In recent years, the use of blockchain has been quadrupled, and ever since the technology seems unstoppable. Blockchain has gained massive popularity because of its secured and immutable nature. Before making a move to the below text, let’s highlight the blockchain quickly;
Blockchain is a new monetary network that forms a chain of blocks and utilizes the distributed ledger system, which holds a sequential data structure. Whereas in contrast to the blockchain, Hashgraph technology is a consensus method that involves the peer-to-peer network escorted with a gossip protocol.
In technical terms, gossip protocol for Hashgraph is the information that resonates with every participant present on the network. The participants across the node repeatedly share the information of transactions to other members chosen at random.
Now when we are done with a basic introduction of the above-mentioned technologies, it’s time to kickstart our most awaited discussion of how Hashgraph technology differs from blockchain technology.
Let’s delve into the explanation right away!
What is a Distributed Ledger Database (DLD)?
The term distributed ledger by name justifies its working and functionality, it is maintained with a decentralized ledger to retain the information of enormous transactions made. The nodes eliminate the need for a centralized authority, the information stays synchronized and maintained in a decentralized form across the network. Centralized systems have a high risk of getting vulnerable to invasion attacks commonly known as cyber threats.
DL always carries an edge over the conventional systems, ostensibly because
all the information is stored securely using cryptographic techniques. While centralized ledgers are prone to cyber-attacks, it is difficult to attack DLs. To plague the system, every underlying node has to be attacked and manipulated simultaneously which is almost impossible.
Rolling the Blockchain and Hedera Hashgraph into the discussion, both on the same mechanism, they employ different data structures and consensus mechanisms to maintain Distributed Ledger Database.
When we are fully acquainted with the similarity between Blockchain and Hedera Hashgraph, we need to understand the different approaches and use-cases of both technologies.
Hashgraph vs Blockchain!
There are many DLTs out there and currently working with their leveraging impact. The key features of both the distributed ledger technologies are decentralization, security, immutability, transparency, and speed.
DLT can be effective in a centralized system where a system can benefit from transparency, and speed of execution. Distributed ledger technology (DLT) empowers blockchain and Hashgraph, and these technologies empower cryptocurrency
Let’s now try to understand the intricacies of blockchain and Hashgraph!
What is blockchain technology?
Blockchain is a series of consecutive nodes, interlinked with each other through a peer-to-peer network. The blockchain is immutable because the transaction is immutable, which means that it can’t be reproduced, recreated, edited, or changed.
The append-only structure and the whole community backing the system make it a favorite choice for enterprises. The transactions made are in chronological order; and all the blocks are time-stamped.
Blockchain uses cryptography to secure the blocks of records, and the owner has a track of the record through which he can trace it. The digital blocks are tamper-proof and no one can threaten the integrity of data. For example, if someone even tries to tamper with the data, the signature becomes invalid, which sends alarms to the rest of the nodes which expunges the chances of any malicious activity.
Hashgraph- Harnessing the Power of Gossip Algorithms!
Hashgraph is a data structure that works on a graph-like structure where all the nodes transmit and communicate the information to each other. The gossip protocol builds up the communication and stores all the information or data in events.
It relies on the ‘Gossip about Gossip’ and ‘Virtual Voting’ mechanism. In ‘Gossip about Gossip’ the records of who gossiped to whom and in what order. Hashgraph evolves as a collaborative history of gossip events as participants keep augmenting the information about their previous 'gossip' to every current gossip message.
Why does it sound like "gossip about gossip", it is mainly because history likes gossiping about itself.
Using the Gossip about Gossip mechanism, each node on the system is already aware of what the other node knows, and each node can nicely predict subsequently what the other node would vote, eventually, the phenomenon of electronic voting makes its way. The virtual voting Algorithm does not allow voting messages to be sent across the network. Each member has information about what another member would have voted, even without voting.
Since each member receives a copy of the Hashgraph, each member is notified of what the other members across the network would know. Hashgraph is just like the childhood game ‘Chinese Whisper’.
Virtual Voting Mechanism and Gossip About Gossip
Virtual Voting Mechanism
The 'gossip about gossip' protocol maintains that each node is aware of what is already known by another node. Nodes can predict what other nodes will vote for, making it electronic or virtual voting.With the virtual Voting Algorithm, voting messages can't be sent across the network. The members know what each other would have done no matter how they voted.
Gossip About Gossip Mechanism
This protocol transfers transactional information from any node to any other node at random. This mechanism assures that information is circulated effectively and properly.
Hedera Hashgraph Use-Cases
By ensuring transparency and carrying out operations without tampering with data, Hedera Hashgraph mitigates the risks of falling victim to fraud.
With Open Source SDKs for Payment Solutions by Hedera Hashgraph, users of a decentralized network can choose when and to whom they want to share their identity information.
Hashgraph can provide businesses with effective payment solutions that will lead to sustainable growth.
Hedera Hashgraph Platforms
Open Source SDK
A new SDK for Java developers has recently been released for Hedera Hashgraph, an evolving distributed ledger platform. Developers can create Hedera Hashgraph applications using the Open Source SDK. A core feature of Hedera's open-source SDK platform is that it provides services for file storage, smart contracts, and cryptocurrency. All the services and tools necessary to create public and private keys as well as sign transactions are provided by the SDK.
Mainnet Testing Platform
For Hedera Hashgraph's platform, the second round of community testing has been announced. In advance of the mainnet open access, this program facilitates testing of the various network capabilities. In phase II, Hedera is planning to make open-source Android and iOS versions of the wallet and WordPress plugins or extensions. In the community testing phase of the project, developers will have access to these applications to develop micropayments and to test the Hedera network services.
Hedera Hashgraph vs Blockchain: How do they differ from each other?
Hashgraph and blockchain differ primarily in their approach and how these technologies store data. Talking about Blockchain, it stores data in blocks accompanied in a linear way. Whereas the working of Hashgraph is entirely different from the blockchain it utilizes the directed acyclic graph for storing and accessing information. But there’s something common about their approach, these technologies are truly decentralized and each node holds a copy of the ledger.
First thing when it comes to our mind after hearing the decentralized ledger is the secured methods of transactions. Security parameters hold the same for both blockchain and Hashgraph, both stand strong against the tampering of transactional data.
But the approaches aren’t the same, Blockchain utilizes time-stamped cryptographic methods to ensure the security for the data stored and its transmission over the network.
Hashgraph utilizes Asynchronous Byzantine Fault Tolerance (aBFT) to make it resistant against the bombardment attacks from bad actors. Each event is recorded accurately, and the approach makes sure that no data can be altered, even if there are some malicious actors in the network.
The block approach in blockchain makes it difficult for the miners, for instance when two blocks are mined at the same time, one of them is kept and the other one is destroyed/discarded. Only a single block proceeds to the destination eventually, wasting the energy and the efforts.
In contrast to the efficiency parameters of Blockchain, Hashgraph is 100 percent efficient since it isn’t incorporated with the block approach. Consequently, no resources are discarded during the whole process, making it eco-friendly and efficient than blockchain. The reason behind the efficiency is all the events are gossiped about to the network and are kept reserved.
Hashgraph has an edge over the blockchain solutions in speed, as the blockchain is comparatively lower than that of Hashgraph. Hashgraph with its fast speed leaves the blockchain behind, as it can reach a speed of 5,00,000 transactions per second whereas blockchain platforms such as Bitcoin, and Ethereum can only reach up to a speed of only 100 to 10,000 transactions per second.
The gossip protocol is dedicated to providing faster transaction speeds because it requires less information to propagate with more events taking place.
Blockchain carries a whole lot of consensus algorithms, the mechanisms include the Proof-of-Stake, Proof-of-Elapsed Time, Proof-of-Work etc. Whereas your very own Hahgraph technology is rescued from the glitches of various consensus platforms, as it only entails the virtual voting as the form of gaining network consensus.
Patented vs Open-Source
Rolling in the discussion of blockchain and Hashgraph platform sources, blockchain is an open-source distributed ledger technology (DLT) platform, contributing to the creation of cryptocurrencies and utility tokens.
Some blockchain enthusiasts have proved their quality and gained the trust of institutions by embracing blockchain's decentralized nature. But Hashgraph relies on a patented algorithm that is owned by Swirlds. Therefore, any new entry will have to pass through Swirlds
Hashgraph is undoubtedly far better than blockchain technology but it can’t replace blockchain as people are increasingly opting for blockchain technology adoption for their businesses. Hashgraph has its own worth but it will make its own place as time passes, without even replacing the current technologies.