a costly affair.
Permissionless blockchain offer limited block size.
In the case of the permissionless blockchain, one doesn’t need to prove his/her identity. All you need to do is to commit your processing power to become a part of the network. Any miner who is playing games by the rile and solves the puzzle can become the part of the system.
These drawbacks of the permissionless blockchain system make it a questionable affair for many companies. They believe that it is not suitable for them to make permissionless blockchain a platform for offering enterprise solutions. It is because of these disadvantages that Ethereum which is a permissionless blockchain is shifting its consensus mechanism from proof-of-work to proof-of-stake.