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Abstract

creating a balance between the following three elements:<ol><li>Decentralization: the network should not rely on a single point of control</li><li>Scalability: the blockchain should scale to accommodate a large number of users</li><li>Security: the system should be resilient to bugs, malicious attacks, and other problems</li></ol>Algorand solves these problems using a protocol it calls pure proof-of-stake (PPoS). Full details can be found on the <a href="https://www.algorand.com/technology/protocol-overview">Algorand website</a>.Due to the lightweight nature of the protocol Algorand transactions are extremely fast and cheap. Here are some key statistics about Algorand transactions:<ul><li>Algorand transactions typically take less than 5 seconds to complete</li><li>Transactions can be very small (as little as 0.0001 ALGO)</li><li>Transaction fees are tiny at <a href="https://www.algorand.com/resources/blog/stablecoin-use-accelerates-on-algorand-with-exchange-support">0.001 ALGO</a> (currently $0.0014)</li></ul>These qualities make Algorand a prime candidate for creating a national or Central Bank Digital Currency. In fact, one country, the Marshall Islands is already using the Algorand network for its <a href="https://www.algorand.com/ecosystem/use-cases/marshall-islands-sov">national digital currency</a>, the SOV. I wouldn’t be surprised if others follow suit.<h2 id="feff">NFT</h2>NFT’s (Non-fungible tokens) are a huge deal these days, with companies adopting them for many purposes. Algorand is a leading platform for NFTs, with Italy’s largest copyright agency (<a href="https://www.siae.it/en">SIAE</a>) rolling out NFTs representing authors’ rights on the Algorand blockchain.In addition to being a leading platform for NFTs, Algorand also supports <a href="https://www.algorand.com/resources/blog/algorand-nft-market-fractional-nfts">fractional NFTs</a> enabling multiple people to co-own tokenized assets.<h2 id="f13b">DApps</h2>Finally, Algorand has first-class DApp support. Decentralized apps are a hot topic, and Algorand provides a web API along with <a href="https://developer.algorand.org/docs/reference/sdks/">SDKs</a> for JavaScript, Python, Java, and Go. All extremely well documented with a thriving community.

Options

Existing DApps on Algorand go from crowdfunding apps to voting, to a <a href="https://developer.algorand.org/solutions/using-algorand-blockchain-track-covid-19/">Covid tracker</a>. The range is constantly expanding.<h1 id="0e85">Algorand Tokenomics</h1>As previously mentioned, it is possible for developers to create their own crypto tokens on the Algorand blockchain, however, the native token is ALGO.ALGO is a utility token that can be used for paying staking rewards, as well as transaction fees and DApp computations.Here are some statistics about ALGO:<ul><li>Maximum supply: 10 billion</li><li>Current circulating supply: <a href="https://algoexplorer.io/">5.5 billion</a></li><li>Date for all tokens to be released: 2030</li><li>Staking reward roughly 6% APY</li><li>No minimum stake, no staking lock-in</li></ul>The fact that not all tokens have yet been released into circulation means that ALGO is inflationary. There is <a href="https://www.reddit.com/r/AlgorandOfficial/comments/luirzi/the_truth_about_algo_inflation/">quite a bit of debate</a> about the effect that this has on price, but suffice to say that for the price to increase demand needs to exceed supply.In traditional bonded proof-of-stake blockchains, supply is restricted by staking lock-in, but this is not the case with Algorand. Anyone can stake any amount of Algo for any period of time.<h1 id="e793">Is it Worth Your Money?</h1>So, the ultimate question… is Algorand worth investing in…? Personally, I view Algorand as a long-term play. You could think of it as the absolute opposite of a pump n dump altcoin like Doge. If Doge were Captain Jack Sparrow, Algorand would be Clark Kent!Long-term, steady, growth is factored into Algorand’s tokenomics, but this relies heavily on growing utility demand for DApps and transactions. For me, the strength of the team and the potential value of the ecosystem is convincing.Thank you for reading. If you have any thoughts on Algorand, I’d love to read them in the comments.DISCLAIMER: This article presents my own learnings based on personal experience. It should not be considered Financial or Legal Advice. Consult a financial professional before making any major financial decisions.</article></body>

Algorand… The Best Crypto Nobody’s Talking About

Algorand has it all, could it be worth your money?

TLDR

For the impatient, here’s my elevator pitch for Algorand:

Insanely fast blockchain network with super low-cost transactions
Proof-of-stake with 6% APY reward and no minimum stake
Carbon neutral with a pledge to go carbon negative
Huge growth potential: top 50 crypto with $4 billion market cap
A large established ecosystem of DApps and 3rd party projects

If that’s whetted your appetite, read on…

The Algorand Team

The man in the picture above is Silvio Micali. He has a Ph.D. in Computer Science from Berkeley and has been a professor at MIT’s Electrical Engineering and Computer Science department since 1983.

He has received the Turing Award for computer science, the Gödel Prize for computer science, and the RSA price for cryptography. He co-invented probabilistic encryption. Frankly, his credentials make Charles Hoskinson look like a grad school hack.

He is also the founder of the Algorand blockchain…

Alongside him is CEO, Steve Kokinos. Steve previously co-founded the cloud collaboration platform Fuze, and was a founder of network automation solution BladeLogic.

The Algorand team is high caliber, to say the least. Surrounding them is a large, growing community of developers. Projects being built on the Algorand platform are increasing by the day.

The Algorand Network

Algorand seeks to solve the Blockchain trilemma. This entails creating a balance between the following three elements:

Decentralization: the network should not rely on a single point of control
Scalability: the blockchain should scale to accommodate a large number of users
Security: the system should be resilient to bugs, malicious attacks, and other problems

Algorand solves these problems using a protocol it calls pure proof-of-stake (PPoS). Full details can be found on the Algorand website.

Due to the lightweight nature of the protocol Algorand transactions are extremely fast and cheap. Here are some key statistics about Algorand transactions:

Algorand transactions typically take less than 5 seconds to complete
Transactions can be very small (as little as 0.0001 ALGO)
Transaction fees are tiny at 0.001 ALGO (currently $0.0014)

These qualities make Algorand a prime candidate for creating a national or Central Bank Digital Currency. In fact, one country, the Marshall Islands is already using the Algorand network for its national digital currency, the SOV. I wouldn’t be surprised if others follow suit.

NFT

NFT’s (Non-fungible tokens) are a huge deal these days, with companies adopting them for many purposes. Algorand is a leading platform for NFTs, with Italy’s largest copyright agency (SIAE) rolling out NFTs representing authors’ rights on the Algorand blockchain.

In addition to being a leading platform for NFTs, Algorand also supports fractional NFTs enabling multiple people to co-own tokenized assets.

DApps

Finally, Algorand has first-class DApp support. Decentralized apps are a hot topic, and Algorand provides a web API along with SDKs for JavaScript, Python, Java, and Go. All extremely well documented with a thriving community.

Existing DApps on Algorand go from crowdfunding apps to voting, to a Covid tracker. The range is constantly expanding.

Algorand Tokenomics

As previously mentioned, it is possible for developers to create their own crypto tokens on the Algorand blockchain, however, the native token is ALGO.

ALGO is a utility token that can be used for paying staking rewards, as well as transaction fees and DApp computations.

Here are some statistics about ALGO:

Maximum supply: 10 billion
Current circulating supply: 5.5 billion
Date for all tokens to be released: 2030
Staking reward roughly 6% APY
No minimum stake, no staking lock-in

The fact that not all tokens have yet been released into circulation means that ALGO is inflationary. There is quite a bit of debate about the effect that this has on price, but suffice to say that for the price to increase demand needs to exceed supply.

In traditional bonded proof-of-stake blockchains, supply is restricted by staking lock-in, but this is not the case with Algorand. Anyone can stake any amount of Algo for any period of time.

Is it Worth Your Money?

So, the ultimate question… is Algorand worth investing in…? Personally, I view Algorand as a long-term play. You could think of it as the absolute opposite of a pump n dump altcoin like Doge. If Doge were Captain Jack Sparrow, Algorand would be Clark Kent!

Long-term, steady, growth is factored into Algorand’s tokenomics, but this relies heavily on growing utility demand for DApps and transactions. For me, the strength of the team and the potential value of the ecosystem is convincing.

Thank you for reading. If you have any thoughts on Algorand, I’d love to read them in the comments.

DISCLAIMER: This article presents my own learnings based on personal experience. It should not be considered Financial or Legal Advice. Consult a financial professional before making any major financial decisions.