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Hedera runs a public ledger in which transactions are ordered by the hashgraph consensus algorithm. HBAR is its native cryptocurrency, used to pay network fees and support the stake-weighted consensus system. Its distinguishing feature is the combination of open application access with a permissioned set of consensus-node operators.
That distinction matters more than a headline transaction-speed claim. The public network is open to any application builder. Owning HBAR, however, neither makes a holder a Council member nor grants an open-ended right to run a consensus node on mainnet. Hedera separates those roles deliberately.
Who created Hedera, and who runs it?
Hedera's founders are Mance Harmon and Leemon Baird, the inventor of the hashgraph algorithm for consensus. Hedera's mainnet existed before its public opening, with Open Access beginning on September 16, 2019. Early financing included agreements for future tokens, and HBAR distributions followed several schedules rather than a proof-of-work mining launch.
A legal entity operating under published rules lets the Hedera Council govern both the network and its treasury. Under that framework the Council can have as many as 39 members, drawn from a range of organizations and regions. Council members have governance and technical responsibilities, including operating nodes. The number of permitted Council seats should not be confused with the number occupied at any particular time.
This model gives users identifiable institutions responsible for network decisions. It also concentrates admission and governance powers in a selected group. A geographically varied Council can distribute operational responsibilities without creating the same participation model as a network where anyone meeting technical requirements can become a validator.
How hashgraph reaches agreement
Conventional blockchains organize transactions into linked blocks. Hashgraph instead uses a directed acyclic graph, a structure that records how information passed between nodes. Each node passes along events that hold transactions together with references back to previous events. Because the graph preserves information about previous communications, nodes can work out what other participants know.
This is the basis of “gossip about gossip” and virtual voting. Nodes calculate agreement from the shared communication history rather than sending a separate message for every vote. The result is an agreed transaction order and consensus timestamp without competitive mining. For the broader distinction between mining and stake-based security, see proof of work versus proof of stake.
Hedera describes the algorithm as asynchronous Byzantine fault tolerant. Its guarantees depend on assumptions about honest participation and eventual message delivery, including more than two-thirds of the relevant consensus weight following the protocol. “Asynchronous” does not mean a disconnected network can process transactions forever without communication.
Transactions normally reach finality within seconds. Finality means the network has settled their order; it does not mean a transaction was economically sensible or that an application cannot contain a bug. Published throughput also needs context: a native transfer, a message submission and a complex smart-contract call consume different resources.
What HBAR pays for
HBAR pays fees for Hedera services. These include transfers, token creation and management, smart-contract execution, and message ordering through the Consensus Service. An application can use the network's native services instead of implementing every function inside a general-purpose contract.
The Token Service supports fungible tokens and nonfungible tokens. Those assets are separate from HBAR and may have their own supply, administrative permissions and commercial risks. The Consensus Service provides ordered, timestamped messages, which can support an application's audit trail. Recording a message establishes what was submitted and when, not whether a real-world statement in that message was true.
Developers can also deploy Solidity smart contracts on Hedera and use tools built for Ethereum. That compatibility lets them work with familiar tooling, yet Hedera remains a separate network with its own execution model, account system and infrastructure. Our Ethereum profile explains the separate network and its native asset, ETH.
Network fees are denominated in US dollars and paid in HBAR using the network's conversion rate. This gives applications a more predictable dollar-based charging framework than fees expressed only as a variable token amount. It does not make HBAR's market price stable, and different operations can still have different costs. The transaction-fee guide explains why the amount quoted for a simple transfer cannot represent every application action.
Supply, treasury releases and staking
Hedera began with 50 billion HBAR created at network launch. Its Council's Treasury Management report, presenting data as of October 6, 2026, still identifies that total. The report states that changing total supply requires unanimous Council consent under the governing agreement. Describing the supply as fixed should include that governance qualification rather than suggesting no change is conceivable.
Creating the supply and releasing it are different events. Treasury holdings have financed development, governance, operations and ecosystem programs. The Council distinguishes allocated, unallocated and released supply, and explicitly does not define a single circulating-supply measure. A transfer out of Council control can count as released without matching every market-data provider's definition of circulation.
Hedera has a native staking program in which an account stakes the HBAR it holds to a chosen node while keeping full use of the coins. The program has no native bonding lockup or slashing. Staking contributes to consensus weight, but it does not grant the staker the Council's governance powers.
Rewards depend on program conditions, node status, available reward funding and a maximum rate set through Council processes. They are not an automatic fixed return. The documentation also warns that pending rewards can be affected by node removal and that collection looks back only a limited period. A third-party staking product can introduce additional custody or contract conditions beyond the native program.
Open-source development and current status
Hedera remains an active public network as of October 18, 2026. In September 2024 came a major structural change: Linux Foundation Decentralized Trust received Hedera's codebase as a donation, and it now continues there as Hiero. The project covers core network software and associated tooling, allowing development under a neutral open-source organization.
Hiero and Hedera are related but different. Hiero is the software project; Hedera is a live public deployment with its own Council, treasury and operating rules. Opening code development does not automatically open membership in the public network's consensus-node set.
The distinction also helps interpret announcements. A software contribution or interoperability experiment can expand what developers can build without establishing that every proposed feature is deployed on mainnet. For users, an operational status notice and a deployed release matter more than a broad development roadmap.
Where the main risks sit
Hedera's risks span governance, applications and token economics. Council-controlled admission and upgrade decisions create institutional dependencies. Treasury releases can change the amount available outside Council control even when total supply is unchanged. Strong transaction counts can reflect particular applications and do not alone establish diversified demand or sustainable fee income.
Application users also face stolen keys, malicious tokens, contract vulnerabilities and service outages. Native token permissions deserve attention: an issuer's ability to freeze or administer an asset is different from the network's consensus guarantees. HBAR itself has market and liquidity risk, regardless of whether an application prices its service fees in dollars.
The useful way to assess Hedera is to examine these layers separately: who orders transactions, who changes network policy, what an application can control, and why that application needs HBAR. Hashgraph addresses agreement over a ledger. It cannot answer all of those other questions on its own.