Hedera review: hashgraph consensus and a governing council
Hedera uses a hashgraph instead of a chain of blocks and is governed by a council of organisations.
Hedera is a public network based on the hashgraph algorithm invented by Leemon Baird. Its main network opened to the public in 2019.
Hashgraph instead of blocks
Hedera does not build a chain of blocks. Nodes share information through "gossip about gossip": they tell each other about transactions and about who told whom what. From this history, every node can calculate the same order of transactions through virtual voting, without sending extra votes. The result is fast, final ordering.
Governance
Hedera is governed by the Hedera Council, a group of organisations from different industries that run nodes and make decisions about the network. This makes its governance more structured — and more permissioned — than in networks where anyone can become a validator.
Services
- Cryptocurrency transfers in HBAR.
- Token service for creating tokens without writing smart contracts.
- Consensus service for ordering and timestamping messages from other applications.
- Smart contracts compatible with Ethereum tooling.
The HBAR token
HBAR pays network fees and is used for staking, which helps secure the network.
Patents and open source
The hashgraph algorithm was originally patented. Hedera later released its codebase under an open-source licence, which lets others review and build on the code. As with any network, the openness of the code and the openness of participation (who may run a node) are separate questions.
Risks
The council-based governance is a trade-off between stability and decentralisation; adoption and competition are the usual risks.
The market is on the HBAR coin page.
This review describes the project's design and is not investment advice. Cryptocurrency prices can be highly volatile.
Blog posts are for education and information only and are not investment, legal or tax advice.