Hedera's Path to Decentralization

Our Path To Decentralization
Featuringthe ReleaseSchedule
©2019 Hedera Hashgraph, LLC. All rights reserved.

Dr.LeemonBaird
Co-founder + Chief Scientist 
 
HEDERA HASHGRAPH

To be the most decentralized public network  
at scale in the market
GOAL

hedera.com
©2019 Hedera
Hashgraph, LLC.  
All rights reserved.
2012
LEEMON STARTS
SOLVING FOR
DISTRIBUTED
CONSENSUS  
AT SCALE
2015
HASHGRAPH
ALGORITHM IS
DISCOVERED
2018 2019
HEDERA 
ANNUAL  
ASSEMBLY
FEBRUARY
HEDERA
OPEN
ACCESS
SUMMER
TODAY
2019
2016
2017
SWIRLDS
LAUNCHES FIRST
PRIVATE
PERMISSIONED
NETWORK
HEDERA PUBLIC
LEDGER
CONCEIVED
Our Journey
2018
HEDERA
NETWORK GOES
LIVE
MARCH
AUGUST
2018
HEDERA18
DEVELOPER
CONFERENCE
AND GLOBAL
HACKATHON
OCTOBER
PUBLIC
NETWORK
ANNOUNCED
LEDGER
EXTENDED TO
PARTICIPATING
ORGANIZATIONS
ANONYMOUS
NODES MADE
AVAILABLE TO
ANYONE
2019
COMMUNITY
TEST PROGRAM
PHASE 2
MAY
2019
COMMUNITY
TEST PROGRAM
PHASE 1
JANUARY

hedera.com
©2019 Hedera Hashgraph, LLC.  
Requirements for decentralization
Decentralized 
Governance
Network 
Utility
Permissionless 
Nodes
Currency  
Distribution

hedera.com
©2019 Hedera
Hashgraph, LLC.  
PERMISSIONED PERMISSIONLESS
PRIVATE
PUBLIC
Distributed Ledger Technology (DLT)

hedera.com
©2019 Hedera
Hashgraph, LLC.  
Hedera is on the path  
from public permissioned  
to public permissionless
PERMISSIONED PERMISSIONLESS
PRIVATE
PUBLIC
Distributed Ledger Technology (DLT)

hedera.com
Hedera network is FULLY DECENTRALIZED
if BOTH the following are true:
How Hedera Works
+
Widelydistributedcoins 
(nolargecoinconcentrations)
Permissionless 
(manynon-permissionednodes)

hedera.com
Hedera network is SECURE
if ANY ONE of the following is true:
How Hedera Works
OR OR
+
(Total cap is important, not  
price per coin. Employee coins and  
early SAFTS were 0 or close to 0 ¢/ .
Last SAFT was 9.6 and 12 ¢/ .)
Less 
than1/3
circulating
Not 
permissionless
(manynon-permissionednodes)
Widely 
distributedcoins
Highcirculating 
coincap

Proof-of-work vs proof-of-stake
Scarce resource = computing power
Significant waste of electricity
Slower to reach consensus
Mining pools
MINERS
POWER
STATIONS
Proof-of-workblockchain

Proof-of-work vs proof-of-stake
Scarce resource = computing power
Significant waste of electricity
Slower to reach consensus
Mining pools
Scarce resource = coins
Energy efficient
Faster to reach consensus
No mining pools needed
MINERS
POWER
STATIONS
vs
Proof-of-stakesystemsProof-of-workblockchain

hedera.com
©2019 Hedera
Hashgraph, LLC.  
Decentralized Governance
Hedera governance is decentralized with  
council distributed in geography, industry, and time

HIGH
LOW HIGH
Abilitytomakecomplexdecisions
Trust
numberof
decisionmakers
A governance model where power cannot be consolidated

HIGH
LOW HIGH
Trust
Anarchy 
0
numberof
decisionmakers

HIGH
LOW HIGH
Trust Direct 
Democracy 
ALL
Anarchy 
0
numberof
decisionmakers

HIGH
LOW HIGH
Trust Direct 
Democracy 
ALL
Anarchy 
0
Dictator 
1
numberof
decisionmakers

HIGH
LOW HIGH
Expert 
Council 
SEVERAL
Trust Direct 
Democracy 
ALL
Anarchy 
0
Dictator 
1
numberof
decisionmakers

weak governance  
(if can’t enforce decisions)
HIGH
LOW HIGH
Expert 
Council 
SEVERAL
Trust Direct 
Democracy 
ALL
Anarchy 
0
Dictator 
1
numberof
decisionmakers

hedera.com
©2019 Hedera
Hashgraph, LLC.  
GOVERNING COUNCIL
Runbytheworld'sleadingenterprises

hedera.com
©2019 Hedera
Hashgraph, LLC.  
Governance
Up to 39blue-chip
enterprises and
organizations with  
$10B+ revenue
18unique industries
across 5continents,
touching all major
markets
Every member required
to run a network node
Members not
compensated beyond
network node payments
Governing
Council
2.6%influence per
member (equal vote)
7committees: 
Membership, Marketing,
Finance, Audit, Technical
Steering/Product Pricing,
Legal & Regulatory
3-year maximum 
term, with up to  
2 consecutive terms
First 38additional
members selected by
Hedera Hashgraph; council
membership committee
will find replacements
1
2
4
3
5
8
10
9
6
7
12
13
14
15
1718
19
16
11
20
21
22
23
24
25
26
27
28
29
30
31
32
33
35
34
37
36
39
38

hedera.com
©2019 Hedera
Hashgraph, LLC.  
Technical  
Controls
• No Forks
• Ensures simultaneous  
software upgrade
Hedera’s Strong Governance
Legal  
Controls
• Patents & IP protections
• No license required to use network
• Open code review (after Beta)

We see Hedera providing  
stability for our clients who want
confidence that the ecosystem
they build can’t be ripped in two.
“
SCOTT THIEL
PARTNER 
DLA PIPER

We are proud to  
be an initial
governing member
of the Hedera
Hashgraph Council.
“

Hedera has uniquely thought
through the security,
governance and scalability
that have hampered early
blockchain technology.
“
JOHN CALIAN
SVP, HEAD OF T-LABS

DLTs and decentralized apps
represent a disruptive
opportunity… we are excited
to be members of the
Hedera Governing Council.
“

Nomura is an Asia-
headquartered
financial services
group with an
integrated global
network spanning
over 30 countries.

hedera.com
©2019 Hedera
Hashgraph, LLC.  
Learnmoreandwatchcouncilmembervideosat:
www.hedera.com/council

hedera.com
©2019 Hedera
Hashgraph, LLC.  
Network Utility

hedera.com
©2019 Hedera
Hashgraph, LLC.  
3rd PARTY APPLICATIONS
Cryptocurrency
Smart
Contracts
File
Service
Individuals
Enterprises
Devices
Governments
HASHGRAPH CONSENSUS
MEDIA
LEGAL
HEALTH
GAMING LOGISTICSCOMMUNICATIONS
REAL ESTATE SOCIAL CAUSESFINANCIAL
END USERS
PRIVATE DLT
HEDERA  
GOVERNING  
COUNCIL

PAYABLE LINKS
BUMPED INC.
OLPORTAL.AIGenesisNet
Plugg
1,080+DevelopersonTestnet

Integrate Chainlink’s decentralized oracle network
with Hedera to allow developers writing Hedera-based
smart contracts to access real-world data, events
and payment information.
Buildingthefuturetogether

Enabling superior drug development and patient care
decision-making through model-informed drug
development, regulatory science, real world evidence,
and knowledge integration, thus optimizing R&D
productivity, commercial value, and patient outcomes.

Upload brand assets with Rights Data associated with
the intellectual property on the platform. After
verifying ownership, Rightory assists in embedding
unique rights data and storing that in Hedera. You can
then monetize assets in their marketplace or transact
privately via the Rightory token wallet.

PAYABLE LINKS
BUMPED INC.
Plugg
1,080+
DEVELOPERS
ONTESTNET

PAYABLE LINKS
BUMPED INC.
Plugg
1,080+
DEVELOPERS
ONTESTNET
15,380+
MEETUP 
MEMBERS

PAYABLE LINKS
BUMPED INC.
Plugg
1,080+
DEVELOPERS
ONTESTNET
560+
APPSUNDER
DEVELOPMENT
15,380+
MEETUP 
MEMBERS

PAYABLE LINKS
BUMPED INC.
Plugg
560+
APPSUNDER
DEVELOPMENT
15,380+
MEETUP 
MEMBERS
6,970+
DEVELOPERS 
INDISCORD
1,080+
DEVELOPERS
ONTESTNET

HopOn by Nuvonic is a WiFi Hotspot sharing application
that uses Hedera's Micro-Transactions to charge users
accordingly depending upon the data they use. Data
Rate is set by Internet Provider distributing the
connection with a minimal charge of processing.

A farm-to-table supply chain management solution
with a simple and fast blockchain-powered
platform helping producers and consumers address
key supply chain challenges such as production
efficiency, food safety and authenticity.

Integrating Payable Links with DLTs which support
micropayments and offering a good experience, low
fees and time-effective transactions.
PAYABLE LINKS

hedera.com
©2019 Hedera
Hashgraph, LLC.  
Methodical Path to Permissionless

hedera.com
©2019 Hedera
Hashgraph, LLC.  
Permissioned Council Member Nodes

hedera.com
©2019 Hedera
Hashgraph, LLC.  
Permissioned Council Member and Other Nodes

hedera.com
©2019 Hedera
Hashgraph, LLC.  
Permissionless Nodes

hedera.com
©2019 Hedera
Hashgraph, LLC.  
Security

hedera.com
Security
SYBIL ATTACK RESISTANT
ASYNCHRONOUS BYZANTINE
FAULT TOLERANT
DDOS ATTACK RESISTANT
Hedera hashgraph has the strongest level of security
possible, Asynchronous Byzantine Fault Tolerance (ABFT).
The platform is the only distributed ledger technology
that has formally proven this quality.
Best-in-Class Security
Hedera is Coq Proof confirmed 
“Gold Standard” for security  
by Carnegie Mellon

hedera.com
Asynchronous Byzantine
Fault Tolerance (ABFT)
Enterprise-Grade Security
ABFT offers the highest degree of security a consensus algorithm can provide.
Finality of Consensus
Finality of consensus is reached with probability one. State proofs can
mathematically prove to a third party facts such as balances and file contents.
One-Third Rule
Finality of consensus is reached assuming attackers control less than ⅓ of stake
(in proof-of-stake systems) or ⅓ of nodes (in non-proof-of-stake systems). The
network freezes when ⅓ are offline. These guarantees are still true, even if an
attacker can delay or delete most messages on the network, as long as honest
nodes can still communicate occasionally.
ABFT means that
consensus will
reach finality (with
probability one), that
nodes never reach
contradictory
consensus, and that
this is still true even
if the attacker
controls almost 1/3
and strongly
influences
communication.
Security

hedera.com
DDoS Attack
Gossip Resilience
Gossip is a messaging model that is resilient to any small number of
nodes being taken offline by a DDoS.
Leaderless
Hashgraph does not rely on a leader, ie a particular node having special
privileges towards consensus – consequently a DDoS against one node
cannot compromise consensus.
In a Distributed Denial of
Service (DDoS) attack an
attacker corrupts
thousands of computing
devices (IP cameras etc.)
and uses them to flood an
honest node with packets
and so prevent them from
contributing to
consensus.
Security

hedera.com
Sybil Attack
Proof-of-Stake Systems
Each node has an influence on the consensus, proportional to the amount
of cryptocurrency that it owns.  
An attacker gains no extra influence by creating multiple nodes.
Proxy Staking
A user who isn’t running a node can proxy stake their hbars to a node.
The node’s influence is proportional to both its own coins and those proxy
staked to it by other users. Coins are not bonded or slashed, and can
transfer at any time.
Treasury Coins proxy staked
Initially, all hbars are held in the Hedera treasury, and are proxy staked to
trusted nodes. Over time, the coins are released and become distributed
for decentralization.
In a Sybil attack, a
malicious actor
creates thousands
of nodes in hope of
gaining undue
influence on
consensus or to
manipulate
transactions.
Security

hedera.com
Dual role of hbars
NETWORK “FUEL”
Coins are used to pay  
for network services
Coins are used to reward nodes for  
providing services to the network
Coins enable micropayments
Any distributed ledger can be  
attacked if a malicious actor controls  
>1/3 of voting power
Hedera’s proof-of-stake system uses
coins to weight the votes
Makes it difficult and expensive for a
bad actor to gain control of more than
>1/3 of the voting power
NETWORK PROTECTION
+

hedera.com
Proxy staking
Hedera Treasury
(held by Hedera Hashgraph, LLC)Proxy-staked coins
User
with hbarsProxy-staked coins
*Hedera Treasury staked coins
*
*
*
*
*
*

hedera.com
NodePayment
Node
ProxyStake
User
ProxyPayment
Proxy staking

Node
3rd Party Applications
Transaction
Fees
Node Reward Payments
End Users
Exchange
Hedera Network
Node Node
dapp dappdapp
Proxy
Staking
Payments
Proxy 
Stakers
Lifecycle  
of coins

hedera.com
6.6% 16% 23% 29% 33% 47% 58% 64% 69% 75% 80% 85%% TOTAL COINS RELEASED:
50,000,000,000
(100%)
Initial
Release
YEAR 
1
• The leftmost bar represents the first year, from August 24 2018 to August 24 2019
• The green portion of that bar is the amount released by the first day of Open Access
• The above is the current plan, and may be adjusted by the council
90% 95% 100%4.66%
Network Launch
August 24, 2018
Coinrelease≠Coinsale
15-year release schedule
Estimated % of hbars released by day of open access
% of hbars released to the market by end of each year
YEAR 
2
YEAR 
3
YEAR 
4
YEAR 
5
YEAR 
6
YEAR 
7
YEAR 
8
YEAR 
9
YEAR 
10
YEAR 
11
YEAR 
12
YEAR 
13
YEAR 
14
YEAR 
15
100% 
Released

hedera.com
Released hbars are seen to be concentrated? 
Or low circulating coin cap?
• Security: HBAR concentration has 
NO security problems until anonymous
nodes are allowed
• Hedera should delay anonymous nodes,
not delay HBAR release
• HBAR release helps with the
concentration problem: it lets more
people have hbars
• Sharding can also be delayed until
confident that hbars are widespread,
and hard for a single attacker to buy 1/3.
What if…
YEAR  YEAR  YEAR  YEAR  YEAR  YEAR  YEAR  YEAR  YEAR  YEAR  YEAR  YEAR  YEAR  YEAR  YEAR

hedera.com
Path to decentralization

hedera.com
Decentralized 
Governance
initial
39
revolving

hedera.com
Decentralized 
Governance
Network 
Utility
initial
39
revolving
Increasing
number of
applications
over time

hedera.com
Decentralized 
Governance
Network 
Utility
Permissionless 
Nodes
initial
39
revolving
Increasing
number of
applications
over time
MAINNET:  
council
participating orgs
anonymous
MIRRORNET: 
anonymous
SHARDS:  
one
a few
many

hedera.com
Decentralized 
Governance
Network 
Utility
Permissionless 
Nodes
Currency  
Distribution
initial
39
revolving
Increasing
number of
applications
over time
MAINNET:  
council
participating orgs
anonymous
MIRRORNET: 
anonymous
SHARDS:  
one
a few
many
Released
smoothly over
a long period  
(15 years)

CommunityTestingProgram
PHASEII
May13
200+millionhbarcoinswillbemadeavailable
Signupat: 
hedera.com/portal

hedera.com
!72
• Earn 5 for every 100 testnet transactions from your account
• Download Hedera Java SDK – build your own apps
• Contribute to open-source community SDKs
• Use our open source utilities (github.com/hashgraph):
• Chrome browser extension
• IoS/Android Wallet
• Word Press website plug-in
• Connect your application to the mainnet at Open Access
H E D E R A
DEVELOPER 
TESTNET  
PROGRAM

hedera.com
!73
$30.00
250
Test the
mainnet &
earn up to 
250
• Read articles
• Listen to podcasts
• Watch videos
WWW.DAILYTIMESTAMP.COM
Community 
TestingProgram
PHASEII

hedera.com
!74
Purchase a
star via smart
contracts and
receive 100
SPECIAL THANKS TO 
Dr Nikolaos Siafakas
hash-hash.info
Community 
TestingProgram
FUTUREPHASE 
SmartContracts

Hedera's Path to Decentralization

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Ähnlich wie Hedera's Path to Decentralization

Ähnlich wie Hedera's Path to Decentralization (20)

Mehr von Hedera Hashgraph

Mehr von Hedera Hashgraph (14)

Kürzlich hochgeladen

Kürzlich hochgeladen (20)

Hedera's Path to Decentralization