What is Hedera Hashgraph? (HBAR)and How Does Hedera Hashgraph Work?
Hedera Hashgraph is a cryptocurrency network seeking to serve as a platform on which anyone can transact and deploy applications, but where a group of businesses oversee the software.
Toward this goal, Hedera makes notable design trade-offs differentiating it from other platforms. For example, the network supports high transaction speeds for its HBAR cryptocurrency, but allows only approved nodes to participate in determining transaction history.
By restricting the number of nodes involved in key functions like timestamping and transaction ordering, Hedera Hashgraph is able to quickly achieve finality, reducing the likelihood changes to the state of transactions might later be made.
The Hedera team argues this gives businesses a needed guarantee, as they can be confident when making decisions based on this data.
As of 2020, there appears to be traction for the idea, as the model has succeeded in attracting dozens of big companies such as LG, IBM and Boeing to act as nodes within the network.
For more information on the project, you can bookmark its official blog, which includes updates on the status of its network and evolving technology.
How Does Hedera Hashgraph Work?
Hedera Hashgraph’s most unique feature is its data structure for grouping transactions called a hashgraph, which claims to process more transactions more cheaply than existing blockchains.
The Hashgraph is a patented algorithm where all nodes are constantly communicating their information with each other, and was originally designed for private use.
The Hedera Hashgraph is the first iteration of the algorithm that is used in a public network.
Hashgraph Consensus Service
To ensure all the computers in its distributed network agree on its transaction history, Hedera Hashgraph uses the Hashgraph consensus mechanism, powered by two types of nodes.
Consensus nodes determine transaction ordering and history, while mirror nodes relay this information to other stakeholders throughout the network.
By using a limited number of nodes to determine its history, the Hedera model ensures that the transactions won’t later be undone. This differs from how most traditional blockchains achieve consensus, in which the state of the blockchain is determined by users who propose blocks to be added to the chain in a market competition open to anyone.
As a result, Hedera Hashgraph claims to offer features that combine the advantages of both public and private blockchain networks.
Hedera Governance
Hedera Hashgraph is governed by a body known as the Hedera Governing Council, which is charged with running the consensus nodes that determine transaction ordering.
As of 2020, a total of 39 members sit on the council, including Google, IBM and Boeing. The council’s role is to manage the software, voting on changes, ensuring funds are allocated correctly and safeguarding the network’s legal status in various jurisdictions.
Of note is that space on the council is limited. Each member can have up to two consecutive three-year maximum terms. During this time, members have an equal vote on the network and platform decisions.
While the Governing Council members run mainnet nodes today, the Hedera team intends to open that up to anyone who wishes to operate nodes in the future.
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