Hyperledger and Ethereum are the two most prominent and widely-used open-source blockchain platforms today. They each have their unique real-world applications and help solve a wide range of complex industry-level problems.
This article intends to shed some light on the differences between Ethereum and Hyperledger in terms of operations, consensus, use cases, and more.
Ethereum is basically an open-sourced platform. This platform is mainly used for decentralized applications. enabled by blockchain, Ethereum has wide applications in securing digital agreements and ownership transactions.
Ethereum also stands as the second largest stake in the cryptocurrency world, just behind Bitcoin.
The Ethereum blockchain has an Ethereum Virtual machine which can be categorized as a canonical state of the computer. Every node on the network agrees with this single machine, maintaining a copy of its state as this is a public and decentralized platform. This means that, in every Ethereum transaction, if a new block is added, it immediately is also added to the global copy of the network as well.
Hyperledger, on the other hand, is a collaborative technology that is open-sourced and can be used to create, develop and distribute ledger frameworks that will aid in the acceleration of cross-industry blockchain technology development for enterprises.
Now that we have a basic idea of what Ethereum and Hyperledger are, let us dive into what the major differences between these two are.
Ethereum and Hyperledger vary in their basic purpose itself.
Ethereum is an open-source decentralized platform made for direct use by the consumer by running smart contracts on the Ethereum Virtual Machine.
On the other hand, Hyperledger focuses on Business to Business and cross-industry applications. They work on Distributed Ledger Technology and allow various industries to collaborate with developers and create customized blockchain apps.
Since Ethereum is an open-sourced network open to the public, they are transparent and can be easily accessed by anyone.
But unlike Ethereum, the hyper ledger is highly secure, confidential, and can only be accessed by organizations or individuals with authorized permission.
Ethereum is an in-house development and was founded by its main developer Vitalik Buterin. Rather than by collaboration, Ethereum is governed solely by its developers.
While Hyperledger is governed by the Linux Foundation, it is also a collaborative effort by IBM who is also a major contributor to the framework.
Since Ethereum is a public network anyone in the general public, with access to an internet connection, can download and mine Ethereum.
Only authorized members with permission can use the technology and tools. This protection is due to the confidential information the technology holds and to prevent third-party manipulation.
Ethereum strictly uses solidity to write smart contracts. But Javascript, python, and such are used to develop applications.
Along with Java and Javascript, the language Go is used widely in Hyperledger.
A proof of work consensus mechanism is employed in Ethereum transactions. This is to make sure there are no fraudulent practices like fake transactions or double-spending.
But there are no consensus mechanisms in Hyperledger transactions owing to the fact that it is a private permissioned network.
Ethereum sports a lower transaction speed owing to the Proof of Work mechanism, which will come up to around 20 transactions per second.
But relatively, Hyperledger has a faster transaction speed as there is no consensus mechanism involved.
Ethereum is involved in mining and has its own native cryptocurrency called ETHEREUM (ETH).
On the other hand, there is no mining or cryptocurrency involved in Ethereum.
The above section might have cleared up the major differences between Hyperledger and Ethereum. Now we can move on to the major applications and uses of these two.
If one is planning on creating an app with the intention of public use, Ethereum is to be your first choice as it allows anyone to join the network.
Ethereum is also a great option if you are planning for an open source application with short or no demand for confidentiality.
Private data of an institution shouldn't be available in the public domain. Keeping this in mind, for the development of private applications requiring blockchain technology, hyperledger is your best bet.
If a business is looking to define its blockchain algorithms, Hyperledger is the way to go. This is owing to the modifiable nature of the underlying blockchain infrastructure. This flexibility also allows for more scalability for your business.
Hyperledger is an open-source collaborative project hosted by the Linux Foundation. Hyperledger offers various blockchain frameworks for enterprise solutions. Unlike public blockchain, Hyperledger focuses on private and permissioned networks that are designed specifically for business use. It also provides modular architecture that allows organizations to customize blockchain solutions according to their specific business needs.
The main difference between Hyperledger and Ethereum is that Ethereum is a public blockchain platform that focuses on cryptocurrency and smart contracts, while on the other hand, Hyperledger is a private and permissioned framework designed specifically for enterprise use. Ethereum requires crypto (ETH) for transactions, while Hyperledger doesn't have any native cryptocurrency. Hyperledger provides more privacy and control over who can participate in the network than other blockchain platforms.
Hyperledger's private and permissioned nature provides additional security advantages to the Ethereum public blockchain model. Ethereum relies on consensus and cryptographic security, while Hyperledger offers control access, identity management, and advanced privacy features. You can choose Hyperledger or Ethereum based on your specific security requirement and use case.
Yes, it is possible to integrate Hyperledger and Ethereum together through a solution like Hyperledger Besu, which supports Ethereum compatibility. Organizations or businesses can leverage both platforms' strengths by creating a hybrid solution that combines Ethereum's public network capabilities with Hyperledger's private, permissioned feature for enterprise applications.
Yes, Hyperledger generally offers better scalability than Ethereum due to its private, permissioned nature and consensus mechanisms. Ethereum blockchain processes about 15–30 transactions per second on its blockchain network, while the Hyperledger framework can generally handle 1000 transactions per second. These make Hyperledger more scalable and suitable for enterprise operations.