Forkast.News is now Forkast Labs

Mance Harmon on Why Hashgraph is a Better Alternative to Blockchain (Part I)

Contributor Website Inserts ManceHarmon

Key Highlights

  • Hashgraph is an alternative to blockchain
  • Hashgraph optimizes both security and performance

Listen to the full podcast version of this interview

Transcript of Part I

In conversation with Mance Harmon, Co-Founder and CEO of Hadera Hashgraph, and also a course director for cyber security at US Air Force Academy. He’s also a Program Director for the Missile Defense Agency. Twenty years of strategic thinking as a technology executive in this space — really seeing the evolution of technology as it applies today. And here we are in the Pioneer days would you say, of blockchain, but now Hashgraph, which is not blockchain. Explain.

Correct. So, Hashgraph is an alternative to blockchain. It solves the same category of problems that blockchain solves. But it does so in a far more efficient and secure way, so the performance of Hashgraph is fantastic. Better by orders-and-orders of magnitude than blockchain. And the security of Hashgraph actually achieves the theoretical limit of what can be achieved in the whole category of distributed consensus.

And that’s really the value of Hashgraph. The value of Hashgraph is that it both maximizes the level of security while maximizing performance, and that’s unique in the industry. Everything else in the industry, there’s been this trade-off between performance and security. Public DLTs, better security, worst performance. Permission DLTs, better performance, worse security. Hashgraph maximizes both. 

And for those who are watching from the mainstream side, the global audience who’s groaning, right now because they’re thinking I just learned about blockchain now I have to learn about a completely different thing, Hashgraph. Isn’t that something that we see in social media language, but you’re talking about something that is really an evolution as part of this technology evolution that we’re seeing.

Yeah, well, the whole category was sort of created by blockchain. Ten years ago, Bitcoin was introduced to the world. And that is just a next evolution of database technology. 

Databases have been around for decades. The assumption has always been, there’s one company running all the databases for the company. Google would never assume or presume to give Apple or Tencent, or you name it, a copy of their database and let them run it for them. 

What was demonstrated with Bitcoin is that for the first time, we could have copies of the database being given away to different parties that maybe are mutually competitive, maybe they’re unknown to each other. But you could do so and do it securely in a way that wasn’t previously possible. And so it’s really an evolution of database technology. But if you think about the current performance of Bitcoin for example, and think of it in terms of a database…

In terms of the consensus cycle?  

Exactly. It can only process about seven transactions per second globally. That’s a pretty slow database. There’s not that many things you can do with the database that can only process seven transactions per second. 

What Hashgraph makes possible for the first time in a public network, like Bitcoin, is the ability to process tens of thousands of transactions per second. With our beta release coming this summer, and after we’re fully optimized, we’re expecting 100,000 transactions per second. So, that’s a game changer.

It’s a game changer internally in the industry. But when you’re asking Visa, Master Card, and American Express, and they make transactions of north of million per second, how does that equate in terms of practicality and utility?

Yeah, it’s interesting you would think that that’s the case. It turns out that their systems on average collectively are processing somewhere between 50 and 60,000 transactions per second. And so it’s actually possible now, with public DLT in Hashgraph, to build a system that processes as many if not more transactions per second as the large credit card networks can process. And it clears or finalizes those transactions in the same amount of time, within a few seconds. 

Where with Bitcoin, if I go in and want to pay for a coffee from Starbucks with Bitcoin, the merchant that’s receiving my coin can’t be sure that that coin isn’t going to disappear for an hour. It takes about an hour for them to know that that coin is going to be there permanently. Well, that’s a problem as well. And with Hashgraph, we can provide that certainty within just a few seconds.

So, the Hashgraph, this public DLT that we’re building, absolutely could process the same volume of transactions that the current credit card networks can process. 

Keep Watching

Part I: Mance Harmon on Why Hashgraph is a Better Alternative to Blockchain
Part II: The Advantages of Not Being Open Source
Part III: How Hedera Hashgraph Will Spend $100M
Part IV: How the U.S.-China Trade War Impacted Hashgraph
Part V: When Will We See Real-World Solutions?
Part VI: Can Hashgraph Co-Exist With Other Blockchain Players?
Full Interview: In Conversation with Mance Harmon