Hashgraph

Last updated

Hashgraph
Original author(s) Leemon Baird
Initial releaseJuly 2017
Repository https://github.com/hashgraph/
Type Distributed ledger
Website hedera.com

Hashgraph is a distributed ledger technology that has been described as an alternative to blockchains.The hashgraph technology is currently patented, is used by the public ledger Hedera, and there is a grant to implement the patent as a result of the Apache 2.0's Grant of Patent License (provision #3) so long as the implementation conforms to the terms of the Apache license. [1] The native cryptocurrency of the Hedera Hashgraph system is HBAR.

Contents

Unlike blockchains, hashgraphs do not bundle data into blocks or use miners to validate transactions. Instead, hashgraphs use a "gossip about gossip" protocol where the individual nodes on the network "gossip" about transactions to create directed acyclic graphs that time-sequence transactions. [2] Each "gossip" message contains one or more transactions plus a timestamp, a digital signature, and cryptographic hashes of two earlier events. This makes Hashgraph form an asynchronous Byzantine Fault-Tolerant (aBFT) consensus algorithm. [3]

The process to achieve consensus also relies on a variant of Proof of Stake. Although the content of the transactions themselves is not subjected to consensus because it is handled by the hashgraph itself, their ordering and timestamp still needs to be. A modified version of Proof of Stake is used for this purpose, characterized by not submitting votes as messages in the protocol but rather by "virtual voting", i.e. applying a voting algorithm to calculate what other witnesses of an event would have to vote based on their copies of the hashgraph, and weighting the votes according to the stake of the voter. This is argued to increase efficiency by reducing message-passing. [4]

Hashgraph was invented in the mid-2010s by the American computer scientist Leemon Baird. Baird is the co-founder and chief technical officer of Swirlds, a company that holds patents covering the hashgraph algorithm. [5] [6]

Concept

Hashgraph has been described as a continuation or successor to the blockchain concept, which provides increased speed, fairness, low cost, and security constraints. [7] The Hedera white paper co-authored by Baird explained that "at the end of each round, each node calculates the shared state after processing all transactions that were received in that round and before," and it "digitally signs a hash of that shared state, puts it in a transaction, and gossips it out to the community." [8]

Hedera Hashgraph

Hedera Hashgraph is the only public distributed ledger based on the Hashgraph algorithm. [9] Hedera Hashgraph is developed by a company of the same name, Hedera, based in Dallas, Texas. [9] Hedera was founded by Hashgraph inventor Leemon Baird and his business partner Mance Harmon, and Andrew Masanto, adding significant contribution to the team. [10] Previously, Hedera had an exclusive license to the Hashgraph patents held by their company, Swirlds. The Hedera Governing Council voted to purchase the patent rights to Hashgraph and make the algorithm open source under the Apache License in 2022. [11]

Hedera is owned and managed by a "governing council" of global companies and entities. The council's members include Swirlds, as well as Google, Boeing, IBM, Deutsche Telekom, LG, Tata Communications, Électricité de France, FIS, University College London, the London School of Economics, DLA Piper, Shinhan Bank, Standard Bank, ServiceNow, Ubisoft, Abrdn, DBS Bank, Dell, Hitachi, and several others. [12]

Criticism

It has been claimed that hashgraphs are less technically constrained than blockchains proper. [13] [14] Cornell Professor Emin Gün Sirer notes that "The correctness of the entire Hashgraph protocol seems to hinge on every participant knowing and agreeing upon N, the total number of participants in the system," which is "a difficult number to determine in an open distributed system." Baird responded that "All of the nodes at a given time know how many nodes there are." [15] A hashgraph developer at the time noted that "...a node joining the network is a transaction like any other - it gets assigned a consensus timestamp, after which point all nodes now include it in consensus." [16]

Related Research Articles

A fundamental problem in distributed computing and multi-agent systems is to achieve overall system reliability in the presence of a number of faulty processes. This often requires coordinating processes to reach consensus, or agree on some data value that is needed during computation. Example applications of consensus include agreeing on what transactions to commit to a database in which order, state machine replication, and atomic broadcasts. Real-world applications often requiring consensus include cloud computing, clock synchronization, PageRank, opinion formation, smart power grids, state estimation, control of UAVs, load balancing, blockchain, and others.

A smart contract is a computer program or a transaction protocol that is intended to automatically execute, control or document events and actions according to the terms of a contract or an agreement. The objectives of smart contracts are the reduction of need for trusted intermediators, arbitration costs, and fraud losses, as well as the reduction of malicious and accidental exceptions. Smart contracts are commonly associated with cryptocurrencies, and the smart contracts introduced by Ethereum are generally considered a fundamental building block for decentralized finance (DeFi) and NFT applications.

Double-spending is a fundamental flaw in a digital cash protocol in which the same single digital token can be spent more than once. Due to the nature of information space, in comparison to physical space, a digital token is inherently almost infinitely duplicable or falsifiable, leading to ownership of said token itself being undefinable unless declared so by a chosen authority. As with counterfeit money, such double-spending leads to inflation by creating a new amount of copied currency that did not previously exist. Like all increasingly abundant resources, this devalues the currency relative to other monetary units or goods and diminishes user trust as well as the circulation and retention of the currency.

Namecoin is a cryptocurrency originally forked from bitcoin software. It uses proof-of-work algorithm. Like bitcoin, it is limited to 21 million coins.

<span class="mw-page-title-main">Bitcoin protocol</span> Rules that govern the functioning of Bitcoin

The Bitcoin protocol is the set of rules that govern the functioning of Bitcoin. Its key components and principles are: a peer-to-peer decentralized network with no central oversight; the blockchain technology, a public ledger that records all Bitcoin transactions; mining and proof of work, the process to create new bitcoins and verify transactions; and cryptographic security.

<span class="mw-page-title-main">Ethereum</span> Open-source blockchain computing platform

Ethereum is a decentralized blockchain with smart contract functionality. Ether is the native cryptocurrency of the platform. Among cryptocurrencies, ether is second only to bitcoin in market capitalization. It is open-source software.

<span class="mw-page-title-main">Nxt</span> Cryptocurrency

NXT is an open source cryptocurrency and payment network launched in 2013 by anonymous software developer BCNext. It uses proof-of-stake to reach consensus for transactions—as such, there is a static money supply. Unlike Bitcoin, there is no mining. NXT was specifically conceived as a flexible platform around build applications and financial services, and serves as basis for ARDR (Ardor), a blockchain-as-a-service multichain platform developed by Jelurida, and IoTeX (cryptocurrency) the current steward of NXT as of 2021. NXT has been covered extensively in the "Call for Evidence" report by ESMA.

<span class="mw-page-title-main">Dash (cryptocurrency)</span> Cryptocurrency

Dash is an open source cryptocurrency. It is an altcoin that was forked from the Bitcoin protocol. It is also a decentralized autonomous organization (DAO) run by a subset of its users. It was previously known as Xcoin and Darkcoin.

<span class="mw-page-title-main">Stellar (payment network)</span> Cryptocurrency

Stellar, or Stellar Lumens, is an open-source, decentralized protocol for digital currency to fiat money low-cost transfers which allows cross-border transactions between any pair of currencies. The Stellar protocol is supported by a Delaware nonprofit corporation, the Stellar Development Foundation, though this organization does not enjoy 501(c)(3) tax-exempt status with the IRS.

A blockchain is a distributed ledger with growing lists of records (blocks) that are securely linked together via cryptographic hashes. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data. Since each block contains information about the previous block, they effectively form a chain, with each additional block linking to the ones before it. Consequently, blockchain transactions are irreversible in that, once they are recorded, the data in any given block cannot be altered retroactively without altering all subsequent blocks.

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A decentralised application is an application that can operate autonomously, typically through the use of smart contracts, that run on a decentralized computing, blockchain or other distributed ledger system. Like traditional applications, DApps provide some function or utility to its users. However, unlike traditional applications, DApps operate without human intervention and are not owned by any one entity, rather DApps distribute tokens that represent ownership. These tokens are distributed according to a programmed algorithm to the users of the system, diluting ownership and control of the DApp. Without any one entity controlling the system, the application is therefore decentralised.

A distributed ledger is the consensus of replicated, shared, and synchronized digital data that is geographically spread (distributed) across many sites, countries, or institutions. In contrast to a centralized database, a distributed ledger does not require a central administrator, and consequently does not have a single (central) point-of-failure.

<span class="mw-page-title-main">Ethereum Classic</span> Blockchain computing platform

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IOTA is an open-source distributed ledger and cryptocurrency designed for the Internet of things (IoT). It uses a directed acyclic graph to store transactions on its ledger, motivated by a potentially higher scalability over blockchain based distributed ledgers. IOTA does not use miners to validate transactions, instead, nodes that issue a new transaction on the network must approve two previous transactions. Transactions can therefore be issued without fees, facilitating microtransactions. The network currently achieves consensus through a coordinator node, operated by the IOTA Foundation. As the coordinator is a single point of failure, the network is currently centralized.

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Andrew Jonathan Masanto is an entrepreneur, and co-founder of two of the top 100 cryptocurrencies, Hedera Hashgraph in 2017 and Reserve in 2019. He and his brother Christopher Masanto also co-founded Pet Lab Co, a fast growing pet company in the USA in 2021.

References

  1. ↑ ".NET Client Library for Hedera Hashgraph". GitHub . 18 August 2022.
  2. ↑ Tapscott, Don; Tapscott, Alex (2016). Blockchain Revolution: How the Technology Behind Bitcoin Is Changing Money, Business, and the World. Penguin. ISBN   9781101980156.
  3. ↑ Treiblmaier, Horst; Beck, Roman (2018). Business Transformation through Blockchain, Volume 2. Cham: Palgrave Macmillan. p. 98. ISBN   9783319990576.
  4. ↑ "Virtual Voting". Hedera Documentation. Retrieved 25 April 2024.
  5. ↑ "Can hashgraph succeed blockchain as the technology of choice for cryptocurrencies?", The Hindu , 25 March 2018
  6. ↑ "Hashgraph wants to give you the benefits of blockchain without the limitations", TechCrunch , 14 March 2018
  7. ↑ Panetto, Herve; Debruyne, Christophe; Proper, Henderik; Ardagna, Claudio; Roman, Dumitro; Meersman, Robert (2018). On the Move to Meaningful Internet Systems. OTM 2018 Conferences: Confederated International Conferences: CoopIS, C&TC, and ODBASE 2018, Valletta, Malta, October 22-26, 2018, Proceedings, Part 2. Cham: Springer. p. 281. ISBN   9783030026707.
  8. ↑ Baird, Leemon; Harmon, Mance; Madsen, Paul (13 August 2019). "Hedera: A Public Hashgraph Network & Governing Council" (PDF). Hedera (version 1.5 ed.). Archived from the original (PDF) on 11 November 2020. Retrieved 23 April 2024.
  9. 1 2 "How Hedera Hashgraph is building a fast and secure blockchain alternative", VentureBeat , 4 August 2018, retrieved 20 March 2021
  10. ↑ "Hedera's Journey". Hedera. Retrieved 31 January 2024.
  11. ↑ "Hedera Governing Council Votes to Purchase Hashgraph IP,…". Hedera. 19 January 2022.
  12. ↑ "Hedera Governing Council". Hedera Hashgraph. Retrieved 31 May 2021.
  13. ↑ "Can hashgraph unseat blockchain as the favoured tech for cryptocurrencies?", Live Mint , 20 March 2018
  14. ↑ "Next-Generation Crypto-Ledgers Take the Block Out of Blockchain". Bloomberg . Retrieved 24 February 2018.
  15. ↑ "Hedera Hashgraph Thinks It Can One-Up Bitcoin And Ethereum With Faster Transactions", Forbes , 13 March 2018
  16. ↑ "Cooper Kunz tweet", Twitter, 14 August 2019
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