Knowledge Center

Everything You Need To Know About Algorand

Algorand (ALGO) is an open-source blockchain designed by its creators as a solution to three major blockchain issues. It attempts to address the problems with scalability, security, and decentralization. They use a system of smart contracts and proof-of-stake protocols to achieve on-chain goals. Algorand comprises a company and a foundation that independently takes on each of these tasks.

The Algorand foundation places most of its focus on scalability in cryptocurrency ecosystem growth. They are also deeply involved with implications for on-chain governance. Their most significant initiative is supporting the decentralization of the Algorand network and its nodes.

What is Algorand?

The founders of Algorand created this open-source blockchain solution to answer common blockchain issues. ALGO is the native coin of this technology that comprises both a company and an independently operating foundation.

Also Read: What is Defi Crypto or decentralized finance? – Crypto Bite

Who Created Algorand?

Silvio Micali founded Algorand in 2017.

When Was Algorand Launched?

Creators launched a beta network for this technology in April 2019. The official launch to the general public happened shortly after in June 2019.

How Does Algorand Work?

Algorand uses a consensus algorithm and decentralized Byzantine agreement protocol to leverage proof-of-stake. They designed this technology to be secure enough to withstand malicious users in the ecosystem without interrupting its function.

It operates using a three-part proof of stake system that entails proposing, confirming, and writing transactions on the blockchain. The formal terminology for these processes on Algorand is as follows.

  1. Propose – during this process, they select random users using cryptographic sortition to propose new Algorand blocks. Users are required to submit cryptographic proof that they are official members of the ALGO VRF committee. Users with larger ALGO stakes are more likely to be selected than users with lower stakes.
  2. Soft Vote – during this secondary process, they use the Byzantine Agreement (BA*) protocol to vote on the newly proposed blocks created in stage one of the process. They used cryptographic sortition in the second stage to verify users needed to vote on the newly proposed ALGO blocks. Users in this stage also re-verify the committee membership of members from the first phase.
  3. Certify Vote – When they achieve a consensus, they issue the new ALGO block on the network.

How to Keep Your Algorand Safe

ALGO stakeholders use third-party hardware wallets and offline cold-storage wallets to keep their Algorand safe. Using offline cold-storage wallets decreases the likelihood of theft or online cyber-attacks. These secure storage wallets give users private offline keys for their ALGO stakes that only authorized users can access.

Is Algorand a Good Investment?

We do not provide investment advice. The information in this post provides historical performance with advantages and disadvantages of today’s top blockchain and cryptocurrency technologies. Blockchain experts say, Algorand (ALGO) has shown steady performance and tout it as being one of the best blockchain options based on this performance.

This technology has a low token price combined with an extremely high number of circulating coins. Algorand supply tops out at over 6 billion coins. The owners of this technology operate several real-world projects, including potentially serving as a digital currency for small nations.

Before investing in the ALGO blockchain or any other cryptocurrency, it’s important to do your research. Make sure you understand the risks and benefits associated with choosing your investments. Consider how much you can afford to invest and also how much you can afford to lose should your investment go south.

Related posts
Knowledge Center

Everything You Need To Know About Cosmos

Knowledge Center

What Is Hyperinflation?

Knowledge Center

What is a Forward Contract?

Knowledge Center

What Is A Perpetual Futures Contract? 

Sign up for our Newsletter and
stay informed

Leave a Reply

Your email address will not be published.