Dallas-based Hedera Hashgraph’s quest to revolutionize the internet took a giant leap Tuesday when the distributed ledger technology became available for testing to the wider public for the first time.
The Community Testing Program allows the public to test the mainnet while earning up to 1,000 hbars in Hedera cryptocurrency, which they can use to read internal articles behind a paywall.
“It’s meant to demonstrate one idea for how you could use micropayment to generate a new type of revenue model instead of a paywall,” Mance Harmon, CEO and co-founder of Hedera Hashgraph, says. “You pay a fraction of a penny to read the article.”
“They’ll be able to create test networks for the first time without having a formal relationship with us.”
This doesn’t require any tech savvy by the user—they just need to log in and create an account, Harmon said.
But, for those who do like to tinker in distributed ledger technology, they can gain access to the testnet to begin testing and building applications at no charge.
“They’ll be able to create test networks for the first time without having a formal relationship with us,” Harmon says.
Harmon, along with co-founder and chief scientist Leemon Baird, started Hedera Hashgraph in August 2017, and have already raised $100 million. Harmon focuses on building the business, while Baird is the computer scientist behind the technology.
Hedera Hashgraph stands apart from other distributed ledger technologies that use blockchain, such as Bitcoin, and even aims to make that technology obsolete.
Hedera boasts a valuation of $6 billion based on the value of competing cryptocurrency platforms.
Why this is important
The onslaught of bad news for tech giants keeps mounting as Facebook, Twitter, and Google go before Congress to testify about data mining, privacy, and bogus accounts sending out sensationalist stories to sway U.S. elections.
Hedera Hashgraph aims to change this culture where people exchange privacy for “free” access.
“Their business model depends on them being able to collect a bunch of information about us and then characterize us as a demographic and sell access to us advertisers,” Harmon says. “They monetize us. We are the product because they’re selling ad space to advertisers.”
“Their business model depends on them being able to collect a bunch of information about us and then characterize us as a demographic and sell access to us advertisers.”
The public is reacting to this now as more news comes out about tech giants spying on the public, including the Cambridge Analytica scandal.
Hedera Hashgraph transforms the business model by using a cyrptowallet loaded with hbars that’s accepted everywhere on the web. It can be used to access articles, download music, access social media or send emails—all in exchange for not being targeted by advertisements.
“They can simply charge a micropayment for the use of the services,” Harmon says. “It’s an alternative revenue model where the consumers are not the product, they really are the customer because they are paying fractions of a penny when they want to use something.”
The standardized payment system would travel across the web, ending the days where users have to create accounts—usually with a credit card—when they want to do business.
“There’s no need for them to know anything about me,” Harmon says. He sees huge potential to disrupt the business model of the existing tech giants. Facebook is already exploring a distributed ledger technology but has been “tight lipped” with the details.
“Unless the tech giants change their policies, change their revenue model, the startups will very likely gain traction and very likely become competitive,” Harmon says. “They see disruption coming.”
Unlimited use cases
By opening up the testnet to developers, Hedera Hashgraph wants developers to flex their wings and create some interesting potential use cases.
Just a few that Harmon has tossed out include changing how we pay tolls on the highway, charging fractions of a penny to send emails to make spamming unprofitable, or having artificial intelligence negotiate with a parking meter before it arrives to settle on a fair price.