Ledgers, Distributed and Otherwise
A Distributed Ledger Technology (DLT) is a modern IT innovation enabling the forming of consensus across a distance, within a reasonable amount of time. This makes things like crypto-currencies feasible and practical, as far as the technical aspects of them are concerned. The main challenge that DLTs overcome is creating consensus, since achieving this among different parties that don’t know each other is difficult, especially if a high level of security is required.
What all this means is that with DLT you don’t have any need whatsoever for a middle man, to coordinate the whole process of the transaction, something that translates to better efficiency and lower cost for the user. This, combined with the high level of security a DLT offers, makes it a very promising technology that can benefit various industries.
Blockchain in a Nutshell
Blockchain is one such DLT. It came about in 2008 for the purpose of facilitating interactions and exchanges among different users over the internet. Its creator, Satoshi Nakamoto, is a mysterious figure who published a white paper outlining Blockchain functionality but no-one is certain who he is. Most likely this name is an alias for a person or group of people.
Blockchain is closely linked to monetary transactions using a new form of currency (crypto). The most popular of these is BitCoin, but Blockchain is independent of this or any other crypt-currencies, since there are many other applications linked to this technology.
Hashgraph in a Nutshell
Hashgraph on the other hand is a novel platform for distributed consensus, based on a completely different kind of algorithm for establishing consensus, something essential for creating a ledger. It was created by Dr. Leemon Baird, who built a company around it. Making use of a clever variation of the gossip protocol, Hashgraph can built consensus in a distributed way, very fast and with a high level of security.
Hashgraph is not linked to any crypto-currencies or any particular application per se. However, it can be applied in various ways, at a fairly low computational cost. Nevertheless, this technology is patented so even though applications of it are now free, there is no guarantee that they will not fetch a licensing fee in the future.
Comparison between Blockchain and Hashgraph
Despite their similarities, these two DLTs are different in various ways. For starters, Hashgraph is much faster, since it doesn’t have any computationally expensive processes in its pipeline that are essential in Blockchain for its proof-of-work part.
Hashgraph can also guarantee fairness, something that is a bit of a pain point with Blockchain. The latter is generally fair but with no mathematically proven guarantee of its level of fairness.
Byzantine Fault Tolerance is something that Hashgraph provides when it comes to security. We don’t know of any other DLT that provides this level of security right now. This kind of security ensures that certain network attacks, like Distributed Denial of Service (DDoS) cannot harm a Hashgraph network.
Hashgraph is also very lightweight, as it requires very little power to run. This is a big advantage over Blockchain, which is lately being held responsible for a growing amount of electricity consumption (mainly due to BitCoin applications) that renders it environmentally unfriendly.
On the other hand, Blockchain is open-source, meaning that everyone can benefit from it. On the other hand, if you want to delve into the world of Hashgraph, it may not be as easy to develop commercial applications on it.
Also, if you are interested in crypto-currencies, that’s something that Hashgraph doesn’t provide, while the overall breadth of applications that Blockchain has is larger.
Finally, Blockchain has been around longer so there is more reliable information on it, while the user community is quite big. There are currently even conferences on Blockchain, while several technologists have written books on this technology and its business impact. Hashgraph is fairly underdeveloped in that aspect, even if its creator does a good job popularizing it to various businesses and individuals involved in DLT.
Whether it is Blockchain or Hashgraph that piques your interest, there are several skilled professionals that can help you in exploring these technologies and finding ways to implement them in your business. DSP can provide you with access to a large pool of such talented individuals. Feel free to get in touch with us via our website, or by sending us an email at email@example.com. Things in DLT field may be changing fast but with DSP you can ride the wave of change through the hiring of the right professionals that can keep your organization competitive.