One-on-one with Hedera Hashgraph
June 1, 2018
ICOVISIONS sat down with Paul Madsen — Technical Lead at Swirld — to hear his two cents on Hedera Hashgraph a.k.a. the “trust layer of the internet”.
What is Hedera Hashgraph?
A product of US-based company Swirlds, Hedera Hashgraph is a public alternative to blockchain based on their proprietary ‘Hashgraph’ consensus mechanism.
While Swirlds is a private tool useful for enterprise-grade permissioned deployments, the company will also be releasing a public protocol in 2018 — Hedera.
What problem does Hashgraph solve and how?
According to Paul, Hashgraph tackles two problems:
Intermediation of trusted third-parties: Hashgraph solves a fundamental issue of contemporary business logic; allowing companies and enterprises to spend money without the need for a trusted intermediary.
Scalability: While public ledgers like Bitcoin and Ethereum have taken a step towards offering trust-less intermediation, Paul sees them as first-generation technologies facing significant barriers to adoption — scalability, throughput, and security, to name a few.
An answer to these shortcomings, Hashgraph delivers greater scalability and security, faster performance — all utilizing a governance model that will be readily adopted by enterprises and individuals alike.
How was Hashgraph invented?
The brainchild of Leemon Baird — the project’s CTO, Co-Founder and Chief Scientist — Hashgraph is the net result of many years of Baird’s deep research into consensus. Its working code already deployed in private scenarios, Hashgraph’s next gauntlet is to be implemented in public applications.
Hashgraph vs Blockchain
Given the scaling challenges faced by today’s blockchains, Hashgraph truly shines when it comes to performance — running up to 500,000 transactions per second in a single shard. When the team implements sharding, this figure will increase significantly, according to Paul.
Yet, there are qualitative differences that set Hashgraph aside from classical blockchains. With an asynchronous Byzantine Fault Protocol consensus, Hashgraph has finality of consensus — lending Hashgraph utility for a number of business applications.
Fairness is another fundamental difference between Hashgraph and blockchain. Where a blockchain’s miners may have the ability to show bias, Hashgraph has been engineered to have no specialized node — a potential cause for abuse of power.
Does Hashgraph have a working product?
On the permissioned side, Hashgraph has in fact been available for more than a year. Its working SDK has been deployed in a number of private applications, and the team will be rolling out a public version of its technology throughout 2018 including services, mainnet and token distribution.
What is the utility of the Hashgraph token?
For any public ledger, it is necessary to protect consensus from attack. In Bitcoin, for example, this is achieved by producing a “scarce resource” — the coins associated with the platform. Hashgraph’s token utility is no different.
Hashgraph will use its tokens to achieve this in two ways:
– Weighting participating votes to establish consensus (‘virtual voting’)
– Requiring every participant node to stake tokens
Furthermore, the token is designed to compensate (and reward) nodes for contributing to maintaining consensus. This reward will be proportionate to the quantity staked; improving the system’s security. To generate these rewards, clients of the platform will be fees negligible compared to those of Bitcoin, and Ethereum.
Does Hashgraph support interoperability?
Hedera — the company’s public platform — will support Solidity smart contracts and ERC20 tokens, allowing existing applications to run on the platform as if they were Ethereum.
Where will the project be at the end of 2018?
Hedera will have an active mainnet, with a number of apps live on top of the platform (a number of companies have already stated their intention to launch on Hedera). Hedera’s near-instant confirmations alone will invariably attract a significant user base.