Hedera Hashgraph (HBAR) Review: The Complete Guide

Investing in cryptocurrencies is the next innovation when it comes to securing your finances. Following the Bitcoin success, competitions began occupying the market, creating the next generations of digital currency.

That’s where Hedera Hashgraph comes in.

In this complete beginner’s guide to Hedera Hashgraph, we’ll talk about everything there is to know about Hedera, from understanding how it works to Hedera predictions and growth. Ultimately, you’ll be able to decide if Hedera Hashgraph is your next investment.

What Is Hedera Hashgraph?

Hedera Hashgraph is a third-generation public ledger that follows the footsteps of its predecessors, Bitcoin and Ethereum.

Essentially, Hedera Hashgraph is a platform that is deemed faster and more secure than the regular blockchain that most cryptocurrencies use. It’s a decentralized public network that a user can occupy to make transactions within a trusted and safe environment.

Hedera uses the concept of distributed ledger technology (DLT) and is designed to follow a certain sequence called a directed acyclic graph (DAG). DLT is a digital system used to record the transaction of assets and is stored in several places at the same time.

Meanwhile, DAG refers to a mathematical graph theory where the “flow” of the data has no directed cycles and doesn’t form a closed loop. Through the use of this concept, Hedera was able to achieve the highest grade of security possible while simultaneously improving their ease of transaction. 

How Did Hedera Hashgraph Start?

This platform was founded on a simple premise —what if anyone at any moment can carve out a world of their own in cyberspace with just a wave of their hand?

Hedera Hashgraph was developed in 2016 by Dr. Leemon Baird. The work started by figuring out how to achieve distributed consensus on a large scale. The first breakthrough was called a hashgraph, a type of distributed ledger that was designed for private implementations.

The company continued to cultivate the concept of hashgraph. Eventually, they capitalized on the key advantages that the hashgraph has over blockchain and entered the cryptocurrency market in 2018. Currently, Hedera manages around four million transactions per day with more than 100,000 accounts on the main net. 

Hashgraph vs. Blockchains

We stated that Hedera’s success was built on the foundation that hashgraph offers better results than blockchains. But how exactly does the two differ?

1. Speed and Efficiency

It all boils down to the capability and speed of hashgraph. Unlike other platforms that are based on blockchains, Hedera Hashgraph doesn’t require compute-heavy proof of work. For comparison, Hedera Hashgraph can process up to half a million transactions per second.

Blockchains process their transactions at a slower rate in order to achieve an acceptable level of security. It can process up to 100 to 10,000 transactions per second, depending on your platform.

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More so, these transactions most likely need massive amounts of energy and heavy bandwidth consumption just to get through. As a result, blockchain-based platforms often charge higher fees for a simple cryptocurrency transaction. 

2. Data Structure

We talked about how Hedera Hashgraph utilizes a directed acyclic graph to record transactions. The data structure of a cryptocurrency platform determines how secure and efficient the transactions will be.

The use of DAG is unique to Hedera and is not a feature of blockchain.

For blockchain-based platforms, transactions are recorded in “blocks.” Blockchain collects sets of information to be put into a block for storage. When that block is filled, another block is created and then chained to the previous one, which forms into a single string of blockchain.

On the other hand, Hedera is architected to process transactions in a parallel way as opposed to serially. It stores data in the form of an event and combined a gossip protocol with virtual-voting. That results in faster data dissemination and quicker transactions.

By using DAG, Hedera doesn’t need to choose between speed and security. Blockchains were originally designed to take their time throughout the process, so security isn’t compromised.

3. Accessibility

Accessibility is another difference between hashgraph and blockchain. Blockchains are widely used by cryptocurrency platforms because they are public. While the blockchain itself isn’t technically open-source, blockchain systems are typically incorporated with an open-source software.

On the other hand, the technology of hashgraph is only accessible via Hedera.

Hedera Coin: HBAR

Ready to invest in Hedera Hashgraph? Well, first, let’s talk about their official cryptocurrency.

The Hedera coin is officially called HBAR. HBARs are the platform’s native cryptocurrency that users can buy and sell, as well as use it on other financial transactions.

The symbol for the Hedera coin is h, which is also a common replacement term for HBAR.

Like any other currency, HBAR has certain scalable denominations. Here’s a handy HBAR conversion for you to get familiar with:

  • 1 Gigabar (Gh) = 1,000,000,000 h
  • 1 Megabar (Mh) = 1,000,000 h
  • 1 Kilobar (kh) = 1,000 h
  • 1 HBAR (h) = 1 h
  • 1,000 Millibar (mh) = 1 h
  • 1,000,000,000 microbar (uh) = 1 h
  • 100,000,000 tinybar (th) = 1 h

As of February 11, 2021, the value of 1 HBAR is under $0.15.

Hedera Staking

There are platforms that allow users to earn additional cryptocurrency by giving contributions to the network. In Hedera, you can earn these rewards by staking.

Staking refers to the process of participating in transaction validation. When staking, you’re essentially locking a certain amount of coins in your wallet for a designated period. In a non-digital currency set-up, staking is similar to time deposits.

Many platforms like Hedera encourage their users to stake some of their HBARs because it helps them stabilize the price of their currency. Hedera’s rewards depend on how much HBAR you staked and how long will you hold them.

Hedera staking is a great practice for those who are just starting on the platform. You don’t need a lot of resources to keep track of your investments. Plus, staking doesn’t necessarily require a lot of crypto knowledge to participate.

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Staking in Hedera isn’t as strict as other cryptocurrency platforms. In other blockchain-based platforms, once you staked a part of your coins, you won’t be able to do anything with it. Your money is essentially locked up until the time elapses.

But for Hedera, account holders will have full control of their staked coins. They aren’t locked up, so when the time comes that you need to spend your coins, you can do so. There are no penalties or consequences from pulling out. However, you won’t receive the corresponding rewards for staking.

So what goes behind staking in Hedera?

Once the account holder decided that they want to stake all or some of their coins, a minimum balance is set for them to qualify for staking. When that balance is met, the HBAR is deposited into the network as a stake.

The network then comes to a consensus on the transaction and updates the involved nodes. At the end of every cycle (each cycle is 24 hours long), accounts that reached their contribution threshold are rewarded by Hedera. Payments are automatically deposited into your wallet.

The extra rewards that you get from the Hedera treasury account scale on the amount that you staked.

You can check out the latest rates and policies of Hedera staking on your Hedera account.

How To Buy Hedera Hashgraph HBAR

Now that you know what goes on behind Hedera Hashgraph let’s talk about finally making your investment decision through HBAR.

Before you purchase HBAR, you have to create your own Hedera wallet first. Follow these quick and straightforward steps to get started with Hedera:

Choose Your Hedera Wallet/Exchange

Hedera Hashgraph has partnered up with third-party wallet and exchange providers that allow account holders to purchase, sell, and manage their HBAR cryptocurrency.

Here’s a full list of third-party wallets and exchanges where you can buy HBAR:

Exchanges:

Wallets:

  • For the fastest and best experience, and HBAR account creation, Hedera HBAR is available for purchase on select crypto exchanges, and we highly recommend Changelly and Binance.
  • We also recommend using third-party wallet providers such as Atomic Wallet or BRD. As an alternative and more secure solution, check out the hardware wallets from Ledger.

Each third-party wallet or exchange has its pros and cons. Some wallets and exchanges are more beginner-friendly than others in terms of user interface and tutorials that can help first-time users set up their accounts. We highly recommend taking the time to look through these wallets and exchanges to find the best fit for you.

Read our in-depth reviews:

Binance

Changelly

Ledger Nano S

Ledger Nano X

Hedera Hashgraph also has its own Hedera Wallet app available on iOS and Android (not recommended). Follow this guide to set-up your Hedera Wallet account.

Set-Up Your Hedera Wallet Account (Not Recommended)

On your mobile browser, log-in to portal.hedera.com. Create your account by providing your email, password, country of residence, and country of citizenship.

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Hedera Hashgraph requires a Know Your Customer (KYC) verification before you proceed. Complete the form, then press “Continue” to download and link your Hedera wallet.

Once you’ve downloaded the app, follow these steps:

  • Select “Create a new wallet.”
  • Hedera will provide you a 24-word backup phrase. It is IMPORTANT that you properly document this passphrase. Don’t share this passphrase with anyone.
  • Then proceed to enable authentication. You can choose anything from fingerprint, FaceID, pin, and more.
  • Once you’ve completed these steps, you’ll be redirected back to the Hedera Portal in your mobile browser. Then, you’ll see your account ID displayed in the box.
  • Copy the account ID (format is X.X.XXXX where each corresponds to a number), then go back to the Hedera Wallet app.
  • Go to your sidebar menu and select “Default Account.” Paste your account ID to the “Account ID” field to link your wallet to your Hedera account.
  • Once you’ve completed the steps, go back to your Hedera portal on the mobile browser and select “I’ve Paired My Account.”

And you’re all set! Your Hedera Wallet is now properly linked for you to do your HBAR transactions. Make sure that you don’t share your passphrase or authentication pin with anyone. It’s also crucial that you don’t lose your passphrase!

Manage Your HBAR Transactions

Now that you have your wallet all set, you can now start to purchase HBAR. You can do so by depositing funds into your Hedera Wallet.

Check out your Hedera Wallet to monitor the daily prices of HBAR. Your rigor will depend on your crypto strategy. Keeping an eye on Hedera’s latest progressions will help you make sound financial decisions!

Hedera Hashgraph’s Future Growth

The cryptocurrency world is an exciting venture.

But considering that you’re dealing with your money, you would want to know if Hedera is something that you would invest in short-term or long-term. Aside from investments, you should also consider how Hedera can possibly change the way you look at digital payments for your day-to-day transactions.

Since Hedera went public with their cryptocurrency and the use of hashgraph in place of traditional blockchains, the platform shows promising growth.

Currently, Hedera has already had several dozens of clienteles using the platform for their business transactions. These companies are stretched across different industry sectors —from healthcare and wellness up to agriculture and finance.

Hedera generates over an average of 1.4 million transactions per day on the main net. This surpasses the numbers of Ethereum blockchain.

Considering how Hedera brought a new factor to the traditional blockchains used in other cryptocurrencies, we can only imagine the potential that this platform has. It’s a relatively young crypto compared to past generations, but its industry reach is already quite vast.

Currently, the governing council of Hedera has issued a total of 50 billion HBARs to be circulated within their platform. These coins are to be gradually released to the market within 15 years.

So is Hedera Hashgraph your next cryptocurrency?