Algorand ALGO

You may have heard about the relatively new blockchain Algorand, whose internal coin (ALGO) has grown 5 times in a year? In this article, we will tell you what Algorand is and what of its features help it to stay and grow in the market.

History

Algorand is a Proof of Stake (PoS) consensus cryptocurrency protocol focused on scalability and decentralization. The core network was launched in June 2019 by MIT professor Silvio Micali.

Managing

Management of Algorand is shared between the company and a foundation led by cryptographer Tal Rabin. The foundation handles the chain management and decentralization of Algorand's network, including nodes. Prize funding and cryptographic research are also the responsibility of the foundation.

Design

"Blockchain trilemma" is the claim that any blockchain system has two of the three properties: decentralization, scalability and security. Algorand addresses this issue with nodes that allow moderate consumer-level resources and scalable transaction processing.

Consensus algorithm

Proof of Stake (PoS) consensus algorithm requires three steps to offer, confirm and write a block to the blockchain.

During the first step (the block offer phase), the system uses "cryptographic sorting" to select a committee of users to offer a new block. Each user determines whether he is part of the committee by locally performing a verifiable random function (VRF). The probability of successfully entering depends on the number of ALGO tokens that the user owns (share). The user can then create a block and distribute it to the network for review and analysis.

In the second phase (the block completion phase), the users on that voting committee analyze the proposed blocks and vote on whether to accept any of them. If the voting committee reaches consensus on a new block, the new block is distributed across the network.

Membership on both committees changes each time the phase is executed, which helps protect users from targeted attacks because the attacker will not know in advance which users will join the committee.