Distributed Ledger Technology (DLT) has evolved rapidly since the advent of blockchain, but innovation doesn’t stop there. While blockchain remains the most widely recognized implementation of DLT, new architectures like Hashgraph are emerging as powerful alternatives. At the forefront of this movement is Hedera, the only public network utilizing Hashgraph technology to deliver high-speed, secure, and sustainable decentralized systems.
With support from a globally diverse governing council and performance metrics that far surpass traditional blockchains, Hedera is gaining attention from enterprises, developers, and institutional leaders alike. But what exactly sets it apart? Let’s explore the technology, governance, and native token behind this next-generation DLT platform.
Understanding Hashgraph: A New Paradigm in DLT
Unlike blockchain, which organizes data into sequential blocks linked cryptographically, Hashgraph uses a Directed Acyclic Graph (DAG) structure to record transactions. This architectural shift enables faster consensus, greater scalability, and improved security—without relying on energy-intensive mining.
In a DAG, data points (called vertices) are connected by directional links (edges), forming a web-like structure where information flows forward but never loops back. This ensures immutability and chronological integrity while allowing parallel processing of transactions—an advantage over linear blockchains.
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How Hashgraph Achieves Consensus: Gossip About Gossip
At the heart of Hedera’s performance is its dual-protocol consensus mechanism:
1. Gossip Protocol ("Gossip About Gossip")
The term “gossip” here refers to the way nodes share information. When a node receives a transaction, it randomly shares that data with another node. That node then gossips it further, creating a rapid, virus-like spread across the network.
But Hashgraph doesn’t just pass along transactions—it also shares metadata about how and when it received them. This “gossip about gossip” allows each node to reconstruct the exact order of events across the entire network, even if they didn’t directly receive the original message.
This process naturally builds a DAG of communication history stored across all nodes—enabling full transparency and auditability.
2. Virtual Voting (aBFT Consensus)
Once the gossip network has disseminated transaction data, virtual voting determines finality. Instead of broadcasting votes, nodes infer what others would vote based on the shared history in the graph.
For a transaction to be confirmed, it must achieve asynchronous Byzantine Fault Tolerance (aBFT)—meaning the system remains secure even if up to one-third of nodes are offline or malicious. Finality is reached when two-thirds of nodes act as witnesses to an event.
This method eliminates the need for repeated messaging or proof-of-work, resulting in near-instant confirmation times and exceptional resilience.
Hedera’s Unique Governance Model
One of Hedera’s most distinguishing features is its decentralized governance framework, led by a council of global industry leaders.
The Hedera Governing Council consists of up to 39 members from various sectors and regions worldwide. Currently, 29 seats are occupied by organizations including Google, LG, Dell, Boeing, and TATA Communications. Notably, Swirlds, the company founded by Dr. Leemon Baird—the inventor of Hashgraph—holds a permanent seat.
Council members serve three-year terms, with a maximum of two consecutive terms allowed. This rotation policy ensures long-term decentralization and prevents any single entity from exerting prolonged control.
Council Composition Goals
To maintain balanced representation, the council follows strict inclusion criteria:
- At least one member from each Global Industry Classification Standard (GICS) sector.
- Representation from top-tier universities ranked among the top 10 in their region.
- Inclusion of leading international non-governmental organizations (NGOs).
- Regional diversity with at least three members each from North America (NA), South America (SA), Europe, Middle East & Africa (EMEA), and Asia-Pacific (APAC).
This structure ensures that decisions about protocol upgrades, fee models, and network policies reflect global interests—not just those of developers or investors.
HBAR: The Native Cryptocurrency of Hedera
Like most DLT platforms, Hedera has its own native utility token: HBAR.
HBAR serves three primary functions within the ecosystem:
- Network Security: Nodes that validate transactions and maintain consensus are rewarded with HBAR.
- Transaction Fees: Users pay minimal fees in HBAR to execute smart contracts, transfer tokens, or interact with decentralized applications (dApps).
- Staking: Participants can stake HBAR to support network operations and earn rewards.
With a maximum supply capped at 50 billion HBAR, approximately 31.6 billion are currently in circulation. The token distribution was carefully planned to support long-term growth and decentralization:
- 32.41% — Hedera Pre-Minted Treasury (released over time)
- 23.99% — Ecosystem Development (grants, partnerships, developer incentives)
- 17.40% — SAFTs and Purchase Agreements (early investors)
- 7.96% — Swirlds
- 7.96% — Founders
- 4.44% — Employees
This allocation emphasizes sustainability and broad adoption over speculative gains.
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Performance Advantages Over Traditional Blockchains
When comparing DLT platforms, real-world performance metrics matter. Here's how Hedera stands out:
| Metric | Bitcoin | Ethereum | Hedera |
|---|
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- Throughput: Hedera supports up to 10,000 transactions per second (TPS)—dwarfing Bitcoin’s 5 TPS and Ethereum’s ~13 TPS.
- Finality: Transactions achieve finality in 3–5 seconds, compared to minutes or even hours on older chains.
- Cost: Average transaction fee is just $0.00001, making microtransactions feasible.
- Sustainability: Hedera is carbon-positive, actively removing more CO₂ than it emits—unlike proof-of-work chains with massive energy footprints.
These attributes make Hedera ideal for enterprise use cases such as supply chain tracking, identity verification, tokenized assets, and real-time payments.
Frequently Asked Questions (FAQ)
What makes Hashgraph different from blockchain?
Hashgraph uses a DAG-based consensus algorithm with "gossip about gossip" and virtual voting, enabling faster speeds, higher security (aBFT), and lower costs than traditional blockchains.
Is Hedera fully decentralized?
Yes. While early development was led by Swirlds, governance is now distributed among 39 global organizations via the Hedera Governing Council, ensuring decentralized decision-making.
Can I mine HBAR?
No. HBAR cannot be mined. It was pre-minted and distributed according to a fixed schedule. Network validation is achieved through staking and consensus participation, not mining.
How secure is the Hashgraph consensus?
Hashgraph achieves asynchronous Byzantine Fault Tolerance (aBFT)—the highest level of security in distributed systems—meaning it remains safe even if some nodes fail or act maliciously.
What are common use cases for Hedera?
Hedera is used for tokenization of assets, decentralized identity (DID), supply chain transparency, CBDCs (Central Bank Digital Currencies), NFTs, and enterprise-grade dApps requiring speed and compliance.
Why do major companies support Hedera?
Enterprises value its predictable fees, regulatory compliance readiness, high throughput, and environmentally sustainable design—key factors for large-scale deployment.
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Final Thoughts
Hedera represents a significant leap forward in distributed ledger technology. By combining the efficiency of DAG architecture with aBFT security and responsible governance, it offers a compelling alternative to traditional blockchains.
With HBAR enabling low-cost transactions and node incentives, and a council-backed model ensuring long-term stability, Hedera is well-positioned to power the next wave of digital innovation—from financial infrastructure to decentralized identity and beyond.
As adoption grows and more developers build on its robust foundation, Hedera could play a pivotal role in bringing trustworthy, scalable DLT into mainstream enterprise use—ushering in a new era of digital trust.
Core Keywords: Hashgraph, Hedera, HBAR, Distributed Ledger Technology, aBFT, Gossip Protocol, DLT, consensus mechanism