Today's era is famous for the un-matchable tech advancements and innovations unfolding the opportunities for entrepreneurs. For the past few years, the technology holding the top position is the blockchain, and most businesses have experienced its potential to date. It is the second biggest achievement in the tech world after the Internet's introduction to the world. Blockchain is based on distributed ledger technology that eliminates the concept of a central entity.
It is a database where transactions or shared smart contracts are maintained in a decentralized form so that people can access them easily. The data is stored in encrypted form, ensuring better security. Also, it is hard to hack the ledger as all the nodes need to be hacked simultaneously to alter the information. Blockchain and Hashgraph use different data structures and consensus algorithms to maintain the distributed ledger database.
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Nobody can deny the success achieved by blockchain frameworks. However, with passing the time, the DLT has given birth to new tech, "Hashgraph." So, now these two technologies, Blockchain and Hashgraph based on DLT, are competing. Both the techs solve the same issues in the trust-less environment but with a different approach. As both the techs are based on the same foundation, people constantly make the comparison between the two and declare the one as a winner based on their opinions. So as the competition is very high, we can say that the introduction of the Hash graph can be a threat to blockchain’s popularity.
Let’s move into details and know the key difference between both and who can win the game.
Blockchains and Hashgraphs are different types of distributed ledgers. The latter is anticipated to overcome the challenges of blockchain technology. And this new wave of Hashgraphs can reduce the popularity of the blockchain networks in the coming times. The hash graphs claim to be faster and more secure than blockchains. To reach the right conclusion, we will first explore both technologies individually and then compare them to understand their positives and weaknesses.
It is a distributed ledger that records and saves the transactions happening on the blocks. And all the participants present on the network can access the information globally. The blocks are linked together, so it is impossible to change any block and hack the system. Blockchain builds a peer-to-peer network where users can interact with each other over the network.
Hashgraph is patent by Swirlds, a development platform for fully distributed applications. It promises to overcome the gaps left by blockchain technology. It has its own cryptocurrency called HBAR. It is created using LISP and Java programming languages. Its speed is the most talked about topic. Following are the two main features that help it get the fairness in transactions and security:
The term Gossip about Gossip means transferring and syncing the information from one node to another. The process makes sure that the data is circulated to all the nodes present in the network.
The mechanism mentioned above ensures that all the nodes know what information other nodes have, and every node can predict what the other node will vote for. It will be like an electronic or virtual voting process. The hash graph generates the history of the gossiping events.
The main thing that makes a significant impact is what is the approach followed. And both the technologies follow completely different approaches though the primary foundation is the same. Blockchain saves the data in linear form like blocks connected in one line. At the same time, the hash graph is an acyclic graph to store the information. In both, every node has a copy of the ledger, which makes it completely decentralized.
Both the techs offer excellent security. Blockchain uses encryption to secure the data stored and transmitted over the network. Therefore, the intruders can not enter the network and steal the information. The blocks are tamper-proof and safeguard the whole information from digital attacks. Even if someone tries to tamper with data integrity, the signature concept comes into play as it shows invalid signatures, which alerts the nodes about suspicious activity.
However, Hashgraphs is based on the Asynchronous. The mechanism makes sure that the data is secured even if a malicious actor tries to steal the information. Once the transaction is done, it cannot be changed or edited. Both of them offer the same level of security.
Blockchain has multiple approaches for consensus depending on the platform and cryptocurrency type. Blockchain has many popular consensus algorithms like proof of work, proof of stake, etc. Also, NEO is another form of algorithm based on delegated Byzantine Fault Tolerance. It is an improved version of the PoF and PoS. On the other hand, the Hashgraph uses the process of virtual voting. Hashgraph itself is more like a consensus algorithm, but the experts determined it does not have anything better than blockchain to offer in terms of the consensus algorithm.
Depending on the solution, the blockchain’s speed is different. But if we compare it with the hash graph, it is slower. Hashgraph can reach upto 5,00,000 transactions per second but keep in mind that it can vary depending on the other conditions. On the other hand, blockchain solutions like Ethereum and Bitcoin are pretty slow and can execute 10,000 transactions per second. If we talk about the reason behind it, its gossip to gossip method makes it possible. With this, less information needs to be circulated across the network, which is beneficial when more events occur on the network.
If we compare both technologies' fairness, blockchain stands at the second position, and the Hashgraph wins here. The miners have more power when selecting the orders to process and stop them. It can be unfair to the people present directly or indirectly on the network. Hashgraph offers better fairness than blockchain technology as it allocates random nodes. It uses time stamping consensuses to ensure that nobody gets affected due to the transaction order. Fairness is one of the most praised factors for hashgraph, which was missing in the blockchain.
The cost of transactions is different in blockchain, and the higher fee transactions get the priority. The transaction cost is generally more than $15, coupled with the transaction's limited speed, which can be 4 to 15. If the transaction speed is higher,it can go upto $25 to $30. The transaction cost is the same in the case of hashgraphs. However, the cost can vary depending on certain factors. The minimum price can start from $0.0001.
Hashgraphs are proved more efficient due to the approach followed. The blockchain approach makes it difficult for the miners to work on the two blocks simultaneously. That means the miners need to discard the one block out of the two. This way, the efforts are wasted and reduce the network efficiency. On the other hand, the hashgraph does not rely o the blocks, but it works based on the events. So, it does not experience the problem present in the blockchain networks.
There is no better technology than blockchain when it comes to the adoption and blockchain development approach. It has been in the industry for quite a long time compared to hashgraph. There are various chances where the success of blockchain technology has been seen, like it supports dApps and smart contract development.
The hashgraph is still very far from the blockchain to the adoption and development stage. Above all, it is still a patent technology, and the public version is in the development stage yet. Many companies are using hashgraph, but the number is too low compared to the blockchain adoption.
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We have analyzed the positives and the negatives of both technologies. After knowing all the details, you might be thinking that will hashgraph replace the blockchain? An honest answer is still hard to conclude as many business domains explored blockchain more than the hashgraphs. But hashgraph is on the path of reaching the different business verticals.
Based on certain features, we can say that hashgraph is better than the blockchain and has overcome the blockchain problems and vice versa. But if you see the exposure and the applications, blockchain is widely adopted by the various industries and gaining continuous success. With time, we hope to conclude which one is the best.
Hashgraph is an advanced technology we all know. But it nowhere guarantees that it will completely replace the blockchain’s existence in the coming time. Hashgraph is privately owned, so its adoption is very slow in the industry. Have you got a clear understanding of the two high-end technologies? If yes, you can easily decide which one you prefer based on your needs. Whether you plan to launch an application based on blockchain or hashgraph, the one standard move is that you need to consult with the experts, either a blockchain development company or a hashgraph development company depending on your requirements and budget.
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