Algorand Review: Is Algo the Future of Finance?
Algorand is a project that has rocketed onto the scene and firmly cemented itself into the top 100 shortly after its highly anticipated launch. There has been intense interest in this project not only from the crypto community but also from governments, institutions, and academic circles.
The Algorand network has been touted as one of the most advanced blockchain networks ever created. As a result, it has attracted a lot of attention, backed by VC capital and a team of PhDs and professors. The team behind Algorand has set out to do something that has not been possible with blockchain technology to date: to create an infinitely scalable network and solve the blockchain trilemma once and for all.
In this Algorand review, I will give you everything you need to know about the project, some exciting protocols building on it, and cover the team and the tokenomics.
Disclaimer: I hold the ALGO token as part of my personal portfolio.
What is Algorand?
Algorand is a layer one decentralized blockchain-based network that supports smart contracts and multiple applications. The project aims to create a borderless economy through its decentralized, permissionless public ledger. Other layer one smart contract networks include Ethereum, Cardano, Eos, Tezos, Solana etc.
The Algorand network is highly secure, scalable, lightning-fast and cost-efficient, as all good protocols should be. Algorand has already seen adoption from millions of users worldwide. As Algorand has many benefits over Ethereum, many Algo enthusiasts feel that the future of finance will be built on Algorand.
Algorand launched in 2019 and is capable of supporting some of the most advanced smart-contract functionality in crypto. While a relatively new network, Algorand already has a budding DeFi, NFT, and Web3 ecosystem and is showing impressive growth.
It isn’t just the advanced technology behind Algorand that contributes to its popularity and adoption. The team places a firm emphasis on being “green” and is one of the most eco-friendly blockchain networks. Developers concerned about the impact of blockchain technology on the planet are likely to be drawn to projects like Algorand for their responsible approach to sustainability.
Algorand reached the status of not only being carbon neutral but took it to the next level and became carbon-negative in 2021, which is a truly impressive feat.
Part of Algorand’s success regarding rapidly increasing developer activity is due to developers being able to build on the network using the Python coding language. Python is one of the most popular and well known coding languages used for many projects outside of the blockchain, which opens the door for global developer adoption and collaboration.
In July 2023, the company announced that its decentralized lending protocol, Algofi, would close shop at the end of the year.
A confluence of events has taken place that no longer makes building and maintaining the Algofi platform to the highest standards a viable path for our company. This is obviously not the outcome any of us on the team or in the community hoped for at the outset of this project. (Source)
Effective Sept. 1, collateral factors of ALGO, vALGO, STBL, USD Coin, USDC, goBTC, and goETH markets on both Algofi V1 and V2 were reduced from around 80% to 0% by the beginning of December. The current liquidity mining programs will be “halted and no future proposals will be enacted,” the company said. The Algofi protocol had $25 million in total value locked at the time of publication, down from its $135 million peak in February.
According to DefiLlama, Algofi's total value locked reached a peak of a little over $134 million in February. The protocol is currently in withdrawal-only mode.
The Blockchain Trilemma
The Blockchain Trilemma was a term first coined by Vitalik Buterin. It proposes three main goals that developers should strive to meet when building a blockchain network. Still, no team has been able to find a good balance between all three, as one has to be sacrificed for the other two. According to the trilemma, a blockchain network should be:
- Decentralized: Blockchains distribute control over the network equally to all participants rather than being managed by a single entity.
- Secure: Blockchain networks should have ironclad defences that prevent malicious entities from taking over.
- Scalable: Blockchains should support an enormous number of transactions and users without faltering by increasing fees and transaction times.
Algorand may be the first network to overcome this.
Scalability has been the biggest hurdle for blockchains, as we have seen in the form of the insanely high Ethereum gas fees and the congestion that caused the Cardano network to slow down after the launch of SundaeSwap. Ultimately, scalability troubles were also one of the factors that led to some of the recent issues faced by Solana and why Avalanche users experienced fees creeping above the $10 mark for complex transactions.
Yes, scalability has turned out to be blockchain’s Achilles heel. One of the few networks that have scaled incredibly well has been the Binance Smart Chain, but to achieve scalability, they have to be about as centralized as a network can be, going against the ethos of what crypto is all about. In addition, many projects feel that scalability can’t be at the expense of decentralization and security.
How Algorand Resolved the Trilemma
The team behind Algorand has managed to create a decentralized, highly secure, scalable network while also building a network with some of the lowest fees among any decentralized layer-1 protocol.
We will cover the team later in the article, but the genius behind Algorand is largely due to Silvio Micali, a professor at the Massachusetts Institute of Technology (MIT), which is renowned for being one of the top technical schools in the world. Micali is one bright cookie and realized that the blockchain trilemma could be resolved by employing randomness.
Algorand does this by selecting validators randomly from all token holders. The network relies on an algorithm that automatically picks the next group of nodes that become eligible to add blocks. This approach maintains decentralization since the system can select all participants. The fact that no one knows who the next validators will be ensures security, which is another essential element in the trilemma.
This mechanism has caused people to question who or what system is trusted to ensure random selection. This is the most important aspect of Algorand, as it solves the trilemma by employing a novel Pure Proof of Stake (PPoS) consensus algorithm. Micali explained how the system works:
“In Algorand, we do something a bit unorthodox – essentially, the token holders choose themselves at random. If you think about it, that seems to be a terrible idea […] because if I’m a bad person, I’m going to select myself over and over again because I want to be part of the committee every single time”
What Micali is getting at is that every token holder can run its own individual lottery, akin to pulling a slot machine lever resulting in either winning a ticket or not. If a ticket is won, that token holder is one of the 1,000 randomly selected holders that can add the next block in Algorand and ensure that transactions are verified. Micali goes on to elaborate:
“Even if I am an entire nation, extremely powerful with incredible computing power, I don’t have the ability to improve even minimally my profitability of one of my tokens winning the lottery”
This puts all token holders at an equal advantage, secures the network and reduces the chances of malicious actors while keeping the system scalable as the lottery happens in one microsecond.
The Algorand Network
The protocol used by Algorand is designed for speed. In theory, the developers have reached optimal efficiency by finalizing blocks in just one round of voting.
This ensures that each block is finalized instantly and dramatically increases the transactions per second handled by the network. As part of Algorand's protocol upgrade, the blockchain saw a 5x performance boost to 6,000 TPS and a roughly 10% decrease in round times to less than 4 seconds.
Algorand is a serious contender to support the future of finance. However, while the original 1,000 TPS figure was impressive for an initial launch, that still would not be enough to dethrone the likes of Visa, which can handle 24,000 transactions per second.
Algorand is working on a solution to this. Its developers plan to speed up the block finalization time to 2.5 seconds and increase the number of transactions in each block to 25,000, which works out to 10,000 TPS.
Though 10,000 TPS still isn’t enough to support a global financial system, the genius of the Algorand Foundation has come up with a new technology known as “pipelining.”
What pipelining essentially does is that the network will assume that a block is valid as soon as a participation node proposes it. As proposals on Algorand only take half a second, this will turn that 10,000 TPS into an eye-watering 50,000 TPS. Take that Visa!
Four thousand transactions are subtracted from the 50,000 TPS figure as about 1% of proposals fail to finalize. This would put Algorand ahead of Ripple (XRP) and light-years ahead of Bitcoin and Ethereum.
Now, for anyone who has alarm bells ringing and understands that increasing block size and reducing transaction times so dramatically will result in the blockchain growing at unsustainable levels leading to storage issues, you are correct. This proposed solution will result in fewer nodes being able to store the entire transaction history, which can result in decentralization issues.
This concern was anticipated by Silvio Micali and has been raised by the Algorand community. A look at the Algorand site shows that they have a solution to this as well. Algorand will deploy a trademarked blockchain compression technology called VAULT, which will minimize storage requirements.
I am going to be honest when I say that the technology behind VAULT is well above my head and outside the scope of this article. Reading about how it works is akin to trying to explain to an ant colony how to fix my broken toaster, which I also can’t seem to figure out. However, if you are inclined to learn more, you can look at the 15-page MIT document, which covers how it works.
The speed of Algorand is not the only goal, as security is also of the utmost importance. Therefore, the Algorand network has been architected to withstand elongated network partitions and recover quickly, securing it against multiple potential real-world attack scenarios. A network partition is an attack at the network level that makes it difficult or even impossible for users to interact on the network. Here is a diagram showing the results of a successful partitioning attack:
These attacks have happened on some networks already, with the intention behind the attacks often unknown as the attacker doesn’t achieve anything other than disrupting the network. Many theories point to these attacks being launched by competing blockchain networks which I hope isn’t the case as we are all on the same team and should be working together, not attacking competing networks.
Network attacks are always a possibility, regardless of the network. Anytime an attacker is powerful enough to maintain a network partition indefinitely, no blocks can be produced, effectively shutting down the network. One way to combat this is to increase the cost to the attacker until they cannot hold, which is one of the many reasons why some networks have network fees to ensure that this cannot happen.
Proof-of-Work blockchains have it worst in these scenarios. A PoW blockchain will form two separate chains, one in each partition. When the partition closes, the lesser chain disappears, taking all the transactions from that side away. What’s worse is that a network attack can be made on specific protocol messages, making it nearly impossible to detect a network partition. For example, here is how a partitioning attack could look on the Bitcoin network:
Algorand's Consensus Protocol has been designed in a way that makes these attacks unlikely due to the transaction costs that the attacker would incur, and the Algorand network has been designed in a way that there is near-instant partition recovery, so the network doesn't go down for any significant amount of time.
Algorand Consensus Protocol
In the case of Algorand's Pure-Proof-of-Stake architecture, Byzantine Agreement is used, but it is optimized for high performance and massive scale. This works as long as there is greater than a two-thirds honest majority, and participants do not need to be synchronized.
When the elected leader is honest, a consensus is reached in just two steps. When the elected leader is malicious, consensus can still be reached within a constant number of steps.
This keeps the protocol resilient even in the face of arbitrary network partitions of unknown length. The network also recovers rapidly once the partition is resolved. This near-instant recovery from partitions makes it expensive for an attacker to stall the network since the attacker would need to frequently pay the cost for disrupting the network.
If the first block proposal is from an honest leader, the first vote occurs immediately when network participants receive the block. This means that once the block propagates through all the participating nodes, it is approved after just one round of voting, which is one of the ways Algorand boasts high speeds.
We have already discussed Algorand’s Verifiable Randomness mechanism and how it pertains to scaling and resolving the blockchain trilemma. This solution allows participants to check privately and see if they have been selected to participate in the agreement for the next block and then include proof of selection in their network messages.
Algorand’s protocol doesn’t require users to keep any private state other than their private keys. This means the network can replace participants immediately after a network message is sent and avoids attacks that could be targeted on individuals once their identity is known.
Even in the unlikely event that an attacker can gain control of the network and manipulate which messages are delivered to which users, the Algorand agreement protocol will not fork, which will keep the user’s account balance secure.
This is how Algorand has been designed to work securely and efficiently in a permissionless environment with a random number of participants. All participants can join or leave the network at any time, and there is no need for an approval or vetting process.
There has been a lot of exaggerated and blatantly false news being spread, tarnishing Bitcoin's reputation as it has become the target of unfair and misinformed headlines about Proof-of-Work mining's environmental impacts. You can read more about why this was nothing more than FUD in my Bitcoin mining article.
All this worry has resulted in a significant movement towards greener and more eco-friendly cryptocurrencies, and Algorand has certainly benefitted here.
Whatever people want to believe about Bitcoin mining, not even the most die-hard eco-warriors could have anything negative to say about Algorand. As mentioned, Algorand has placed a strong emphasis on sustainability, and the network has blown past simply being carbon neutral, reaching carbon negativity last year.
Algorand pledges to be the greenest blockchain in the world, and they have met that pledge so far, so a large tip of the hat to them. A quote from Micali states:
"Algorand developed a public blockchain that runs on a version of proof-of-stake, which drives electricity consumption to almost zero…on a fundamental level, I care about the planet."
This was achieved by Micali's new orchestration of state-of-the-art distributed computation, cryptography, and game theory that led to the creation of the Pure Proof-of-Stake consensus protocol, which can run while remaining incredibly energy efficient.
Algorand's dedication to energy efficiency has attracted many eco-friendly-minded developers, encouraging further project growth in Algorand with a common goal of doing what is right for the planet.
Of course, the nuts and bolts behind what makes this type of consensus mechanism energy efficient are incredibly complex and outside the scope of this article. However, if you enjoy math and are up for a nerd-out session, you can read how this works in Algorand's blog on sustainable blockchains.
Algorand Upgrade: Increased Opportunities for Scaling
In September 2022, Algorand rolled out a significant upgrade featuring State Proofs, an interoperability standard that connects blockchains with the real world without intermediaries.
The Algorand 3.9 upgrade improvements include: -
- Enabling trustless cross-chain communication
- Increased TPS (transactions per second) from 1,200 to 6,000
- New tools for streamlining development
- On-chain randomness capabilities: Network validators are chosen randomly regardless of the amount of staked Algorand (ALGO)
- Increased block size to 5 MiB with a less than 4-second block finality and latency size (making blocks smaller)
"With today's release, Algorand proves once again that decentralization does not need to come at the cost of performance or security. Interoperability between blockchains is the future, and Algorand State Proofs are a critical security feature for communication between networks. We are extremely proud of this innovation and believe it will push the entire blockchain landscape forward." (Silvio Micali, founder of Algorand. Source: PR Newswire)
Algorand State Proofs provide a secure, trustless and simple interface that proof-of-stake (PoS) chains can use without compromising on security, cost, or reliability. The faster TPS means that organisations can build and scale applications on Algorand to meet the increasing demands of Web3.
"Algorand blockchain will be able to handle roughly 26,000 transactions per block at peak throughput, translating to 6,000 TPS." (Source: Algorand)
This significant upgrade adds additional kudos to the layer-1 blockchain with an already impressive history of zero downtime since it began. The stable, carbon-negative, secure, and high-speed network.
Algorand Team & Partners
Algorand was founded by Silvio Micali, an MIT professor who has put together a powerful team to further the development and adoption of the network. Unlike some projects that consist primarily of entrepreneurs at the head of the project, Algorand consists primarily of researchers and scientists. Because of the connection to MIT, most of the Algorand team is located in Boston.
Pop Quiz: What do inventing a highly efficient blockchain protocol and becoming a professor at the most well-respected technical school in the world have in common?
Answer: You need to be pretty darn sharp to accomplish either one.
Micali is a professor of computer science, and his work has led to him winning the Turing Award in 2012, which is one of the most distinguished achievements available in the technical community. This is basically the Nobel Peace Prize for nerds (types "nerds" bitterly as I still can't figure out how to fix that toaster! So much for my chances of ever winning a Turing Award).
Micali received the Turing Award for his fundamental contributions to the theory and practice of secure two-party computation, electronic cash, cryptocurrencies and blockchain protocols. If anyone is qualified to create a blockchain protocol capable of supporting the future of finance, it is Silvio.
Though one person can’t run the entire Algorand alone, Silvio is joined by his leadership team comprising Paul Riegel, the CPO and Mathew Commons, the CFO.
Algorand's Executive Team:
- Silvio Micali the founder of Algorand. He is an expert in cryptography, secure protocols, and pseudo-random generation. He oversees all of the research and security involved with Algorand. He is the co-inventor of a large number of protocols, including Verifiable Random Functions, Zero-Knowledge Proofs, and Probabilistic Encryption.
- Paul Riegle is the the CPO at Algorand. He has a background in driving product strategies for all levels of organisations, such as startups and Fortune 25. Paul previously led product management with Carbon Black "for all strategic initiatives across a portfolio of products that produce over $200 million in recurring revenue." He has held other leadership positions including founding a startup and IBM global product management. Paul has a Bachelor's Degree in Integrated Science and Technology from James Madison University and an MBA from the University of Notre Dame. (source: Algorand)
- Matthew Commons became the CFO of Algorand in March 2023. Prior to this role. He was President and Founder of Common Partners, which is an executive advisory company serving well-known FinTech and blockchain organisations. Before that, Matthew was the CEO, co-founder and chairman of Cambridge Blockchain Inc, which was later sold to Blockchains Inc in 2020. Matthew has worked with leading energy companies in financial and strategic roles. He is a Chartered Financial Analyst (CFA) charter holder, has a BA and BS from The University of Pennsylvania and The Wharton School and an MBA from Harvard Business School.
Other members of the Algorand leadership team include: -
- Jing Chen: Head of Theory Research and Chief Scientist
- Yossi Gilad: Head of Systems Research & Chief Technology Officer
- Gary Malouf: Head of Engineering
- Chris Peikert: Head of Cryptography
- Anne T. Warner: General Counsel
Michele Quintaglie joined Algorand in September 2022 as Chief Marketing and Communications Officer to lead the marketing, create new sponsorships, and develop brand building and initiatives.
Algorand's advisory team consists of a Senior Strategic Advisor and ex COO, W. Sean Ford, Steve Kokinos, ex-Algorand CEO who transitioned to Senior Advisor and Paul Milgrom as the Economic Advisor. Algorand's Scientific Advisors are Costantinos Daskalakis, Shafi Goldwasser, Maurice Herlihy and Vinod Vaikuntanathan. Alessandro Chiesa is the Cryptocurrency Advisor.
In addition to the core Algorand team, there is also the Algorand Foundation, which is the governance and research organization leading the development of the Algorand platform.
This article only highlights a small sample of the people currently working with Algorand. You can see a more thorough breakdown on their team page.
As mentioned, Algorand has received several investments from numerous Venture Capital funds. These range from crypto-specific funds to more general tech-focused investors.
Arrington Capital has been increasingly bullish on Algorand and offered a $100m growth fund in 2021 for projects looking to build on the network. Also, that year, Valkyrie announced that they would be launching the Valkyrie Algorand Trust (VALGO), a professionally managed investment fund. Skybridge capital also raised a $100m Algorand fund and filed for a crypto company ETF, so there is no shortage of external confidence from large firms piling money into research and development on the network.
Algorand is also bullish on itself and invested in its own VC fund called Algocapital. This fund has raised $100m and will support projects that aim to build on the Algorand protocol. Later in 2021, Algorand Foundation launched an additional $300 million fund called Viridis to support DeFi innovation.
The Algorand team updates their various social pages and blogs frequently, keeping their community up to date on news and announcements. In addition, the Algorand team are active on platforms such as Twitter, Facebook, and Telegram.
The team is also great at providing in-depth technical information to give users a deeper understanding of the project and its goals. This helps attract developer attention, and the Algorand Foundation supports those looking to build on Algo, with a developer portal easily found on the main site.
On Twitter, the team has over 330k followers, the Facebook page has about 130k followers, and the team's Telegram channel is quite active with over 18k active members, highlighting the strength of the Algorand community.
There is also a platform specifically for the Algorand community, including various developer resources, a forum, SDKs, information about upcoming events, etc.
The ALGO Token
Algorand held a Dutch Auction ICO in June 2019 and raised over $60 million, selling 25 million tokens at $2.40 each. The ICO date coincided with the launch of the Algorand mainnet, in which the total supply of 10 billion ALGO tokens was minted. Algorand's all-time high was barely above the ICO price during the 2021 bull run.
Algorand Inc. and the Algorand Foundation received the majority share of the ALGO token with the remainder being distributed as you can see below:
Unfortunately for those who participated in the ICO, the token has not held up well over the first year and nearly all ICO participants opted to get a refund on their ALGO in 2019 and 2020.
The concentration of holdings between the Algorand Foundation, Algorand Inc., along with the large initial supply influx, accelerated vesting schedule, structured selling, and sell pressure from early investors, has historically suppressed the price, resulting in a lacklustre performance for the Algo token.
The Algorand Foundation responded to investor frustration regarding the poor price action by releasing a tokenomics report to show the effects of the Algorand supply shock and circulating supply.
It appears as if much of the damage has been done in the first year. Hopefully, the token can start performing better as much of the supply pressure has been removed and demand for the token increases.
In my opinion, the Algorand Foundation seems to follow a similar mindset to Cardano. They are not as concerned with investors' moonbags and hyping their networks as we see with networks such as Solana, which is heavily promoted by VC-funded advertising. Hoskinson, the founder of Cardano, has even spoken openly in interviews that he is not overly concerned with the price of his network's token, and it isn't his position to speculate on price or try and understand market behaviour. I guess he's got a point.
Projects like Algorand and Cardano seem to place a stronger emphasis on tech, building and creating the future, and forming strategic partnerships as opposed to hype and seem to follow the mantra "If you build it, they will come." They seem confident that superior technology and use cases will lead to adoption and network participation. Though there is no denying the power of hype, just look at Doge — a little hype can go a long way.
Another positive for Algorand’s potential price appreciation could come from the millions of dollars that the Algorand Foundation has received in VC funding. With all that institutional money flowing in, this may lessen the Algorand Foundation’s need to sell to finance projects.
Buying & Storing ALGO
Algorand can be picked up on Binance, Coinbase, Huobi (now called HTX) KuCoin, OKX and Kraken, covering major exchanges. Smaller exchanges also list the tokens such as Hotbit, MXC, CoinEx, Bilaxy, and Bit-Z. Algorand can also be purchased and staked for a nice APY on OkCoin; feel free to look at our OkCoin review to learn more.
Across these exchanges, a healthy trading volume is well spread out and reduces the reliance on any one exchange.
Once you have your ALGO tokens, the security-minded will likely want to take them off the exchange and store them in a wallet, as we are all too aware of the risks that come from storing large quantities of coins on centralised exchanges.
Algorand has multiple mobile wallets for both Android and iOS devices. As Algorand has increased in popularity, most major mobile and desktop wallets such as Exodus and Coinomi also support ALGO tokens. Looking for hardware wallets? Trezor, Ledger Nano X and Ledger Nano S support it too.
Algorand wallets can be connected to Wallet Connect for ease of interacting with DeFi.
If you're interested in staking Algorand, you can participate in their Governance program. This program allows you to earn rewards by holding ALGO tokens and participating in the network's decision-making. As of April 2022, the Algorand Foundation has phased out its staking rewards scheme, transitioning to governance rewards instead.
To join the Governance program, you need to register during each quarterly governance period's enrollment window. Rewards are usually disbursed within the first week after each period concludes. To estimate your potential earnings, you might find an Algorand staking calculator useful.
According to stakingrewards.com, roughly 27% of Algorand is staked, way down from the 81% that was staked when we wrote this original review two years ago.
This is because Algo used to be among the easiest coins to stake, simply holding in any non-custodial wallet would pay out staking rewards automatically. The current staking system involving governance is a little more “involved” with the majority of people staking having active interest and participation in the Algorand project.
You can learn more about how governance rewards work on the Algorand Foundation’s blog.
Use Cases and Projects
One of the primary reasons Algorand shows long-term potential aside from the advanced tech is the expanding number of projects and use cases already deployed or in development. For example, Algorand has helped people in developing nations establish self-sovereign digital identities for individuals and has created tokenized traceable commodities such as gold for investors. Algorand has also become one of the primary networks of choice for many institutions and government agencies worldwide.
Here is a look at the growing Algorand ecosystem:
Algorand was chosen by the Marshall Islands to power its digital currency, the SOV (short for “sovereign”). This nation chose Algorand to launch its digital currency due to its speed, scalability, security and the network’s ability to implement compliance controls needed for a national currency.
The island’s currency will be algorithmically programmed to grow by 4% per year, which will reduce the possibility of having runaway inflation that many national governments are currently struggling to combat, and why many investors are turning to Bitcoin as an inflation hedge.
In June 2023, DWF Labs announced a partnership with Algorand Foundation to support the health and growth of the ecosystem built on the Algorand blockchain. To that effect, DWF Labs inked a $50 million ALGO token purchase agreement to, in part, provide liquidity into the Algorand ecosystem. An additional memorandum of understanding was signed with the aim of allocating funds to support projects that are building on the Algorand blockchain in the spaces of DeFi, art and music, gaming, oracles and bridges, and infrastructure.
In 2021, Algorand secured a significant partnership with e-Money, enabling them to issue European currencies and stablecoins on Algorand in what could be the start of European CBDCs.
Algorand was also chosen by the massively popular Exodus cryptocurrency wallet company for the tokenized sale of shares during their public Regulation-A offering in 2021. This was a ground-breaking moment not just for Exodus and Algorand but also for the entire financial industry. This was the first registered and regulated tokenized Regulation-A Public Offering of its kind.
Another exciting announcement was from the Drone Racing League, announcing that they will be transforming sports and gaming through blockchain-based technology through their partnership with Algorand.
The Drone Racing League (DRL) is a first-person-view racing league where drone pilots race their drones through courses to compete for prize money. DRL has seen substantial growth in popularity among racers and viewers, with the company now valued at over $200 million.
The Drone Racing League (DRL) landed a $100 million deal with Algorand. While the terms have not yet been made public, we know that the DRL is planning to launch a Play-to-Earn drone racing game to the metaverse using Algorand.
Payscript is another interesting project building on Algorand. Payscript aims to transform and simplify the online crypto-payments process. Cryptocurrency payments are becoming more popular, becoming a part of the daily lives of many of us with things like the Bitcoin Lightning network now making it suitable to use Bitcoin to make daily purchases and Shopify supporting over 300 crypto assets.
Payscript provides users with a user-friendly, secure and adaptable crypto-wallet experience so that crypto payments become as convenient as traditional online payments.
Payscript is Striving to become the world’s most useful blockchain wallet, with a single point of reference for merchants and customers to complete transactions via invoices or smart devices.
FXDX is another fantastic project that has been launched on Algorand. FXDX is a decentralised exchange that revolutionises the traditional investment exchange industry by creating a trustless, permissionless, and non-custodial trading platform similar to Uniswap but allows users to trade derivatives such as perpetuals and utilise leverage.
What makes this concept so revolutionary is that traditionally, traders would need to worry about things like price manipulation and wash trading, but the lightning speed of Algorand and the use of blockchain technology makes these corruptive and manipulative practices a thing of the past.
IDEX is another excellent DEX worth checking out on Algorand. It is a hybrid liquidity DEX, Order Book and AMM where users can stake, and the platform even has a launchpad for new projects.
Authentium is another project that I like. It reminds me of why I got into blockchain technology in the first place. Authentium is one of those projects looking to make the world a better place by creating the world’s first decentralized primary producer commodity exchange (DEX) and DASCO (DAO) network.
Authentium is a pioneer in the industry using an open-source community sharing a vision to design and build an ecosystem of DAO like Decentralized Autonomous Supply Chain Organizations (DASCOs) that look to remove centralized authorities from global food supply chains.
Authentium aims to liberate producers, farmers, growers and distributors from centralized exploitive supply chains to create a world of peer-to-peer food supply chains that will allow those who work hard every day to feed the planet to keep more of their hard-earned profits.
Those are just a few of the great projects launching on Algorand. Most of the DeFi platforms that users love on Ethereum have an Algorand equivalent, which means that it has an increasingly popular NFT ecosystem.
Platforms like Zestbloom, Artsquare, and Aorist are just a few of the NFT marketplaces available on the Algorand network. Many artists and NFT enthusiasts are opting for Algorand because Algo NFTs can be minted for a fraction of the cost of their Ethereum counterparts. Nfts can be bought, sold, and transferred at light speeds while enjoying support on a secure, scalable and decentralized network.
Other notable mentions worth checking out are the Tinyman DEX, Orion Protocol, a liquidity aggregator combining CEXs, DEXs, and Swapping pools, and Opulous, a peer-to-peer platform that brings DeFi and NFTs to the music industry, to name but a few.
Algorand (ALGO) started 2023 at just over $0.17 and reached a high of $0.29 in February. Since then, the price has been on a gradual descent. As of Sept. 15, 2023, it is $0.09.
We're all aware that the entire crypto market has been underperforming for a while, but CEO, Staci Warden says that Algorand is unconcerned about price. During an Interview with Real Vision Crypto, Warden said that Algorand's focus is on attracting developers to the network to ensure prolonged success for Algorand's ecosystem.
“We are having a Cambrian explosion of builders on this ecosystem right now. I will say we try to make sure that they have a good path to success.” (Staci Warden, Algorand CEO: Source: Cryptoslate)
Algorand takes a "bottom-up" approach to future development, trusting that building a strong foundation is the way to ensure longevity in a market dominated by volatility and ever-changing sentiment.
Algorand Review: Conclusion
Algorand was created by a highly respected cryptography professional from MIT. The project is supported by a world-class team of research scientists, business and marketing professionals, and some impressive VC firms funding behind their ambitions. This has all brought about high expectations for the project. So far, the team has delivered incredible results regarding network growth, adoption, and support for new projects.
While the network growth is impressive, the ALGO token performance remains a pain point for the community. Time will tell how well the token holds up as the network evolves and demand drivers increase.
The mainnet launch went off without a hitch which was a good sign and signalled confidence to some strong firms and partners who were quickly interested in cementing relationships with the Algorand Foundation.
Algorand has significantly contributed to the blockchain landscape through its technological developments, research, and published papers. Their work on blockchain compression techniques and further improvements through its recovery mechanism for network partition attacks has been incredible for the crypto industry.
These developments have shown that there are viable compression techniques that can lead to sustainable scalability and that it is possible to create a network that is economically unfeasible for an attacker to disrupt the network for any appreciable amount of time.
Algorand has been impressive in its development speed and the lack of significant bugs. The mainnet launched very quickly, and the code base, which has been publicly released, has been deemed to be well-documented and solid by the developer community.
At this point, Algorand appears to be both technically and commercially positioned to be a success in the blockchain space. Of course, it remains quite early in the development of this industry, but this is one project that deserves attention going forward.
Frequently Asked Questions
Algorand is a decentralized permissionless blockchain protocol that can be built upon and accessed by anyone. The Algorand protocol is designed to overcome three of the most prominent issues most blockchains face: security, scalability, and decentralization
Algorand was created in 2017 by Silvio Micali, an MIT professor who won the Turing Award for his work in cryptography.
Algorand employs Pure Proof of Stake (PPoS), which is a consensus algorithm that makes use of a Byzantine agreement protocol. In the event that a node is compromised, staked ALGO tokens owned by participants in the network will be automatically protected using unique keys
While the term “better" is subjective, Algorand is undoubtedly one of the most advanced blockchains from a technical perspective.
Theoretically, decentralization, scalability, and security are all achieved by Algorand, making it the first network to overcome the blockchain trilemma. I say “theoretically” as Algorand has not yet been as battle-tested in terms of network congestion as Ethereum or Bitcoin, only time will tell how the network will hold up under extreme conditions.
Algorand is also the first and only institutional-grade blockchain infrastructure that is also ecologically friendly and can achieve all three without compromise.
ALGO is the native coin of the Algorand network. It is used for governance, securing the network, and covering fees on the network.
Yes, right from the conception of Algorand, the Algorand Foundation has placed a strong emphasis on the environment. Algorand went beyond carbon neutrality and actually became carbon negative in 2023, making a positive impact on the environment.
Byzantine Agreement is a communication protocol that enables users of a distributed system to come to a decision even while harmful actors are present.
Algorand's Byzantine Agreement makes a novel use of Verifiable Random Functions (VRFs), which makes it exceptionally effective.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.