Many users will agree with the opinion that blockchain strategy is an excellent alternative to classical systems and registries but has some disadvantages. For all the time of its existence, there have been many different statements that it was possible to find a full-fledged replacement for blockchains, but they were all a scam and did not represent a real alternative. But the Hashgraph project has interested many users, so we will devote this material to reviewing the features of Hashgraph.
The correct answer to the task creates a new block of information. The blockchain structure is built from these blocks. The information of the blocks is the digital currency: bitcoin (Bitcoin), Ethereum (Ethereum), the cost of the Ether cryptocurrency for today and other currencies can be viewed on the website. The creators of the blocks, miners, receive certain amounts of virtual coins for calculations. Another mandatory purpose of settlements is to maintain the cryptocurrency system in a working state, i.e. the ability to store and transfer virtual money.
The technology of blockchain and some other currencies is such that it requires more and more computing power and energy to create each new information block.
The growth of the information system inevitably leads to a drop in the speed of operations.
Blockchain does not solve the “task of the Byzantine generals” (Byzantine error).
Simplistically, this is the possibility of “betrayal” of some elements of the system. The structure works as long as the majority of its members act “honestly”. An example of a risky situation is the choice of the order of transaction processing by the participants of the bitcoin blockchain. The growth of the cryptocurrency system can lead to contradictions of participants and even separation. What happened recently with Bitcoin: Bitcoin Cash (BCC) and Bitcoin Gold (BTG).
In many ways, this is similar to the blockchain that we understand a little more;
Hashgraph is designed for the same as Blockchain:
Why is a hashgraph better than a blockchain?
Hashgraph developers position their product as a more efficient and productive alternative to blockchain. It represents a new consensus mechanism that is able to provide:
How is Hashgraph superior to the classic blockchain? As a rule, the following attributes are attributed to this technology: decentralization, stability, security, immutability, anonymity and flexibility. According to the Hashgraph developers, they managed to preserve all the qualities described above and additionally add the most important criterion to the list – fairness.
Hashgraph technology is newer than Blockchain. It takes into account the mistakes of its predecessors. In the hashgraph, not all information is exchanged, but it is updated. This is the reason for the higher speed.
Competition is possible in the blockchain – if several miners simultaneously calculate new blocks, the system will accept the one that will be signed first, the other miner will be left with nothing. The hashgraph does not take into account blocks but transactions. And all of them are paid.
As we have already said, Hedera’s success is based on the fact that the hashgraph offers better results than blockchains. But how exactly do they differ?
It all comes down to the capabilities and speed of the hashgraph. Unlike other blockchain-based platforms, Hedera Hashgraph does not require high computational costs for the Proof of Work algorithm. For comparison, Hedera Hashgraph can process up to half a million transactions per second.
Blockchains process their transactions much slower to get an acceptable level of security. They are capable of processing from 100 to 10,000 transactions per second, depending on the platform.
Moreover, for the simple execution of such transactions, usually requires a huge amount of energy and large bandwidth. As a result, blockchain-based platforms often charge relatively high fees for simple cryptocurrency transactions.
We talked about the fact that Hedera Hashgraph uses a directed acyclic graph to record transactions. The data structure of the cryptocurrency platform determines how secure and efficient transactions will be. The use of DAG is a unique feature of Hedera and is not typical for blockchains. For blockchain-based platforms, transactions are recorded in “blocks”. The blockchain collects sets of information that are placed in blocks for storage. When this block is filled, another block is created, which clings to the previous one, forming a single line of the blockchain.
Hedera is designed so that transactions in it are processed in parallel, not sequentially. The system stores data in the form of events and combines the gossip protocol with virtual voting. This ensures faster data distribution and faster transaction speeds.
Thanks to the use of DAG, Hedera does not have to choose between speed and safety. Blockchains were originally designed so that the confirmation process takes a certain amount of time, so security is not compromised.
Accessibility is another difference between a hashgraph and a blockchain. Blockchains are widely used by cryptocurrency platforms due to the fact that they are public. Although the blockchain itself is technically unrelated to the principles of free software, blockchain systems are usually combined with open –source software. On the other hand, hashgraph technology is only available through Hedera.
Let’s look at all the similarities and differences using the table.
Participants have the opportunity to mint new tokens using various consensus mechanisms.
Nodes create consensus through virtual voting.
Transactions per second
It is highly limited in terms of scalability and TPS.
Unique consensus mechanisms reduce the computational load. Therefore, they provide high scalability and a high TPS rate.
The data is structured in blocks in the order of transactions, which are verified by miners in the ecosystem.
Virtual voting ensures that transactions will be confirmed by a majority.
Miners have the right to postpone the transaction or cancel it completely.
Confirmation of transactions according to the consensus.
Networks running on the platform
Bitcoin and Ethereum are the most popular networks built on the blockchain.
Swirlds and NOIA are the only networks on Hashgraph.
Currently, no one believes that Hashgraph will be able to displace blockchain from the market. However, Hashgraph offers many advantages over using blockchain. However, the adoption of blockchains is currently only growing, and with the use of private blockchains, enterprises are now also ready to start using blockchain.
There are already many companies using blockchain technology, and many people believe that this is just the beginning of a new era. On the other hand, the Hedera hashgraph itself can gain the upper hand and gain the popularity of many users. No other technologies will replace it.
Although blockchain does have a lot of problems, this is not enough to reduce the popularity of this technology.
Banks, exchange platforms, investment funds and insurance companies are already being created on the basis of the blockchain. Cryptocurrencies are increasingly accepted by sellers as a means of payment, sometimes even more willingly than dollars, euros or pounds. Even stock traders are actively working with cryptocurrencies today.
It indicates that the future lies behind the blockchain development companies that create distributed registry technology. It is simply impossible to avoid this new technology if you do not want to “stay overboard”.
In addition, the technology allows you to apply the function of intelligent production management through the use of robots, which will allow you to regulate the processes of accounting, order formation, marketing, sales and logistics.
It will also be possible to automatically determine the need for a particular product in any part of the world.
The main concept of such projects is the creation of a network of farms, factories, restaurants connected to each other and with the consumer on the basis of blockchain technology. It is assumed that farms will grow raw materials, avoiding contact with intermediaries, and factories will process these raw materials. Restaurants and consumers, again, without the participation of intermediaries, will buy it from the original manufacturer.
Experts’ opinions were divided. Some of them believe that a new, more advanced technology will soon replace the blockchain for the benefit of all mankind.
It will eliminate hacker attacks, minimize spam, make the Internet more accessible and efficient due to decentralization, and increase the speed of device interaction.
Another part believes that there is nothing fundamentally new in the hashgraph, and they will be used in parallel with the blockchain.
So far, too little time has passed to speak with confidence about the bright prospects.
However, the belief in HG of large companies is a strong argument for taking this development very seriously.
The advantages of the hashgraph are obvious. It is the future, which is why our cryptocurrency GRAME is created on this technology.
Some of the declared advantages of the hashgraph, for example, a significant jump in throughput, look extremely attractive and promising, however, for confident statements, practical implementation and “strength testing” in “combat” conditions (in a public global cryptocurrency) are required.
Note also that the hashgraph is not the first attempt to create a distributed registry not on the blockchain. Another example is the DAG (directed acyclic graph) technology, on the basis of which the Byteball and IOTA cryptocurrencies already work. DAG also has a number of very useful properties (compared to blockchain): tolerance to accidental isolation of a part of the network and the ability to conduct transactions one at a time without waiting for the next block.
Blockchain experts say that the creator of the hashgraph Leemon Baird, co-founder and technical director of Swirlds Inc, idealizes the possibilities of his brainchild. In real life, packets of information are lost and can be falsified. In addition, the advantages of the technology, such as the possibility of micropayments, the lack of complexity of code calculation, user competition and related speculative investments, will prevent a rapid set of capitalization.
There are those who are confused that the hashgraph is patented. Blockchain in the mass consciousness has already become a national treasure after the retirement of Satoshi Nakamoto, but no one has this information reliably. Most likely, blockchain and hashgraph technologies will coexist. And in parallel, we will see the emergence of new data transmission systems.
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