Hedera council moved to buy hashgraph IP and open-source the code

Hedera’s Governing Council announced on January 19, 2022 that it had voted to purchase the intellectual-property rights to the hashgraph consensus algorithm from Swirlds, the company that created it, and committed to release the code under the Apache 2.0 open-source license during 2022.

The decision was material because Hedera’s consensus design sat behind a public distributed ledger and its HBAR token, yet the algorithm had remained patented. Moving the rights to the council and promising an open-source release addressed a basic institutional question: who controlled the network’s foundational technology, and under what terms could outsiders inspect, reuse and contribute to it?

From open review to open source

Hedera’s earlier white paper described a more restrictive arrangement. Swirlds owned the hashgraph intellectual property, while the Hedera council held a license to use it for the public network. The paper described the codebase as “open review,” meaning outsiders could read and verify it, while patent rights were intended to prevent a competing platform and currency from forking the code.

The January 19 announcement proposed changing that legal architecture. Apache 2.0 is a permissive open-source license, so the commitment went beyond merely publishing readable source. Hedera said broader access could expand community participation and the pool of contributors to the consensus layer.

The event-day record still requires precise wording. The council said it had voted to purchase the rights and would make the code open source during 2022. The announcement did not say that the relicensing had already been completed on January 19, and it did not disclose a purchase price. This was a verified governance decision and forward commitment, not proof that the full transition was finished that day.

Governance changed, but did not disappear

The council paired the intellectual-property decision with an organizational restructuring. It said Hedera Hashgraph’s development and management personnel would move to Swirlds; the Hedera chief executive and chief scientist positions held by Mance Harmon and Leemon Baird would be dissolved; and the council had agreed to outsource several essential services to Swirlds for the foreseeable future. Baird would remain co-chair of the council’s technical committee through Swirlds.

Those moves separated the council’s governance role from much of the day-to-day development organization, but they did not make Hedera permissionless in every respect. The council remained responsible for network governance and treasury decisions, and its members operated the consensus nodes. Contemporaneous coverage counted 25 council members and noted that public participation in the network did not mean unrestricted node operation.

Hedera also said its network code had reached version 1 and would leave beta with the next mainnet upgrade. That was a release plan, not evidence on January 19 that the upgrade had already activated.

Why the decision mattered

The open-source commitment reduced a visible difference between Hedera and public cryptocurrency networks whose core protocol implementations were already developed under open licenses. It could make independent examination, outside contribution and reuse easier. It did not, by itself, establish broader node access, faster adoption, greater token value or more decentralized control.

Hedera said technical controls were sufficient to keep the network state from splitting, making patents unnecessary as a defensive anti-fork mechanism. That was the council’s contemporaneous technical claim. The January 19 materials did not provide an independent test of that assurance, and open-source licensing should not be confused with a guarantee that one live network can never divide socially or operationally.

As of January 19, the defensible conclusion was narrow but consequential: Hedera’s governing body had chosen to replace proprietary control of its consensus algorithm with a planned open-source model while reorganizing the institutions responsible for developing and governing the network.