Can a Blockchain Exist Without Bitcoin?

Among crypto users, there’s a widespread idea that blockchain was built upon Bitcoin and therefore is inextricably connected to it. However, as the mainstream understanding of both these concepts grows, the public has become aware that this isn’t always the case. 

A blockchain can exist without bitcoin. While public blockchains often need the cryptocurrency to function properly, their private counterparts don’t. Cryptocurrencies are built upon blockchain technology, not the other way around.

In this article, I’ll take you through how and when blockchains are able to function without Bitcoin, when they need the cryptocurrency, and delve into some additional information that can help you understand the concept much better as a whole.

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How Blockchains Can Exist Without Bitcoin

As you might have gathered by now, the theory that blockchains were built upon Bitcoin’s technology doesn’t hold much weight. In reality, it’s the other way around

Bitcoin and other similar types of crypto were created and still continue to operate using the service’s technology. In simpler terms, Bitcoin is to blockchain what Google is to the internet: an important but small part of the system that uses its technology to function. 

Additionally, we’ve been so consumed by the focus on blockchain as the technology behind Bitcoin that we often forget that, in reality, it’s much more than that. Blockchain has a wide range of uses that go beyond the crypto industry

However, the two are still connected, as blockchain serves as a digital record that divides its information into segments, otherwise known as blocks. This approach provides a secure way to keep digital records, which is crucial for cryptocurrency users. Unlike traditional record-keeping, blockchains are virtually impossible to hack into and unaffected by power outages.

Private blockchains that don’t rely on Bitcoin already exist, with Dogecoin and Litecoin being two of the most commonly known examples. These cryptocurrencies also depend on the blockchain’s technology, but they use limited tokens that don’t have any connection to traditional Bitcoin.

There are two widely used types of blockchains: public and private. Permissioned blockchains are also gaining popularity among enthusiasts, but I’ll stick to the two most commonly preferred options for the sake of argument. You’ll learn more about their differences and the nature of their relation to bitcoin in the following sections.

Private Blockchains

Private blockchains are invitation-only networks that exercise a level of control over the number of participants they accept and the actions these members can take. Private blockchains are usually more centralized, as there’s always an entity that has the right to edit the entries made by participants.

Therefore, your ability to make currency transactions on a private blockchain is limited, as any action request won’t go through immediately. This is because new blocks need to be validated before they can be added to the chain.

Public Blockchains

One of the most distinctive features of a public blockchain is the fact that it’s immutable. This is something all crypto users will need to consider before taking action, as blocks can’t be altered after they’ve been verified.

Additionally, in contrast to their private counterpart, public blockchains can’t exist without Bitcoin. The cryptocurrency is the embodiment of this technology, as it’s created in a way that allows everyone interested to join. 

Every miner or user can read and take part in the ongoing activities of the network. For this reason, the nature of these blockchains is much more decentralized, giving their users the freedom to self-govern.

These networks rely on the attraction of new participants to remain profitable. They’re the only truly authority-free blockchain you’ll find and are based upon the core concepts of democracy.

However, this level of self-governance also comes with its drawbacks. These public ledgers require significant effort to operate and be maintained. Additionally, while private blockchains offer an impressive level of anonymity and privacy, you can’t expect the same when it comes to their public counterparts. Once a transaction is recorded, it’ll be viewable by anyone using the same network.

Moreover, the same transactional freedom that allows you to effortlessly operate within the network also allows hackers and thieves to get away with fraudulent activity much more easily. 

As mentioned, although technically the technology is still usable without crypto, Bitcoin is the whole reason miners are interested in using it in the first place. Therefore, even though the currency isn’t necessary when it comes to the technology’s functioning, its use as a reward for miners makes it essential. Otherwise, the incentive to use blockchain would be gone.

Why Can’t Public Blockchains Exist Without Bitcoin?

As you’ve probably gathered by now, blockchain, being the technology upon which Bitcoin is based, can technically always exist without it. However, in practice, there are some instances in which a blockchain without Bitcoin is rendered useless.

Public blockchains can’t exist without bitcoin because the cryptocurrency is the driving force that makes them usable by miners. These blockchains use Bitcoin as a reward to their users, which would otherwise have no incentive of joining the system in the first place.

The purpose of a public blockchain is to gather and record as many transactions as possible. By using bitcoin as their currency of choice, they attract an increasing amount of interest, which leads to more substantial computer power being deployed on the service.

The importance of Bitcoin when it comes to public blockchains has been already verified, as back when the system was operating on a virtually worthless cryptocurrency, the computing power created by it was inconsequential. 

As Bitcoin experienced its rise in value, the blocks created gained value as well, attracting more miners, and starting a cycle that allows them to operate and create new value over time.

In short, although blockchains can exist without Bitcoin (some of them already do), it’s not always practical to separate the two. By doing so, you’ll be leaving the network much more vulnerable and difficult to operate, as significant investments would need to be made in order to sustain the remarkable amount of records being kept by these systems.

What Are Blockchains?

If you’re still unclear regarding the sometimes confusing link between blockchains and Bitcoin, understanding these concepts better might help you not only grasp their connection more clearly but also form your own viewpoints regarding its necessity. 

Blockchains are shared databases that store information in blocks, which are linked together through a cryptographic network. Blockchains are the technology upon which many types of cryptocurrencies, including Bitcoin, are based.

The networks blockchains use to store digital information are crucial in the functioning of cryptocurrencies. They’re the only way to ensure secure records of every crypto transaction happening in real-time.

The way they collect and store their data (in blocks) is the element that separates them from traditional databases. This structural approach is characterized by its irreversibility. When a block is filled with information, a new one is created, creating a chain that, once verified, can’t be undone. This means that the data kept in these networks are linked together in chronological order.

Conclusion

Blockchains can exist without Bitcoin, and this is especially true for private networks. A blockchain represents the technology upon which a cryptocurrency functions, and as such, it doesn’t require the latter to exist.

However, even though there have been some cases in which blockchain networks and Bitcoin have been successfully separated, it’s not always practical to do so. Public ledger networks are the perfect example of this. In these cases, even though the technology can technically operate without the cryptocurrency, it serves no functional purpose and, therefore, is rendered useless.

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