Algorand is a self-sustaining decentralized, blockchain-based network that supports many applications.
What is Algorand?
- Algorand was initially launched in 2019 and could handle 1 million transactions daily by December of 2020.
- Algorand uses Pure-Proof-of-Stake (PPoS) as a consensus algorithm, where it distributes the ALGO cryptocurrency into the economy with each new block to everyone that holds a specific amount of ALGO tokens on their cryptocurrency wallets.
- ALGO is the native utility token used to power the entirety of the Algorand ecosystem. It is also used as a way through which users can pay for the transactions and the smart contract computations.
- Algorand can also be used on decentralized finance (DeFi) applications outside of the Algorand ecosystems through the synthetic versions of the token. This means that you can find Wrapped ALGO, which is an ERC-20 token and works on the Ethereum blockchain, for example.
|Token Type/Protocol||Algorand Standard Assets (ASA)|
|Total Token Supply||6,614,685,833|
|Current Circulating Supply||See Coinmarketcap|
|Market Capitalisation||See Coinmarketcap|
|Token Creation Date||April 2019|
|Can it be mined?||No|
Who is behind Algorand?
Algorand (ALGO) was created by Silvio Micali, a computer scientist, and a Massachusetts Institute of Technology (MIT) professor.
He authored the Algorand white paper alongside Jing Chen in 2017, who is a Stony Brook University Professor. That said, this work is funded by the Algorand Foundation, a Singapore-based corporation founded with the goal of advancing technology.
What is the purpose of Algorand?
The Algorand blockchain is specifically created with the goal of allowing developers to create new kinds of applications (dApps) that are only possible with the use of cryptocurrencies.
The platform is also used in many real-world industries, such as copyrighting, microfinance, and others. That said, the code is fully open-sourced, and anyone can easily clone it or copy it.
The main thing that truly makes Algorand unique is how it selects users to participate within the consensus protocol. This is done by randomly and secretly selecting block producers from the available pool of nodes through the usage of a weighted lottery system, where a node can be selected based on the amount of ALGO tokens they actually hold. The participants essentially change with each round and do not know if they have participated until it is completed.
- Algorand is a protocol that is split across two layers.
- The first layer, Layer 1, is used as a means to run the smart contracts, handle the atomic swaps, and rapid peer-to-peer exchanges of cryptocurrency tokens. The creation of new Algorand-based blockchain assets occurs within this layer.
- Then there is Layer 2, which is capable of running a larger, feature-filled smart contract network.
- When we look at the Pure-Proof-of-Stake (PPoS), it is a consensus algorithm that takes advantage of what is known as a two-phase block production process that consists of proposing and voting.
- This essentially means that any member of the Algorand network can participate in the proposing and voting procedure.
- This is done by staking ALGO and generating a valid participation key to become a Participation Node. These nodes can coordinate through a Relay Node, which actually facilitates communication.
- Algorand, although it has two layers, is effectively competing in the Layer-1 space against the likes of blue chips like Solana, Cardano, and Ethereum. As such, there is a lot of competition currently on the market, of which it will have to secure a niche in order to stay prevalent.
News and Updates:
- On October 19, Sequoia Games brought augmented reality to board games through the usage of the Algorand blockchain. This is a game developed to combine a physical board with NFT-backed characters, which can be bought or sold between players on the Algorand blockchain.
- On October 20, Applied Blockchain received a grant from Algorand Foundation for SILENTDATA Integration. This enabled users to present privacy-preserving proof of their traditional financial activity.
- GoSayHello received a $300,000 Algorand Foundation Grant to incentivize engagement by using blockchain assets on October 20.
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