Algorand: Everything to Know

Overview

Algorand is a blockchain platform that was designed to address scalability and uses a one-of-a-kind consensus algorithm called Pure Proof of Stake (PPoS). The point of PPoS is to achieve fast and secure transactions.

Algorand was designed to address the scalability and security issues that posed a concern for other blockchains. Algorand seeks to create a decentralized network that can support a wide range of applications, from financial services to supply chain management.

A Brief History

In 2017, Silvio Micali, a Turing Award-winning computer scientist from the Massachusetts Institute of Technology, founded the Algorand project. Prior to founding Algorand, Micali had made significant contributions to cryptography and computer science.

Micali's goal in establishing Algorand was to create a secure, scalable and decentralized blockchain platform. Algorand raised $66 million in a token sale in 2017 - one of the largest initial coin offerings (ICOs) at the time. The Algorand mainnet was launched in 2018, and the platform has grown steadily since then.

What is Algorand?

Algorand uses a unique consensus algorithm called PPoS, a variation of the proof-of-stake (PoS) consensus algorithm. The reason that Algorand uses PPoS is because of a PoS's weakness - possible centralization. PoS allows users to become validators by holding a certain amount of cryptocurrency on the network. Validators add new blocks to the blockchain and ensure that the network is secure. If a few validators hold a significant portion of the cryptocurrency, there is more opportunity for centralization.

PPoS resolves this concern by randomly selecting validators based on the amount of cryptocurrency held. This ensures no single validator can control the network. PPoS also accelerates block confirmation times. It adds new blocks to the blockchain every few seconds. This makes Algorand one of the fastest and most scalable blockchain platforms.

Algorand's unique feature, atomic transfers, allows for the simultaneous transfer of multiple assets between different parties. Atomic transfers are particularly useful for financial applications involving simultaneous transfer of multiple assets, like during trading.

Getting Started

• Save energy and be more efficient when validating transactions. PPoS guards against centralization.
• Utilize ALGO, the platform's native cryptocurrency. The Algorand community is governed by holders of this cryptocurrency.

Unique Aspects

• Speed and scalability. Algorand can process up to 1,000 transactions per second. This makes it significantly faster than many other blockchain platforms. It is one of the best blockchain platforms for high-volume applications like financial transactions and supply-chain management.
• Security feature. Algorand uses a Byzantine agreement protocol. This protocol ensures the network can reach consensus even in the presence of malicious actors. This means the Byzantine agreement protocol makes it virtually impossible for anyone to manipulate Algorand or alter the history of transactions on it.
• Built-in smart contract platform. Algorand's built-in smart contract platform makes it possible for developers to create and deploy decentralized applications on the network. Developers have an easier job of creating complex applications without having to worry about the underlying blockchain infrastructure.
• Unique governance model. Algorand's governance model allows users who hold ALGO to vote on key decisions related to the platform's development and future direction. This way of governing the community ensures Algorand remains decentralized and community-driven.