Private, Enterprise Blockchains 'Make No Sense' and Are Set to Fail: Abra CEO

The idea of private blockchains, such as enterprise blockchain platforms, will eventually "Fail miserably," the CEO of Abra said during Fortune's "Balancing The Ledger" show on Feb. 25.

Bill Barhydt, CEO of cryptocurrency wallet and investing app Abra, has argued that the idea of a truly decentralized cryptocurrency contradicts the notion of private blockchains.

Unlike public blockchains, such as those of Bitcoin and Ethereum, which can be accessed and joined by anyone, private blockchains represent a permissioned network with access controls that restrict who can join, meaning that they operate like centralized database system.

Speaking during the show, Barhydt compared enterprise blockchain solutions with the concept of an extranet, a term for a local network protocol that was popular in the 1990s.

An extranet represents a controlled private network that only allows access to an authorized set of customers.

Abra's CEO argued that the extranet phenomenon is "Exactly what's happened with all this enterprise blockchain nonsense."

"People have this fallacy idea that they're going to make blockchain work inside the firewall It's all going to fail miserably It's all about a truly decentralized cryptocurrency and a private blockchain it just makes no sense."

Barhydt's stance echoes previous statements by Bitcoin developer and Blockchain Capital venture partner, Jimmy Song.

In June 2018, Song stated that using blockchain technology for a private and centralized system, such as an enterprise, "Makes zero sense."

Barhydt also stated that "If it really is a private blockchain and private coin, I'm guessing it's a complete waste of time."