Earlier this week we have covered TEZOS

For this edition I am going to cover ALGO, as this was the most upvoted suggestion.

Good news is that I managed to get some spare time and therefore the third Edition of DYOR came earlier, I hope this will be a nice surprise for the ones that started to follow and support these editions, and I want to use this opportunity and thank everybody for the support! I will try to make each new post a better experience for everyone!

Now lets deep dive into ALGORAND aka ALGO:

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ALGO – THE BASICS

Once again, we start with the basic and with a simple question. What is Algorand?

Algorand went to mainnet in June 2019, and it’s a decentralized blockchain based network that can support a wide range of different applications. Algorand is using smart contracts and their main goal since the beginning was to make payments fast and efficient with low fees and with a minimal impact on the environment in terms of energy usage. You can already sense that the main point behind Algorand is to tackle the challenge of Bitcoins high energy consumption and the ridiculous fees from Ethereum.

Algo is shifting its focus to provide scalability but also to tackle the famous “Blockchain trilemma” - security, scalability, and decentralization

Sounds pretty ambitious isn’t?

The first thing that you will notice, once entering their website is the following headline:

“Welcome to the Future of Finance” or simply FutureFi

There is a text just below trying to express their entire purpose of converging decentralized and traditional financial models. They are also emphasizing on the idea of a green future, meaning that they are targeting the audience that are concerned about the energy consumption in the cryptocurrency industry. This is visible on their website where you can discover the “Carbon Negative since 2021” logo which is something that I didn’t notice with other bigger projects.

What I like about the website is that they are offering a lot of information about the technology and use cases, and it’s a great place to discover more about the Algorand in general.

SILVIO MICALI – THE FOUNDER

I have to admit, you will almost never see any news, or posts and comments on reddit mentioning about Algo without mentioning Silvio Micali!

Usually, you will just hear about what a genius Silvio is, but rarely you can find comments giving other newcomers some insights why Silvio is so important.

Therefore, lets start with a mini biography about Silvio, and why he is the biggest star of Algo and its biggest and most important trademark.

Silvio Micali was born in Palermo, Italy, in 1954 and from a very young age he was interested in mathematics resulting in a mathematics degree from Sapienza University in 1978. He has received his PhD in 1982 at the University of California, Berkeley and short after joined the faculty at MIT in 1983.

Silvio was one of the key contributors in the field of Cryptography and his way of teaching and thinking is considered as non-conventional. Why? Well, he is using a totally different approach, as you will often see cartoons on his lectures as he is trying to make his teachings enjoyable and entertaining. If you want to check one of them, I would highly recommend one of his LECTURES

Ultimately his way of teaching has changed our understanding of some important notions such as randomness, secrets, proof, knowledge, collusion and privacy.

Micali contributed a lot to the scientific community with his work on public-key cryptosystems, digital signatures, secure multiparty computation and is one of the inventors of zero-knowledge proofs .

The biggest recognition for his work came with the collaboration with Shafi Goldwasser and the paper “Probabilistic Encryption”.

The interesting bit is that this paper was written while he and Goldwasser were graduate students and it’s considered as the most influential paper in the history of computer science. With this paper they helped to make cryptography a precise science. His collaboration with Shafi resulted in a Turing award in 2012.

There is a lot of things to explore, as Silvio is one of the most important figures in this field, and I highly recommend exploring and reading more of his work, I am sure that I will dive deep into these in the upcoming days.

In 2017, Silvio founded Algorand when he realized the opportunity to fulfill the promise of blockchain in our global society. His ambition is to solve the blockchain trilemma of achieving speed, security, and decentralization simultaneously.

It is important to mention that Algorand is not just Silvio, there are some very clever and capable team members working on this project such as:

Steve Kokinos – He is currently the CEO of Algorand Inc. and was the co-founder of Fuze.

W. Sean Ford – He is the COO and prior to that worked as the Chief Marketing Officer in LogMeIn

ECOSYSTEM

As mentioned in the basics, Algorand is a decentralized platform and its using Smart Contracts…but one of the key highlights that Silvio is taking on is the famous “blockchain trilemma”, how does Algo solve that?

The best way to explain it is to quote Silvio on this:

The traditional application of cryptography to blockchain is to prevent an adversary from altering the content of a block or the order of blocks. But in Algorand we use it for doing what we call a cryptographic sortition: we select an unpredictable committee (to add blocks to the network) whose members are not known until they show up with a proof that they belong to the committee. That is really the secret sauce of Algorand, which allows us to be very scalable and very distributed. In some sense, this is a use of cryptography because even though I am running my own lottery (forming the committee members), I cannot cheat. I cannot alter the probability of winning. And if I win, I can prove to you that I’m a legitimate winner of my own lottery.

It is really a new application for cryptography that allows us to unpredictably convene a committee. You cannot somehow control the committee members or know in advance who they are going to be. As you may know, many blockchains propose the blocks by way of a round-robin: participants take turns, and an adversary knows in advance who is going to generate the next block and could perhaps attack. But if the generation of a new block is entrusted to a few committee members, say a few hundred or a thousand, and nobody knows who they are because they are the winners of secret individual lotteries, an adversary cannot go after them in advance. Once these people show up and say, “I won the lottery,” you can believe they are the real winners because nobody can alter the probability of winning or pretend to have won when they have actually lost.

So Algo is solving this dilemma with randomness, basically focusing on validators who are adding new blocks by picking them in a random order. This is called PPoS or Pure Proof of Stake and we have to add that one of the key features of Algo is that its forkless.

ROADMAP

This week Algorand announced a brand new upgrade called Algorand Virtual Machine (AVM). This upgrade allows the development of complex smart contract applications in the DeFi, NFT marketplace, web3 etc. This is enabling a new level of scalability and operates at over 1,000 Transactions per second and are final in under 5 seconds on a platform to blockchain. Now this is very important as Algo has some serious competition under this category with a lot of other projects offering fast and cheap transactions on their platform.

The one thing that a lot of Algo enthusiasts are looking at until end of this year is GOVERNANCE.

Governance will allow all participants of the network to influence monetary, technical and be a part of the decision making process around the Algorand ecosystem. This will enable everyone to shape the future of Algo going forward, it is in a way a similar concept as with Tezos that we have covered in our last edition.

The additional benefits are:

- Participation awards – a designed fund just for rewards

- Research and Innovation funds

- Algo Grant Program

- Research and Social Good Program

- Contingent Incentives

Officially this started Today!

These are indeed exciting news for all Algo enthusiasts. If you want more info about it, I found a great post about it so you can EXPLORE it.

TOKENOMICS

Well if start off with the tokenomics, Algo is not your “get rich fast” kind of token and its more considered as a long term investment. Why?

Algo has an algorithm in place called “Accelerated Vesting” and it basically means that if Algo reached an new ATH in a 30-day Moving Average, new Algo is introduced faster into circulation, and circulation is something that caused some debates.

Algo has a maximum supply of 10 billion coins and its currently sitting with a circulating supply of around 6.018 billion. The plan is to reach the max. supply by 2030, although this has been accelerated and there is a big chance that this will happen before 2030.

This was one of the main concerns from investors and there is a plan to end with Accelerated Vesting by mid 2023.

Algo is strongly focusing on participation awards and they are launching this starting October 2021.

Now if you are keen to get rich fast with Algo then I would suggest looking somewhere else, but on the other hand this is in my opinion a great long term investment with some great upcoming upgrades and projects where you can collect various awards in the form of Algo tokens.

USE CASES and PARTNERSHIPS

There is a lot of things going on in terms of Partnerships, even though many complain that there is a need for more adoption. I think that the development and engagement from the Algo team is heading in a good direction, and there are some really great use cases already present. I will name just some of them, but you can also explore more of them on their website:

- VitalPass - the first blockchain-based system to track COVID-19 vaccination, launches in Colombia with plans to expand to several countries in Latin America

- El Salvador – As they have signed a Cooperation Agreement with Koibanx to Develop the Government’s Blockchain Infrastructure on Algorand

- Circle - Algorand will be the first blockchain with a stablecoin implementation based on that framework that is Powered by USDC

- Marshall Islands SOV - Algorand was selected to power the first national digital currency for SOV because it has the best functionality required to issue, manage, and distribute the SOV on a global level

- MAPay – Providing healthcare payments for Bermuda

- SIAE – announced that they will launch their NFT on Algo as they are one of the largest and oldest digital rights management companies in the world.

It will be interesting to see how many more they will onboard in the next months, but one thing is sure the competition is fierce.

CONCLUSION

Algorand is here to stay, and this is a project that maybe still doesn’t have the immediate potential to become a TOP 10 Marketcap candidate, but I am sure that they are staying right at the top of the list as there is a strong focus on the technology and development as its choosing a more scientific and studious approach for the future. Don’t get me wrong, I think that this is a wonderful project, that has a brilliant founder, a great platform, and a lot of potential for growth. They are the first ones to solve the blockchain trilemma and they are not joking around! The upcoming governance will definitely attract a new patch of newcomers to the platform as Algo is offering pretty high staking awards with their wallet, especially if the Algo team increases the marketing efforts and additionally simplifies the entire customer onboarding and customer journey.

They are a bit behind with more significant partnerships and use cases compared to some key competitors, and there is still some discussions regarding the tokenomics but I can see that this project will succeed in the long term outlook and shift their focus on a sustainable and bright future in the cryptospace.

Its important to say that they are also tackling the problem of energy consumption and the Carbon Negative statement and image will help them to attract more and more new enthusiasts into this project.

We will hear a lot about Algo in the future, and Silvio Micali is one of the most important figures that ever-entered cryptocurrency. I am excited to hear more about them as we go forward as this is one of the more interesting projects out there.

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That’s it!

I hope you have enjoyed the Edition 3!

Feel free to comment and give your opinion about Algo and also suggest some improvements for future Editions.

And now…lets move to Edition 4.

Once again, the top rated comment suggesting a coin will be chosen for the next edition.