Hedera HBAR
About
What Is Hedera (HBAR)?
Hedera is the most used, sustainable, enterprise-grade public network for the decentralized economy that allows individuals and businesses to create powerful decentralized applications (DApps).
It is designed to be a fairer, more efficient system that eliminates some of the limitations that older blockchain-based platforms face — such as slow performance and instability.
It was funded through an initial coin offering (ICO) in August 2018 and first launched open access to its mainnet just over a year later in September 2019. As part of the ICO, investors were able to purchase the platform’s native utility token (HBAR) at the lowest possible pricing.
The HBAR token has a dual role within the Hedera public network.
First and foremost, HBAR the fuel that powers Hedera services, such as smart contracts, file storage and regular transactions. Second, it's used to help secure the network, since HBAR users can stake their tokens to assist with maintaining the integrity of the platform.
Hedera (HBAR) is the native cryptocurrency of Hedera Hashgraph, a platform that is positioned as an alternative to traditional blockchain technology and aims to excel in speed, efficiency and security.
Older blockchains tend to use a consensus mechanism like proof-of-work (PoW) to validate transactions, while younger blockchains opted for proof-of-stake (PoS). The Hedera Hashgraph system has a structure that was created from scratch particularly for the project. Hedera is based on a PoS model that is believed to increase the efficiency of transaction verification in the network, provide a high level of security, and protect the network from hacker attacks. Its ecosystem has the underlying hashgraph consensus algorithm and the global enterprise governing body.
Hedera Hashgraph is a distributed ledger technology (DLT). According to the project website, Hedera differs from other blockchains because it uses a new consensus algorithm called hashgraph. It intends to process and execute transactions faster, eliminate delays, and smooth out the TPS (transactions per second) indicator. Hashgraph is claimed to be an upgrade in transaction speed, cost, and scalability.
Core network services by Hedera:
Consensus Service (HCS). With HCS, clients send messages to the network to negotiate consensus timestamping and order. In this case, the state is stored offline, and users can define privacy and access control.
Hedera Token Service (HTS). Thanks to HTS, token creation and management are available to customers. It supports built-in tokenization.
The goal of Hedera’s hashgraph is to increase the speed of transactions. Moreover, the network is also focused on high-volume operations: micropayments, data integrity and tokenization.
Like the EVM, the Hedera network maintains a virtual machine that writes smart contracts in the Solidity programming language. On top of that, Hedera offers a set of built-in KYC and AML checks.
From a technical point of view, Hedera is a form of distributed ledger technology. It is a hashgraph, or consensus algorithm, where users agree on the order in which transactions should be performed. However, Hedera is not exactly a blockchain. It has its own distinctiveness and works differently. With hashgraph, all transaction branches are merged, no block equivalent is thrown away, and each is used to reach consensus.
One of the most noticeable features of the network is the Gossip-about-Gossip protocol. According to Dr. Leemon Baird, Hedera's inventor, within the system nodes randomly transmit data about themselves to other nodes via hashgraph using the Gossip protocol. Soon, all nodes in a cluster become familiar with each other. Then a certain data structure is formed. It consists of a payload of transactions, a timestamp, a digital signature, and hashes to the previous structures.
HBAR is Hedera's native token that powers applications on the Hedera network. HBAR is utilized to pay for network services, transaction fees, in-app payments and micropayments. Developers can pay network fees with HBAR tokens, namely: work with smart contracts, file storage and currency exchange. HBAR is used to incentivize and pay network nodes.
Hedera Hashgraph has a decentralized governance system that is set apart. All critical decisions about pricing policy, software updates, and wealth management are made by the Governing Council.
Who Are the Founders of Hedera Hashgraph?
Hedera Hashgraph has two founders: Dr. Leemon Baird and Mance Harmon.
Dr. Leemon Baird is credited as the investor of the hashgraph distributed consensus algorithm and currently works as Hedera's chief scientist.
Prior to founding Hedera Hashgraph, Baird accumulated more than a decade of experience in various computer science and security roles and previously worked as a senior research scientist at the Academy Center by Cyberspace Research. He also holds the position of co-founder and CTO at Swirlds Inc., a platform for building DApps.
On the other hand, Mance Harmon is Hedera’s CEO and an experienced technology executive and seasoned entrepreneur. Harmon has around two decades of experience holding executive roles at prominent firms — many of which are in the IT security industry. Like Dr. Leemon Baird, Mance Harmon also holds a second position at Swirlds Inc., as its co-founder and CEO.
In addition to the founders, the Hedera leadership team also comprises more than a dozen individuals, many of which have had distinguished careers.
What Makes Hedera Hashgraph Unique?
Unlike most other cryptocurrency platforms, Hedera Hashgraph isn’t built on top of a conventional blockchain. Instead, it introduces a completely novel type of distributed ledger technology known as a Hashgraph.
This technology allows it to improve upon many blockchain-based alternatives in several key areas, including speed, cost, and scalability. Hedera transactions have an average transaction fee of just $0.0001 USD and typically reach finality in under five seconds. Overall, Hedera Hashgraph claims it can handle more than 10,000 transactions per second (TPS) — compared to the around 5-20 for most popular proof-of-work (PoW)-based blockchains.
The platform offers several major network services. These include:
- A token service that allows users to easily configure and mint both fungible and non-fungible tokens (NFTs) on Hedera with just a few lines of code.
- A consensus service that acts as a layer of trust for any application or network that needs a secure, verifiable log of events.
- Smart contract tools that let developers build powerful and efficient decentralized applications.
- Decentralized file storage services with features include proof-of-deletion, controlled mutability, and time-based file expiry.
How Many Hedera Hashgraph (HBAR) Coins Are There in Circulation?
The Hedera Hashgraph token, HBAR, has a maximum total supply of 50 billion units. Out of this, almost seven billion were in circulation as of January 2021 — equivalent to around 14% of the total supply.
Hedera publishes regular reports detailing when the next wave of HBAR tokens will be unlocked. These reports can be viewed here.
According to Hedera's resources, the two project founders each have a coin grant of two billion HBARs, equivalent to 4% of the total supply each. These tokens are vested over a six-year period.
Other senior executives at Hedera (that joined prior to 2018) have coin grants of between 250 million and 300 million coins. These tokens are vested over a period that ends in December 2021.
According to Hedera's Economics Whitepaper (published June 2020), around 17.03 billion HBAR is estimated to be in circulation by 2025 — equivalent to 34% of the total supply.
How Is the Hedera Hashgraph Network Secured?
Hedera Hashgraph uses a novel consensus system known as Hashgraph consensus to keep its network secure.
This uses a rotating governing council consisting of up to 39 highly diversified organizations that span across up to 11 different industries. These are involved with directing the Hedera codebase, voting on platform decisions and operating the initial nodes on the Hedera public network.
Hedera uses a novel form of proof-of-stake (PoS) which allows HBAR users to stake their resources to help protect the network. Right now, all Hedera nodes are managed by either Hedera itself or the governing council members, but there are plans to switch to a permissionless system in the future.
Overall, Hedera's security setup ensures it achieves "asynchronous” Byzantine fault tolerance (ABFT) — meaning it can guarantee both the timing and order of a set of transactions, even if some data is delayed or lost.
Where Can You Buy Hedera Hashgraph (HBAR)?
HBAR is a popular digital asset that is available to trade on several prominent exchange platforms, including Binance, Bittrex and Huobi Global.
Some of the more popular HBAR trading pairs include HBAR/USDT, HBAR/BTC and HBAR/ETH, and there are also several fiat trading options for the cryptocurrency, including HBAR/USD, HBAR/KRW and HBAR/INR.
For more information about buying cryptocurrencies with fiat, see our comprehensive guide.
AI Analysis
What is the Hedera (HBAR) cryptocurrency good for? What are its main use cases?
Hedera (HBAR) is a cryptocurrency and a blockchain platform that focuses on delivering high-performance, security, and scalability. It utilizes a novel consensus algorithm called the Hashgraph, which is designed to be energy-efficient and fast. Here are some of the main use cases for Hedera (HBAR):
- Decentralized Finance (DeFi): Hedera's high-speed and low-latency platform makes it suitable for DeFi applications, such as decentralized lending, borrowing, and trading.
- Gaming: The fast and secure nature of Hedera's platform makes it attractive for online gaming, particularly for games that require rapid transactions and low latency.
- Non-Fungible Tokens (NFTs): Hedera's platform supports the creation, trading, and storage of NFTs, which can represent unique digital assets, such as art, collectibles, or in-game items.
- Supply Chain Management: Hedera's platform can be used to track and verify the movement of goods, enabling secure and efficient supply chain management.
- Identity Verification: Hedera's platform can be used for decentralized identity verification, enabling secure and private authentication of individuals and organizations.
- IoT (Internet of Things): Hedera's platform can be used to securely and efficiently manage data from IoT devices, enabling various applications such as smart cities, industrial automation, and more.
- Tokenization: Hedera's platform can be used to tokenize assets, such as real estate, art, or other unique assets, allowing for more efficient and secure trading and ownership.
- Stablecoins: Hedera's platform supports the creation and management of stablecoins, which are cryptocurrencies pegged to the value of a fiat currency.
- Cross-Border Payments: Hedera's platform can be used for fast, secure, and low-cost cross-border payments, enabling efficient and reliable international transactions.
- Enterprise Adoption: Hedera's platform is designed to meet the needs of enterprises, providing a secure, scalable, and reliable infrastructure for various use cases, such as data management, authentication, and more.
Overall, Hedera (HBAR) is designed to be a versatile and high-performance platform that can support a wide range of use cases, from DeFi and gaming to supply chain management and identity verification. Its unique features, such as the Hashgraph consensus algorithm, make it an attractive option for developers and organizations looking to build scalable and secure applications.
What blockchain does Hedera use? Is it its own blockchain or built on top of another?
Hedera Hashgraph is not built on top of another blockchain—it operates as its own distributed ledger technology (DLT) with a unique consensus mechanism called Hashgraph.
Key Points About Hedera's Blockchain:
- Native DLT: Hedera runs on its own public ledger (not a blockchain in the traditional sense) that uses asynchronous Byzantine Fault Tolerance (aBFT) for consensus.
- Hashgraph Consensus: Unlike traditional blockchains (e.g., Bitcoin or Ethereum), Hedera uses Hashgraph, a Directed Acyclic Graph (DAG) structure, which allows for high throughput, low latency, and finality in seconds.
- Public & Permissioned Nodes: Hedera is a public network, but its nodes are permissioned (run by approved entities like Google, IBM, and others).
- Smart Contracts & Tokens: Hedera supports smart contracts (via Solidity) and tokens (HTS - Hedera Token Service).
Comparison to Other Blockchains:
- Not a Fork: Hedera is not a fork of Ethereum, Bitcoin, or any other blockchain.
- Different Architecture: It doesn’t use blocks or miners; instead, it relies on gossip-about-gossip and virtual voting for consensus.
Conclusion:
Hedera operates on its own independent ledger (Hashgraph) and is not built on top of another blockchain. It’s a standalone DLT with a unique consensus model designed for speed, security, and fairness.
Would you like details on Hedera’s tokenomics or governance?
Is Hedera programmable? Does it support smart contracts or decentralized applications?
Yes, Hedera is programmable and supports the creation of smart contracts and decentralized applications (dApps). It is a public ledger that utilizes a novel consensus algorithm called hashgraph, which allows for fast, secure, and energy-efficient transactions.
Hedera's programmability is based on the Hedera Smart Contract Service (HSCS), which enables the deployment, execution, and management of smart contracts. These smart contracts can be used to create a wide range of decentralized applications, including:
- Decentralized finance (DeFi) applications: lending protocols, stablecoins, and other financial instruments.
- Non-fungible token (NFT) marketplaces: platforms for buying, selling, and trading unique digital assets.
- Gaming applications: online games that utilize blockchain technology for in-game assets, rewards, and more.
- Supply chain management: decentralized systems for tracking and verifying the origin, movement, and ownership of goods.
Hedera's support for smart contracts and dApps is based on the following features:
- Solidity support: Hedera supports Solidity, the same programming language used by Ethereum, making it easy for developers to port their existing Ethereum-based smart contracts to the Hedera network.
- EVM-compatible: Hedera's virtual machine (EVM) is compatible with the Ethereum Virtual Machine (EVM), allowing developers to deploy and execute Ethereum-based smart contracts on the Hedera network.
- Smart contract libraries and tools: Hedera provides a range of libraries and tools to support smart contract development, including the Hedera SDK, which offers a set of APIs and software development kits (SDKs) for building, deploying, and managing smart contracts.
- Decentralized application frameworks: Hedera supports popular decentralized application frameworks, such as Truffle and Web3.js, making it easy for developers to build and deploy dApps on the Hedera network.
Overall, Hedera's programmability and support for smart contracts and decentralized applications make it an attractive platform for developers and organizations looking to build scalable, secure, and energy-efficient blockchain-based solutions.
How fast are Hedera transactions? What is the typical confirmation time and throughput (transactions per second)?
Hedera transactions are known for their speed and efficiency, thanks to the Hedera network's asynchronous Byzantine Fault Tolerant (aBFT) consensus algorithm, which ensures high throughput and low latency.
Transaction Speed & Confirmation Time
- Typical Confirmation Time: 3–5 seconds (on average, but can be as fast as 1–2 seconds under optimal conditions).
- Finality: Transactions are considered final once they are included in a consensus finalized block, which typically happens within 3–5 seconds of submission.
Throughput (Transactions Per Second - TPS)
- Theoretical Maximum: 10,000+ TPS (as claimed by Hedera).
- Real-World Performance: 5,000–10,000 TPS (depending on network load and transaction complexity).
- Peak Performance: Hedera has demonstrated 10,000+ TPS in test environments, with some benchmarks showing 12,000+ TPS for simple transactions.
Factors Affecting Speed & Throughput
- Transaction Complexity: Simple transfers (e.g., HBAR transfers) are faster than smart contract executions.
- Network Load: During peak times, confirmation times may slightly increase.
- Node Participation: Hedera’s gossip-about-gossip (GaG) consensus ensures fast propagation of transactions across nodes.
Comparison to Other Blockchains
- Faster than Ethereum (15–30 sec avg. confirmation, ~15–30 TPS)
- Faster than Solana (400–65K TPS, but with occasional downtime)
- Comparable to Algorand (~1,000–4,500 TPS, ~4 sec confirmation)
Conclusion
Hedera is one of the fastest public ledgers, with sub-5-second confirmations and 5,000–10,000+ TPS throughput, making it ideal for high-frequency transactions, DeFi, and enterprise applications.
Would you like details on specific transaction types (e.g., token transfers vs. smart contracts)?
How much data can I store on the Hedera blockchain? Does it support on-chain data storage?
The Hedera blockchain supports on-chain data storage, but it's designed to be more efficient and cost-effective for storing small to medium-sized amounts of data, rather than large files.
The Hedera network has a few options for data storage:
- Transaction metadata: You can store small amounts of data (up to 1 KB) as metadata in transactions. This is a good option for storing small amounts of data, such as keys, identifiers, or small messages.
- Consensus-service messages: You can store larger amounts of data (up to 6 KB) in consensus-service messages. These messages are stored on-chain and can be used for storing larger amounts of data, such as JSON objects or small files.
- Off-chain storage: For larger files or datasets, Hedera recommends using off-chain storage solutions, such as IPFS (InterPlanetary File System) or other decentralized storage networks. You can store a hash of the data on-chain, which allows you to verify the integrity and existence of the data without storing the entire file on the blockchain.
It's worth noting that storing large amounts of data on the Hedera blockchain can be expensive due to the network's transaction fees, which are designed to incentivize efficient data storage and prevent spam.
To give you a better idea, here are some estimated costs for storing data on the Hedera blockchain:
- Storing 1 KB of data: around $0.01 - $0.10 (depending on the network traffic and fees)
- Storing 6 KB of data: around $0.06 - $0.60 (depending on the network traffic and fees)
Keep in mind that these estimates may vary depending on the specific use case and network conditions.
In summary, while the Hedera blockchain does support on-chain data storage, it's best suited for small to medium-sized amounts of data. For larger datasets, it's recommended to use off-chain storage solutions and store a hash of the data on-chain for verification purposes.
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