Algorand

Lore & Background

Algorand was founded in 2017 by Silvio Micali, a computer scientist and professor at the Massachusetts Institute of Technology (MIT). Algorand's test network was launched to the public in April 2019. The main Algorand network was officially launched in June 2019. The SEC has named ALGO as an unregistered security in several lawsuits against cryptocurrency exchanges, and as of the current knowledge cutoff, no joint interpretive release from the SEC and CFTC has identified ALGO as a digital commodity.

Reader's Guide

Algorand can only be forked intentionally through soft forks and source code forks. Algorand uses a Byzantine agreement protocol that leverages proof of stake, which contributes to its energy efficiency. The Algorand Foundation funded an article which claims Algorand's overall protocol framework is sound under certain conditions. The core principle of Algorand consensus is the cryptographic 'self' sortition. The sortition procedure runs locally and privately, on each node of the network participating in the consensus protocol, without a centralized coordination. The goal of the sortition algorithm is randomly selecting a subset of users participating in the consensus protocol (committees) ensuring two properties: the sortition's result can be easily verified once it is published, while it can not be determined ahead of time by malicious adversaries. The number of selected users in the sortition (committee size) is defined as a statistical expectation on the outcome of a pseudo-random process. The likelihood that a given user will be selected (in the committee) is influenced by the number of ALGO tokens held by that user (the stake). Algorand's consensus steps are: block proposal, proposals filtering (soft vote) and committing the block (certify vote). In the first step the cryptographic sortition selects a subset of users (proposal committee) which assemble and propose a block for the next round of the protocol. At the end of the step there will be a few block proposals (the protocol is tuned with a statistical expectation of 20 proposals) with different random priorities. After determining if a user is on the proposal committee, that user can build a proposed block and gossip it to the network for review/analysis during the second phase. The user includes the result of the VRF (h) and cryptographic proof (π) in their block proposal to demonstrate committee membership. In the second step the nodes in the network wait for an adaptive period of time (λ), measured by nodes' local clocks, to be sure that the block proposals gossiped in the previous steps have been observed. A new cryptographic sortition selects a subset of users (soft vote committee) to vote and reach a Byzantine Agreement (called 'BA') on the proposal with highest priority.

Did You Know?

• In 2019, Algorand became a partner of World Chess.
• In 2021, Italia Olivicola, Italy's largest olive and olive oil producers' organization, partnered with Euranet to implement blockchain technology based on Algorand to attempt to address olive oil adulteration.
• SIAE, the Italian Society of Authors and Publishers, announced a project on copyright management using Algorand in 2021.
• In 2022, Algorand's blockchain was used by Robert Irwin and the Australia Zoo for a series of NFTs.
• In January 2023, Fideiussioni Digitali, Italy's initiative to reduce fraud in bank and insurance guarantees, selected the Algorand blockchain for a project to address fraudulent bank guarantees.