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The world of cryptocurrency is constantly changing. New platforms with their cryptocurrencies are emerging regularly. One blockchain platform that is grabbing the attention of many crypto enthusiasts is Algorand, along with its cryptocurrency ALGO. Algorand's capabilities can be explored with blockchain app development services. Let us explore the attributes of this platform in more detail.
What is Algorand
Algorand is a decentralized network that resolves the concurrent blockchain scalability trilemma of achieving speed, security, and decentralization. Scientist and MIT professor Silvio Micali launched Algorand in 2019.
Algorand is a live open-source blockchain project and blockchain platform. Thus, it supports the development of dApps and Defi on its secure and scalable network. Furthermore, it requires transactions without a central authority, less computing power, and easy-to-divide tokens to run the system.
The Algorand uses a Proof-of-Stake (PoS) consensus mechanism rewards for all holders of its native cryptocurrency-ALGO. This consensus algorithm uses an open-source permissionless blockchain protocol that can complete quick transactions. It also uses the Algorand Standard Asset (ASA) protocol to create new tokens.
Also, Read: Understanding the Blockchain and Decentralized Consensus Mechanism
How does Algorand Work
Algorand works on a pure-proof-of-stake (PPoS) consensus mechanism. This algorithm is better than Proof of Stake (PoS) since it gives equal opportunity to everyone.
There are two types of networks in Algorand - participation nodes and relay nodes. The job of relay nodes is to maintain connections between Algorands and serve as network hubs. Moreover, the participation nodes confirm the transaction and lend computing power. Thus, developers use relay nodes to communicate with each other and maintain the ledger participation nodes.
One of the main differences between cryptocurrency types is the difference between proof of work and proof of stake. The transactions and new blocks can come out faster with a pure-proof stake. Algo holder “confirm and approve” and chooses the next block in the chain every time there’s a new block.
According to the network’s developers, the action gives the Algorand blockchain a global, decentralized, and secure network. The Algorand network has the features of the top blockchain network that can manage smart contracts. It also permits building decentralized app development (dApps) on the way.
Benefits of Algorand
Today, the features of Algorand make it one of the most impactful and trustworthy crypto-currencies for business. This blockchain platform allows pure decentralization, speed, scalability, low transaction fee, and security.
The pure proof-of-stake (PPoS) has been a game-changer in the industry. It aids a capacity of more than 1,000 transactions per second. Moreover, you may observe an increase in this number over time. Similar to Bitcoin, it takes a layered path to scale.
Algorand uses a mixture of a layer-one network with a more limited scripting language with a more complex layer-two system. It is a better complex suited for smart contract development services.
What Makes Algorand Different
Every token holder must have at least one ALGO in their account to propose and add new blocks to the chain. There will be a new group or community for adding a new block. The community randomly picks an ALGO holder to validate and accept new blocks.
Users only need to keep their ALGOs in their official wallets to participate in a consensus. It confirms availability through a unique transaction called Going Online.
Benefits of Pure Proof-Of-Stake (PPoS)
PPoS increases security, making it impossible to trace and hack. It does not require solving complex calculations. Additionally, anyone can participate in its consensus process. Therefore, this mechanism promotes decentralization.
Algorand transactions are fast and less expensive than other blockchain transactions. They take about 5 seconds to confirm transactions with an average fee of less than $0.001. But, other Blockchain protocols take up to 15 seconds for transaction proof and about $15 for transaction fees.
Also, Read: Emerging Blockchain Use Cases and Solutions across Industries
Summary
The Algorand blockchain is a massive achievement, improvement, and advantage to blockchain solution adoption. Thus, we can say that Algorand can solve many existing Blockchain problems. Now, more people are adopting this blockchain protocol due to its many applications and partnerships.
For more information, you can connect with Oodles blockchain development experts.
