Permissioning

Permissioning your Avalanche L1 is an optional feature of having your own L1 blockchain. There may be many reasons why a blockchain creator may want to permission their network including these:

• Privacy and Confidentiality: In industries where data privacy is crucial, such as finance or healthcare, permissioned blockchains allow only authorized parties to access sensitive information. This ensures that confidential data remains protected from unauthorized access.
• Regulatory Compliance: Many industries are subject to strict regulatory requirements regarding data handling and security. Permissioned blockchains enable organizations to implement necessary controls to ensure compliance with regulatory standards without compromising the integrity of the blockchain.
• Cost-efficiency: Restricting the usage of a blockchain to certain use cases may make it more cost efficient. Blockchain operators may be able to avoid transaction fee spikes caused events such as NFT drops by imposing restrictions.

These permissions don't necessarily have to be administered by a centralized entity. There could also be a DAO in charge of determining who should be allowed to use the blockchain.

In the upcoming lessons, you will learn about the different levels of Permissions and how they can be configured for your Avalanche L1.

Time for a Quiz!

Wolfie wants to test your knowledge. Select the correct answer.

What is one of the primary benefits of implementing permissioning on an Avalanche L1 blockchain?

AEnhancing the decentralization by allowing anyone to participate.

BIncreasing transaction speeds by reducing the number of validators.

CEnsuring data privacy and confidentiality by restricting access to authorized parties.

DAutomatically adjusting gas fees based on network demand.

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