Read this article in German or Italian.
Can a blockchain be decentralized, scalable and secure at the same time? And can it also be sustainable? Algorand is the protocol that wants to answer yes to these two questions, trying to solve the blockchain trilemma while being ecological and user-friendly. Find out what you need to know about Algorand and its native ALGO token.
Algorand in a few words
Founded in 2017 by Turing Prize winner Silvio Micali, with his native ALGO token, Algorand is a blockchain protocol of many talents. Now ranked in the top 20 cryptocurrencies by market capitalization, Algorand (ALGO) is unlicensed, “without fork”And open-source, running on what its founder defined as a Pure Proof of Stake consensus mechanism and appears to be the first carbon-negative blockchain protocol.
Aiming to resolve the “trilemma”Of blockchains, Algorand wishes to offer its users a decentralized, scalable and secure blockchain protocol, while being environmentally friendly and sustainable.
Algorand’s talents in detail
Join the club of those altcoins which offer solutions to provide decentralized finance and smart contracts to the masses – see also Avalanche (AVAX) and Solana (SOL) – Algorand is endowed with many talents that deserve to be mentioned:
- Without authorization: the Algorand blockchain is open to everyone, without requiring the approval of any group of users or authorities.
- Open source: Algorand is a transparent project, which means that all information and developments are available to all interested parties.
- Pure proof of participation: in this consensus mechanism, each user staking out at least one (1) ALGO can participate in the creation of blocks. In full PoS mode, minors are not required to have special equipment and the energy consumption of the process is limited. Unlike the traditional Proof of participation, the creators of blocks are not chosen primarily on the basis of their wealth, but instead, they are selected at random. With Pure Proof of Stake, the probability of being chosen is proportional – but not limited – to their total amount of ALGO wagered. This consensus mechanism is intended to increase decentralization, as low-stake requirements make it easier to participate from anywhere. In addition, the security is high, as the random selection represents a major obstacle for attackers.
- Without fork: one of the advantages of the Algorand consensus protocol is its immediate purpose of the transaction. When a proposed block is chosen, the decision and the associated transaction are final and cannot be changed. The mathematical likelihood of a fork has been proven be so low that it’s not even worth considering.
- Carbon negative: run on Pure Proof of Stake instead of Proof of work Already limits Algorand’s carbon footprint, but the protocol decided to take sustainability to the next level. Indeed, thanks to its partnership with Climate Trade, Algorand offsets its CO2 emissions and is now a blockchain with a negative carbon footprint.
Algorand (ALGO) vs. Ethereum (ETH)
As always, talk about DApps and smart contracts easily take us to the second largest cryptocurrency, Ethereum. As we do with all of our tokens in the spotlight, let’s see how Algorand stacks up against the crypto giant, given that the ETH 2.0 upgrade Bringing consensus from Proof of Work to Proof of Stake is still in progress.
How to start your research
When it comes to researching how to invest, it pays to set the bar high. For cryptocurrencies and altcoins, a good place to start is the official website for the asset you’re looking for, such as Algorand official website. There you can dive into the projects, use cases, and technical data of the protocol, and find out more to explore.
Also, don’t forget to think about what kind of profit you are looking to generate from your assets. When looking for a coin, ask yourself how that crypto would fit into your investment wallet, and if you lean for low risk, long term investments or you are comfortable with faster and (perhaps) profitable investments, but higher risk investments.
Where to buy ALGO?
At Bitpanda, SOMETHING in a few clicks via your smartphone or computer. Bitpanda’s easy-to-use interface makes it easy to invest in crypto and other digital assets.