Need help?
Search not found
Search not found
Select your language
Search not found
Need help?
Обзор популярной криптовалюты Algorand - Binaryx

Algorand: Everything You Need To Know

Have you ever wondered if there’s a cryptocurrency with unlimited scalability? Moreover, a hard fork is not possible in its blockchain. At first, it seems fantastic, but recently such a project was launched – the digital network Algorand. The developers call it the world’s first Pure Proof of Stake (PPoS) blockchain designed to extend smart contracts’ functionality. Let’s figure out what’s interesting about this project.

What is Algorand?

Algorand is a new digital network that makes the traditional financial system more efficient. It uses a protocol to ensure the smooth circulation of coins. All this became possible thanks to the support of ASC1 smart contracts. They are integrated into the first level of the Algorand.

Clients of the network can automatically apply custom transaction rules, as well as their logic. You can specify everything from how assets are transferred to complex application logic. Smart contracts ASC1 were written in a new programming language – Transaction Execution Approval Language (TEAL). Also, some parts are created through PyTeal (python language binding).

The Algorand developers aim to solve one of the most critical problems of any blockchain – creating a platform with limited scalability that will remain decentralized.

The project team understands that mass implementation of the blockchain is difficult without such a solution. Now, this can be seen in the example of top crypto coins – Bitcoin and Ethereum. Although they have gained immense popularity, the scope of their use is still narrow. There is only one problem – transactions are too slow for the modern economy. However, the development of scalability, decentralization, and security must also be considered. It’s all because these parameters are also essential for the blockchain’s successful functioning.

Also, the Algorand network reduces the computing power requirements for transactions. Thus, it’s a reliable and decentralized platform with low transaction fees.

The Algorand project looks so promising that even governments are interested in it. Marshall Islands Cabinet signed a strategic partnership agreement with the company. Based on the Algorand blockchain, the state crypto coin SOV (digital sovereign of the Marshall Islands) will be created.

ALGO features

ASC1 smart contracts enable the creation of business models for various human life areas that support efficient operations and applications. It allows you to create smart agreements without the need to establish mutual trust.

Main features:

  • creating complex applications using TEAL;
  • scalability, speed, and security of dApps;
  • low risks in mutual settlements.
  • low transaction processing costs;
  • low threshold for entry;
  • flexible implementation of smart contracts with the ability to create custom scripts.

There are no blockchains in the crypto universe yet that offer an easy way to manage an account. The developers have created private keys. They allow you to protect accounts within the network, as well as increase their security. The latter is also possible using a hardware wallet or multisig. Besides, private keys allow you to create separate spending policies for automatic recurring payments.

What is Vault

Vault is a unique blockchain compression algorithm designed to improve system performance. Thanks to it, the nodes are no longer overloaded with transaction history since each transfer remains valid for a certain period. The wallet’s balance has nothing to do with the list of operations, so empty accounts are deleted.

However, the Algorand developers have provided a way to keep a permanent wallet address. The Vault algorithm uses a system called adaptive sharding. It means that each public address is tied to specific nodes (nodes). And transactions are verified using *the Merkle tree.

*Merkle tree (or hash tree) is a data structure represented as a binary tree. So, the “leaves” are the hashes of transactions, and internal nodes are the sum of the connected vertices’ values. In the cryptocurrency field, the Merkle tree is used to store transactions securely.

To add a block to a chain, it must meet some requirements:

  • the transaction in the block must remain active. To check a condition, the numbers of the first and last blocks, where it can appear in the chain, are specified in the code of transaction;
  • after adding a block, all accounts must keep the account balance above 0;
  • transactions in a block must be unique;
  • all transactions are displayed correctly in the hash tree.

Other features

Besides, the Algorand cryptocurrency network is interesting for the following things. For example, it proposes the Pixel digital signature scheme. It’s a technology that helps Algorand to reduce bandwidth requirements using the new system. The scheme is based on aggregating multiple signatures of a single message and turning it into a compact signature of the same length. At the same time, attackers cannot forge signatures in earlier messages.

There are also self-checking transactions. They are based on the separation of consensus and storage. Users will verify the validity of payments without the need to maintain a proper balance for block verification and individual payments.

Finally, Algorand plans to support atomic swaps further.

Algorand Consensus Protocol

It’s another exciting feature of the new cryptocurrency. It uses Byzantine fault tolerance, which is specially optimized for the high-performance blockchain. It is used as long as there’s a fair majority of ⅔ or more participants. When the leader of a given majority is doing work honestly, it only takes two steps to reach a consensus. Otherwise, it’s achieved in three steps.

To extend the protocol to more nodes, the developers have created a unique solution based on verifiable random functions (VRFs). This mechanism allows the participant to verify being elected to vote for the next block freely. Then, he/she includes proof of this fact in-network messages.

The Algorand digital currency protocol doesn’t require the long-term holding of current balance or transaction history records. Users only need to store their private keys. Transactions exist only at the time of their implementation, and accounts with zero in the account are erased. Hence, the blockchain can easily replace participants and avoid individual users’ attacks if their data is suddenly exposed.

Therefore, Algorand was created as a secure and highly efficient crypto storage and trading ecosystem with a random number of participants. Moreover, each of them can join or leave the network at any time without prior approval.

Appearance history and team

Algorand, Inc is the creation of one of the first professional cryptographers, Silvio Micali. He is a professor at the Massachusetts Institute of Technology (MIT) and a Turing Prize winner. Micali helped create Algorand by an impressive team of scientists, cryptographers, mathematicians, and economists. Among the leading specialists, it is worth noting such people:

  • Naveed Ihsanullah is a former Mozilla Process Engineer who helped develop the cross-functional Quantum Flow software. He also created and operated the Thought Labs consulting company.
  • Nickolai Zheldovich is a professor of electrical engineering and computer science at MIT, a member of the Computer Science and AI Laboratory at the Massachusetts Institute of Technology;
  • Jing Chen is an Assistant Professor in the Department of Computer Science at the State University of New York at Stony Brook. In 2016, he was the recipient of the National Science Foundation’s CAREER Award;
  • Sergey Gorbunov is an assistant professor at the University of Waterloo, founder and technical director of Stealth Mine.

The project was launched as part of IEO – an initial exchange offer. The Dutch auction was chosen as the format when the price is formed based on the coin’s real demand. After that, the ALGO asset entered trading in June 2019.

Mining opportunity

Many blockchains use the Proof-of-Stake algorithm. It has overshadowed the less green Proof-of-Work and rewards users for participating in transaction validation.

There are two types of PoS:

  • DPoS – in this case, the whole community chooses the validators, and the value of the vote depends on the current balance of the voter. After that, selected network nodes confirm transactions and take control of the blockchain;
  • BPoS (Bonded Proof of Stake) – in this case, a certain amount of coins is blocked on the validator’s account. If violations are noticed on his part, the deposit won’t be returned.

However, both methods have certain drawbacks. The main one is a high threshold for the selection of possible validators. Therefore, most users cannot be elected to confirm a transaction but only cast their vote. And this is where a new type of Proof-of-stake comes into play – PPoS (Pure Proof-of-stake).

Anyone who has ALGO coins on their account can become a validator here. The greater the balance, the higher the chances. In this case, you can leave the network at any time and not be fined. Such a policy makes the blockchain safer because it will be difficult for an attacker to guess who’ll be chosen as a validator.

Where to buy cryptocurrency? Available exchanges

The Algorand digital currency is now available on some major exchanges. And since the coin is in the top 40 cryptocurrencies in terms of market cap, it may appear at Binaryx exchange. Users will certainly be interested in this asset since many experts and reputable media include ALGO cryptocurrency in the list of the most promising ones.

Algorand wallets

The developers suggest storing coins on the Algorand Wallet online wallet. You can create it at

To register, you need to:

  • follow the link and click “New Wallet.”
  • accept the terms of the user agreement and create a strong password.
  • click “Create Wallet” and then save the seed phrase.
  • confirm saving, and enter the password from the wallet.

The Algorand Wallet interface can be accessed through a web browser or a Ledger cold wallet. There’s also a mobile app for Android and iOS devices.

Pros and cons of the project

Advantages of the AlgorandDisadvantages of the Algorand
Unlimited opportunities for network scalingPossible blockchain vulnerability
Impossibility of hard forkHigh competition in the segment of coins with smart contracts
Unique three-layer network security protocol
Decentralized nature
Low transaction processing costs

Development prospects

Now let’s talk about the future of Algorand. On the one hand, the project has pretty good prospects. After all, the coin is traded on large exchanges, and the protocol is simple. Due to the active growth of the DeFi market, investors will pay attention to a new system with unlimited opportunities and a top-notch team. But a lot will also depend on the right marketing and, of course, the developers’ dedication.

Will Silvio Mikali’s brainchild compete with Ethereum and other smart contract blockchains? It’s a matter of time.


Let’s sum it up. Algorand was created by experts in the fields of cryptography, maths, and economics. The launch of the mainnet allowed the developer to get support from large companies in traditional finance and Fintech. Hence, we can judge the strong interest in the new digital currency.

Innovative technologies have already upgraded the blockchain, and this revolution will proceed. After all, the new network offers everything to prevent hackers from gaining access to user data and their assets.

Algorand has already shown its technical and commercial potential. And despite the early stage of progress, this project is the one to look out for.

We use cookies to improve and personalize your experience. To find out more, please read and agree with our Cookies Policy.

Allow Cookies