Two weeks ago, with more than 1,000 other Crypto enthusiasts, I had the pleasure of attending the NYC launch event for Hedera Hashgraph, a new public blockchain promising vastly faster throughput.
We all know how slow blockchains are. Now there are many projects working to make the Bitcoin and Ethereum blockchains faster(e.g. Lightning Networks, Plasma, Casper …), and some think these solutions will solve the scaling problem. Other projects are trying to solve the scaling problem by building new “scalability first” blockchains (e.g. EOS, Dfinity, Cosmos).
Hashgraph is solving for the scaling problem through their DAG (Direct Acyclic Graph), which works by combining the gossip protocol with a voting algorithm that enables Hashgraph to to reach consensus quickly and securely without proof of work. Instead of the 3–7 transactions per second (TPS) that the Bitcoin blockchain enables, or the 10–20 TPS that Ethereum can handle, Hashgraph promises to process hundreds of thousands of TPS, surpassing Visa’s current network transaction speeds.
Developers will be able to use Hashgraph technology via a token needed to make a micro-payment to the company for API calls. Until now, Hashgraph was for permissioned based enterprise applications. The key announcement at the event was Hedera, a public blockchain on top of the Hashgraph consensus algorithm. You can watch the entire event on YouTube, or you can save some time and read this post highlighting the five most interesting things I learned at the event.
1. Hedera Not Only Solves For Throughput, It Also Solves For Stability
While Hashgraph was first used for enterprise applications, Phase II is “Hedera”, a public network that rides on top of the existing Hashgraph Consensus Protocol. On top of that platform is a Cryptocurrency service (i.e. a Hedera token) that supports that native micro transactions necessary for the platform to function. There is also a distributed file storage system for applications built on top of the platform. Finally, Hedera will support Solidity scripts to enable smart contracts.
Hadera belevees it uniquely addresses the four requirements of a public distributed ledger:
The technology enables hundreds of thousands of transactions a second
Hedera is aBFT (Asynchronous Byzantine Fault Tolerant), making it highly resistant to distributed denial of service attacks.
Hashgraph believes that it has attained a unique level of “Stability” relative to the other public blockchains by leveraging it’s “state proof” mechanism, and patents, Hedera can’t be forked.
Hedera is deploying a split governance model of open consensus combined with permission governance. Anyone who wants, can operate a node. But the organization will be overseen by a governance model mirrored after that of Visa, which was conceived by Dee Hock in the 60s. There are 39 organizations that will make up the governing council. The governance terms are being finalized, after which the 39 members will be announced.
Finally, Hashgraph is providing transparency by releasing the source code for open review.
There is a test network up and running today on three continents built on top of the Hashgraph Consensus platform. This is all happening now. The Test Network is restricted to internal testing and a few Beta customers. It will begin to be opened up to additional Beta customers later this year.
2. Hedera Hashgraph’s Performance Surpasses Credit Card Quality
Major credit cards like Visa average about 2,000 transactions a second, with peaks reaching 50,000 transactions a second, while maintaining service standards of 7 seconds max. Hedera has achieved 100,000 transactions a second, across 8 regions, with a latency of just 3.3 seconds.
Those speeds will revolutionize the types of applications that will be able to run on a Blockchain.
3. Hashgraph Has A Large & Growing Community
In addition to the 3,000+ developers in their communities, more than 50,000 people have signed up for regular daily emails.
Community is a major element driving success of Crypto projects, and few projects have achieved the scale Hadera has already achieved.
4. Hashgraph Is Providing Two $500,000 Grants To Further Foster The Distributed Ledger Communities
The Distributed Ledger Foundation will work to inform governments about what Crypto regulations should look like around the world. The Foundation’s roadshow starts May 9th at the Stanford School of Law & Informatics. They’ll discuss standards for smart contracts and how voting works in the new systems. There will be similar conferences in London in July, Amsterdam in September, and Singapore in November.
Via smartphones, and leveraging biometircs (e.g. a retinal scan or fingerprint) to validate their identity, Hadera will be supporting initiatives use technology to improve the voting process. Through a second $500,000 grant, the Distributed Ledger Foundation will provide support to projects addressing the major issues in voting like voter fraud, voter suppression, and voter intimidation, by determining the best practices and standards for distributed ledger voting.
5. Hedera Has Multiple Beta Users, Across Industries, Using The Tech For Mission Critical Applications At Scale
Xtremepush is leveraging Hedera to solve for click fraud.
CU Ledger is serving 250 million credit union members around the world and using Hedera to solve for a part of the cross border international payments process.
Intiva Health is using Hedera to solve for the ongoing credentialing of doctors, nurses and other health care professionals
he game studio Machine Zone, with over hundreds of millions of game downloads, is leveraging Hedera to solve for Satori, a distributed AI Mesh, which can process 500 million events a second. A highlight of the Hadera conference was the thirteen minute talk given by Machine Zone CEO.
Everyone at the conference came away even more excited about Crypto’s potential to change the world as the technical problems, like throughput, get solved. I also came away pretty sure that DAGs are a thing.