Blockchain or Hedera HashGraph

Blockchain was invented by Satoshi Nakamoto in 2008. The popularity of blockchain increased multiple times when its use cases other than cryptocurrencies have been explored.

Hash graph is designed by Leemon Baird (co-founder and CTO of Swirlds) in 2016. The public version, Hedera Hashgraph is said to be a strong competitor of blockchain technology and claims to replace it.

What is a Distributed Ledger Technology?

A distributed ledger technology is described as:

• A digital system where transactions of assets are recorded. The transaction details are available at multiple places.
• The ledger is not maintained by a centralized authority, instead, it is maintained by multiple peers in a decentralized manner.
• All the information is stored securely using cryptographic techniques.
• The ledger is immutable. If a malicious attacker wants to change anything in the ledger then he has to reflect the change in every place, which is quite expensive for change. Hence it is difficult to get attacked.

The data structures and the consensus mechanisms used by the Blockchain and Hedera Hashgraph are different but they both maintain Distributed Ledger Database.

Defining Blockchain

Blockchain is an incorruptible distributed ledger technology. It facilitates interactions and exchanges among different users on the internet. Blockchain is based on hash functions The transactions in a blockchain are stored in chronological order and are protected by strong cryptographic Hash Functions. The encrypted blocks are chained to the previous blocks via the block hash of the previous block. And thus create a chain of blocks and hence the name blockchain.

Defining Hashgraph

Hash graph is a consensus mechanism based on virtual voting algorithms combined with the gossip protocol to achieve consensus, fairly, securely, and efficiently. Unlike blockchain, it is based on a graph-like structure. All the nodes which communicate with each other form a graph-like structure indicating connections as links. Events mechanism is used to store the information.

Gossip about Gossip:

Nodes communicate with each other using gossip protocol which is based on the random transfer of information which is gossip here.

Virtual Voting:

The nodes propagate the meta-information to vote on the ordering of the information sent events.

Hashgraph vs. Blockchain

Consensus Mechanism

Hedera Hashgraph uses aBFT (Asynchronous Byzatine Fault tolerance) while blockchain uses various consensus algorithms depending upon the type of blockchain (for example, Proof of Work, Proof of stake, Raft, etc).

Security

Blockchain ensures security by utilizing cryptographic methods. It is tough to tamper with a block in the blockchain.

Using aBFT, Hashgraph secures the network from malicious actors and makes it resilient to botnets and DDoS attacks. However, in the Hedera hashgraph, there is an assumption of having bad actors.

Efficiency

Hash Graphs are 100 % efficient since it does not rely on block creation.

Speed

In hashgraph, the information travels so, they are much faster as they can perform 5,00,000 transactions per second which is very high as compared to blockchain. It can perform 100 to 10000 transactions per second.

Fairer

Hashgraph uses a consensus of timestamp, hence in this nodes can not change the order of transaction which is not the case in the blockchain. In the blockchain, miners can control the order of the transactions.

Development Stage

This is the area where Hashgraphs lag the blockchain. Despite having high security, efficiency, and speed, its adoption rate is low. One of the reasons for this low adoption is that it is patented and not open-source. So the entire control of hashgraph is with the owner of it which reduces the trust of huge masses.

A brief comparison is shown in the figure below:

Major companies using Hedera Hashgraph are:

1. Hashing System
2. Earth. Id
3. Zeux
4. Alto.io
5. Scidex

So what do you think? Who would win the race?

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