Hedera Hashgraph is the project responsible (patented) for the “gossip about gossip” protocol, a new method of recording financial transactions in a decentralized manner. It is ten times faster than the blockchain in record keeping, and many will agree that it consumes less energy, leaving almost no effect on the ecosystem.
The network was developed as an improved alternative, a successor to Bitcoin’s decentralized interoperability and Ethereum’s programmability. It does not apply the blockchain method of recording transactions. This consumes less space because there are no blocks to be interlinked.
Instead, the nodes on the network process and calculate (through a consensus mechanism) the total transactions and records them as hashes, then dispense the information to every other node for a unanimous agreement. Hedera is not your typical cryptocurrency. It has been around since 2016 and has survived the infamous crypto winter, making it a potentially good investment.
What is Hedera Hashgraph?
In its simplest form, Hedera Hashgraph is a platform used to create decentralized applications by small and large entities.
This project uses a new and somewhat unique technology to secure its network and accelerate transactions. It has an impressive transfer speed of 10000 transactions per hour, with each piece of data recorded within 3 seconds.
However, it is also essential to break the concept of Hedera Hashgraph into two. The first is the project itself, while the other is the mechanism employed by the network, otherwise known as “Hashgraph,” the first and only of its kind.
A Hashgraph is a publicly distributed ledger that uses a different type of consensus mechanism than other cryptocurrency networks. It adopts a proof-of-stake technique but with modifications, especially for the Hedera network.
This new method eliminates delay, security breaches, and massive energy consumption. It also improves scalability and the cost of each transaction, making bulk and minor exchanges more affordable.
In a nutshell, it is a consensus algorithm that uses nodes to validate the efficacy of other nodes. So, in a way, they check each other by spreading “gossip” that every other node must confirm.
This method works because of factors like a digital signature, timestamp, and cryptographic hashes. These mechanisms ensure that the gossip technique, which is one of a kind, remains failproof. It uses the asynchronous Byzantine Fault-Tolerant consensus algorithm, otherwise known as aBFT.
It is the most secure option among popular cryptocurrency consensus algorithms, and it is premised on the assumption that a malicious attacker cannot control more than one-third of the nodes.
The network is failproof because the other nodes are expected to remain honest, and any message gossiped from one honest node to another will eventually come through and be detected for recording.
Hashgraph technology uses timestamps, which are time-based evidence of the time the transaction was completed, and this information comes from every node in the system. There is also a feature called the transaction order.
Here. Transactions are arranged in terms of the time they were recorded. This improves transparency, efficiency, speed, and better record-keeping.
As mentioned already, factors like the timestamp and digital signature are evidence of the honesty of the nodes. The aBFT mechanism reinforces the security needed to detect the infiltrating party. But no development can unveil them because of the anonymity of users generally in the crypto space.
Like every other crypto project, Hedera Hashgraph can be used to facilitate exchanges, engage in smart contracts, and build apps.
The glory of it, which was briefly mentioned before, is that it requires less data because the information is not stored in eternally linked blocks of records like the blockchain has been modeled after. New cryptocurrencies are created with systems that run on different and improved validating technologies, but even fewer have yet to develop alternate tech that maintains anonymity, distributes money seamlessly and quickly, and remains decentralized.
Hedera Hashgraph is one of them, and she boasts of speed, security, and stability improvements. The method of storing data is different and consumes less space. The nodes create a directed acyclic graph. As you will expect of most finance tech companies, graphs are the go-to system for securing funds.
In this case, the algorithm of nodes works with vertices and edges directed to continuously never create a closed loop. Another characteristic of this type of graph is its topological arrangement.
An algorithm also calculates the shared state after the nodes have calculated every transaction in a particular round. That is the stored data, and it is supposedly less storage space required. Every node knows the number of nodes in a transactional round, and they calculate the data necessary based on a consensus strategy.
In contrast to the blockchain, Hashgraph consensus mechanisms calculate data in an interloping manner, meaning the sum of one transaction is added to the next round, and on and on it goes.
Low carbon emissions are also an advantage of this method of reasoning. It is built on the proof-of-stake mechanism but also uses a different algorithm, the Hashgraph algorithm. Hedera Hashgraph does not use plenty of space for records like most cryptocurrencies that use blockchain technology, but staking is a way to confirm the honesty of nodes.
Who launched Hedera Hashgraph
Dr. Leemon Baird and Mance Harmon launched Hedera Hashgraph. However, the governing body may be more attractive to you. According to the project’s whitepaper, Google has a leading role in ruling the decentralized finance project. Other names you may be familiar with are Boeing, Chainlink Labs, LG, and IBM.
The duty of the governing body is to oversee software updates, network pricing, and manage funds. Apparently, the governing council of the Hedera Hashgraph does not receive profit from the money raised by the project.
In the cryptocurrency sphere, we do not mention the governing bodies because there is a principle that projects generally tailor themselves after. The governing body is usually decentralized and accommodative of every user who desires to contribute. But Hedera Hashgraph also adopts a different strategy in this area.
The native cryptocurrency of Hedera Hashgraph is HBAR, and you need it for every transaction or activity you participate in on the ecosystem.
In a nutshell, Hedera Hashgraph revolves around decentralized ledger technology. This technique also adopts a different strategy in securing funds while ensuring efficiency in record keeping.