Hello crypto fam! For those of you who are first time viewers,
I’m Kris from Exodus and you regulars, welcome back. We’re going to take a closer look
at Hedera Hashgraph, and why some people have called it “The Blockchain Killer”.
Let’s break it down, right after this.
If you're not familiar with Hedara Hashgraph it's a little bit different than your typical crypto project.
Hashgraph is an open review consensus algorithm developed in 2016 by Dr Leemon Baird. Hedera is the decentralized public
network and governing council, owned and governed by a global council including Baird’s company
Swirlds Corporation, along with corporations such as Boeing, Deutsche Telekom, Google,
IBM, Tata Communications, LG and more.
Bring them all together and you get Hedera Hashgraph—the only public distributed ledger
in the world that uses the unique Hashgraph algorithm, with its very own native token, HBAR.
HBAR coins are used to power decentralized applications, make payments and to secure Hedera’s
Proof-of-Stake network.
Dr Leemon Baird’s Hashgraph technology is a compelling alternative to blockchain. Some
have even called it the next-generation blockchain. Similar to a blockchain,
Hashgraph is a decentralized and public distributed ledger.
But the way it works differs from blockchain in several ways, and even offers up some vast
improvements.
Hashgraph’s stroke of genius was looking at one of the fastest and most resilient way primitive human
communication has traveled—through gossip. We have all shared spicy news in one way or another
and are often shocked by how fast gossip spreads like wildfire.
In fact, once the word gets out, there’s no way to stop it. Using gossip as a blueprint, Dr Baird
created the gossip-about-gossip protocol behind the hashgraph algorithm, which works like this:
Unlike blockchain,
which has miners sequencing data block after block in a Proof-of-Work protocol, hashgraph uses an
entirely different network architecture or data structure called Directed Acyclic Graph or DAG.
Hashgraph’s DAG is made up of these spherical containers called “events”,
which are gossipped across the network’s nodes, like notes along a musical scale.
Let’s say
we have five nodes on the network: Alice, Bob, Carol, Dave and Ed.
Each node gossips out events to other nodes at random. Each event is a bundle of information
of transaction data along with a timestamp, a signature and two cryptographic messages also
known as hashes. With just those two hashes, the ledger can obtain a complete historical graph of
how the information flowed through the network.
Hashgraph solves all the same problems that a blockchain does, but in a different manner.
Does this mean it is better than Bitcoin or even Ethereum? Let’s look at some of the
differences.
First, speed.
Bitcoin can handle about 7 transactions per second. Ethereum,
the 2nd largest blockchain can handle about 15 transactions per second. Hedera Hashgraph?
At the fastest levels, Hashgraph is able to achieve a blazing speed of 10,000 transactions
per second.
Next, transaction fees.
The average transaction fee of Bitcoin and Ethereumcan be between a few cents to $10 or
more depending on how congested the network is.. Comparatively and because there are no miners to
compensate for their work, Hedera Hashgraph is able to keep its transaction fee to a minimal
$0.0001 in USD, payed in hbars. This fee does not change depending on network demand or usage,
making it stable and attractive for enterprise use and adoption.
And third, security.
Hashgraph has achieved the
highest possible level of security for a consensus algorithm – asynchronous Byzantine Fault Tolerance
(or aBFT).
Hashgraph’s aBFT network is able to achieve consensus with 100% finality by assuming that
messages between honest nodes will be delayed, or never reach their intended recipients,
such as during the case of a malicious attack.
Fast, minimal transaction fees, and a secure network. What more could you ask for? Hedera also doesn’t require energy-heavy Proof-of-Work
resources. For diversity and stability, Hedera is governed and backed by a global council of 39
term-limited organizations and blue-chip enterprises representing
18 industries around the world, including Australia, Japan, Europe, South America and India.
The potential applications of Hashgraph,
like blockchain, are infinite. From settling micropayments to music and intellectual property,
supply chain management, decentralized advertising, sovereign identity, decentralized
finance, the Internet-of-Things and this is just scratching the surface.
Currently, there are more than 300 decentralized applications being
built on the Hashgraph platform, including the digital healthcare platform Safe Health Systems,
Inc. that’s used by over 150,000 users at Delta, Arizona State University, and The Coupon Bureau,
an industry-managed platform whos advisory committee includes the likes of Target,
General Mills, GS1 and others.
If you didn't know anything about Hedera before, now you do so, what do you think? Is Hedera Hashgraph a threat waiting to usurp blockchain from its throne?
Click the link above and pop on over to the Exodus blog to take a deeper look at Hedera Hashgraph.
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Until next time, HODL on!