Definition
Hashgraph is a distributed ledger technology designed as an alternative to blockchain. It uses a consensus algorithm based on gossip about gossip and virtual voting to achieve fast, secure, and fair transaction validation. Unlike traditional blockchains that rely on sequential blocks, Hashgraph allows transactions to be confirmed in parallel, offering higher speed and efficiency.
For example, a payment application built on Hashgraph can process thousands of transactions per second with very low fees while maintaining security and transparency.
Advanced
Hashgraph uses directed acyclic graph structures instead of linear chains. Its gossip protocol quickly spreads information across the network, and virtual voting enables consensus without requiring proof of work. This results in high throughput, low latency, and reduced energy consumption compared to blockchains.
Advanced applications of Hashgraph include tokenisation, decentralised finance, digital identity, and supply chain tracking. Hedera Hashgraph is the most well known implementation, offering public governance through enterprise council members. It also integrates with smart contracts and file services for broader use cases.
Why it matters
- Provides faster and more scalable alternative to blockchain.
- Reduces energy usage compared to proof of work systems.
- Improves fairness by ensuring transaction order consensus.
- Expands opportunities for decentralised applications.
Use cases
- Processing micropayments with low transaction fees.
- Securing supply chain provenance data.
- Enabling decentralised identity verification systems.
- Supporting financial services and tokenised assets.
Metrics
- Transactions per second achieved by the network.
- Average transaction finality time.
- Energy cost per transaction.
- Network participation and governance diversity.
Issues
- Limited adoption compared to blockchain alternatives.
- Governance centralisation concerns in early networks.
- Lack of interoperability with other distributed ledgers.
- Regulatory uncertainty for decentralised technologies.
Example
A healthcare provider adopts Hashgraph to record and verify patient consent forms. The system processes updates in real time, ensures data integrity, and provides an immutable audit trail.