Hashgraph Technology Could Replace the Blockchain

Blockchain, News | August 14, 2022 By:

Probably the most significant technological advancement in this era is the development of blockchain technology. It has offered many solutions to the challenges of traditional databases, with decentralization, transparency, and a high level of security among its best characteristics. Its existence has been implemented into practically all business sectors and has made a significant impact. As a result, the global Blockchain technology market was valued at just under $6 billion in 2021 and is projected to reach more than $60 billion by 2026. 

Even those who keep up with MLB odds online will search various places to ensure they get the best value. It’s similar to the distributed ledger technology (DLT) sector, where another technology called Hedera Hashgraph entered the market. 

What is Hashgraph?

Because it relies only on the peer-to-peer network model, DLT, like blockchain, allows businesses to take advantage of the extra computing power more than ever. Although it unlocked many opportunities that weren’t possible using a conventional system, there are still some issues that make people wonder if maybe a better solution exists. 

Hedera Hashgraph is an algorithm for data and consensus which works on Graph structures to create faster, more secure applications. It uses concepts such as “gossip about gossip” and “virtual voting” to achieve these transactions and also overcome the gaps typically left by blockchain. 

Gossip is the term for transferring info from one node to another random node to make sure data has been shared among all network members. When gossip about gossip is used, it makes virtual voting possible because each node can predict how the other node will vote, resulting in virtual voting.  

How Do They Compare?

Both technologies have their benefits and their drawbacks. As more investigation and understanding of the two come to light, the next generation of netizens will determine if one prevails over the other.

Patented or Open-Source

Because blockchain technology is open-source, there are many contributors when building cryptos and utility tokens. Because so many individuals are using and editing the codes, users could find a chain today that will be completely different the next day. This is not the case with Hashgraph. It’s based on an algorithm patented and owned by Swirlds, which is the Hedera Governing Council. This allows developers to avoid unlawful activities such as forking and eventually approves more stable chains. 

Transaction Speed

The gossip about gossip protocol used by Hashgraph enables it to provide faster transactions than blockchain because less information is needed to interact with more events. As a result, Hashgraph can deliver about 500,000 transactions per second. In comparison, the speed of Blockchain transactions depends on protocols like Hyperledger and Blockchain platforms like Ethereum that offer speeds of up to 10,000 transactions per second.

Cost

Hedera Hashgraph has a much lower cost when compared to the price per transaction of using Blockchain technology. The cost per transaction using Hedera is less than one cent, while with Bitcoin, for example, the average fee per transaction constantly fluctuates and is around 15 cents. It also doesn’t take a lot of computer power, unlike blockchain, where mining for crypto uses massive amounts of electrical power to conduct complex computer calculations when verifying transactions. 

Consensus Mechanism

Blockchain uses many consensus algorithms to function smoothly, such as Proof of Work (PoW), Proof of Elapsed Time, and Proof of Stake (PoS), to name a few. Hedera Hashgraph operates using only the virtual voting mechanism and gossip protocol. No other algorithms are required, ensuring it provides a high-performance and low-cost solution that will never fail.  

What’s Next

Hashgraph has many benefits, like speed and efficiency, but has yet to be tested extensively as it has only been deployed in a permission-based, private network. Once it’s released and tested publicly, experts will only then understand the true potential of this intriguing technology. 

Many experts don’t see it ever gaining a competitive edge over existing public blockchains like Ethereum and Bitcoin. Even if Hashgraph doesn’t replace Blockchain technology in the future, there are many places it could fit in the DLT technology space, such as competing with some of the major banking applications currently on the market.