What Is HBAR And Should It Be in Your Crypto Portfolio?

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HBAR Key Takeaways

Hedera Hashgraph (HBAR) is a decentralized public network that operates on Distributed Ledger Technology (DLT), enabling users to create and manage decentralized applications (dApps).

It utilizes a directed acyclic graph (DAG) called Hashgraph for achieving consensus, which purportedly offers high throughput, low latency, and fairness in transaction ordering.

The network employs a governing council comprising well-known enterprises from various industries, aimed at ensuring decentralization and stability.

What Is Hedera (HBAR)?

Hedera Hashgraph (HBAR) is a decentralized public network where developers can build secure, fair, and fast applications. It uses a technology called hashgraph, which is a distributed ledger technology (DLT) that claims to provide high throughput, low latency, and secure consensus without the need for a proof-of-work system like Bitcoin’s.

The project aims to address several key challenges faced by existing blockchain platforms, including scalability, security, and fairness. By utilizing the hashgraph consensus algorithm, which offers high throughput and low latency, Hedera seeks to provide a platform capable of supporting a wide range of decentralized applications (dApps) with fast transaction speeds and minimal fees.

How Does Hedera (HBAR) Work?

Hedera Hashgraph (HBAR) works differently than many other cryptocurrencies like Bitcoin or Ethereum. Here are some key points to understand how it functions:

Public Ledger: Hedera is a public ledger, meaning it’s a distributed database of transactions accessible to anyone. Each node in the network maintains a copy of the ledger, ensuring security and decentralization.

Hashgraph Consensus: Unlike blockchains, Hedera uses a technology called hashgraph for consensus. Instead of miners competing to solve blocks, nodes “gossip” about transactions with each other, allowing them to reach an agreement on the order of transactions efficiently and quickly. This results in faster transaction speeds and lower fees compared to blockchains.

Proof-of-Stake: Hedera employs a proof-of-stake (PoS) consensus mechanism. Instead of mining, users can stake their HBAR tokens to secure the network and earn rewards. This reduces energy consumption compared to proof-of-work protocols used by Bitcoin and Ethereum.

Key Features:

Fast Transactions: Transactions are finalized in seconds, unlike blockchains which can take minutes or even hours.
Low Fees: Transaction fees are typically less than a penny, making it suitable for micropayments.
Scalability: The network can handle high transaction volumes without slowing down.
Security: Hashgraph technology and PoS mechanism ensure a secure and resistant network.

Hedera (HBAR) Token And Tokenomics

HBAR is the native cryptocurrency of the Hedera network. It has two main roles:

Transaction Fees: Users pay HBAR for transactions and network services like smart contract execution and token creation.

Securing the Network: Staked HBAR helps secure the network and participants earn rewards in proportion to their stake.

Token Details

Total Supply 50,000,000,000 HBAR

Circulating Supply 33,680,377,930 HBAR

Current Price $0.1121

Market Capitalization $3,776,595,460

The total supply of HBAR is 50 billion tokens, of which 33.68 billion are currently in circulation. The remaining tokens are locked up in various vesting schedules, such as for the Hedera Governing Council, the Hedera Foundation, and ecosystem development.

This information is current as of February 28th, 2024. Please note that the token’s price, market value, and available supply may fluctuate.

The following is a breakdown of the HBAR token allocation:

32.41%: Hedera Pre-Minted Treasury: This reserve is managed by the Hedera Governing Council and used for various purposes, including ecosystem grants, marketing, and governance initiatives.
17.40%: SAFTs & Purchase Agreements: These were early sales to strategic partners and investors who helped launch the network.
23.99%: Ecosystem Development: This pool funds grants and programs to attract developers and build the Hedera ecosystem.
7.96%: Swirlds: This allocation goes to Swirlds, the company that developed the Hedera Hashgraph technology.
7.96%: Founders: This allocation belongs to the founders of Hedera.
4.44%: Employees: This allocation incentivizes and rewards Hedera employees.

Where Can I buy Hedera (HBAR)?

Hedera (HBAR) is available on several cryptocurrency exchanges:

Coinbase: A popular and user-friendly exchange that allows you to buy cryptocurrencies with various payment methods, including bank transfers, debit cards, and wire transfers.

Binance: Another major exchange with a wide range of cryptocurrencies, including HBAR. Binance offers multiple ways to buy crypto, including using credit cards, debit cards, and peer-to-peer (P2P) trading.

KuCoin: A smaller exchange is known for its competitive fees and support for a large number of cryptocurrencies.

Please note that availability may vary depending on your location and the regulations in your country. Always make sure you are using reputable and secure exchanges when buying cryptocurrencies, and consider storing your HBAR tokens in a secure wallet for added security.

Still struggling to find HBAR? Head over to CoinMarketCap, search for “Hedera (HBAR),” and explore the “Markets” tab. This will reveal a list of exchanges where HBAR is actively traded, allowing you to compare options and find the one that best suits your preferences.

Is Hedera (HBAR) A Good Investment?

Whether Hedera (HBAR) is a good investment for you will heavily depend on your investment goals and risk tolerance. Here’s a quick overview:

Pros:

Unique technology: Hedera uses a hashgraph consensus mechanism, which is different from the proof-of-work or proof-of-stake mechanisms used by other cryptocurrencies. This technology has some potential advantages, such as faster transaction speeds and lower energy consumption.

Strong partnerships: Hedera has partnerships with a number of large companies, such as IBM, LG, and Boeing. These partnerships could help to drive the adoption of the Hedera network and increase the value of HBAR.

High speed and scalability: Hedera utilizes a hashgraph consensus mechanism, which promises faster and more scalable transactions compared to traditional blockchains. It currently boasts over 10,000 transactions per second (TPS) with room for further growth.

Cons:

Centralized governance: While Hedera aims to become permissionless in the future, the current Governing Council holds significant control over network participation and decision-making, raising concerns about decentralization.

Limited ecosystem: Despite its potential, the Hedera ecosystem is still young with a relatively small number of decentralized applications (dApps) compared to established platforms like Ethereum.

Competition: Hedera faces stiff competition from other platforms like Ethereum, Cardano, and Solana, each with its own strengths and established user bases.

Ultimately, investing in this asset class is inherently risky. Do your own research, understand the risks, and never invest more than you can afford to lose.

Final Thoughts

Hedera Hashgraph (HBAR) stands as a promising entrant in the realm of decentralized networks, offering a unique approach to achieving consensus and powering decentralized applications (dApps). With its Hashgraph technology, HBAR boasts high throughput, low latency, and secure transaction processing, making it an appealing option for developers and users alike.

While HBAR presents unique opportunities with its innovative technology and strategic partnerships, investors should conduct thorough research, stay informed about market dynamics, and be prepared for the inherent volatility of the cryptocurrency space.