Public chains are great because you can have consensus without knowing who everybody is , and you eliminate couterparty risk because the onchain ledger is the asset itself . You don ' t have to worry that somebody doesn ' t really have the ether they claim to have . A private chain makes sense when 1 You have a group of cooperating businesses , and you don ' t want to trustpay any one of them to maintain a database for the whole group . Since you know who everybody is , you can use traditional consensus mechanisms which are much faster , cheaper , and more scalable than anything currently running on public chains . 2 You ' re tracking offchain assets like dollars and securities , so you can ' t get away from counterparty risk anyway . And in this situation you probably aren ' t interest in dealing with a new asset on chain , like ether .