Basic Facts
Algorand blockchain was founded in 2017 by Silvio Micali, and launched its mainnet in June 2019.
Algorand is a fully decentralized, secure, and scalable Layer 1 blockchain.
The total $ALGO supply is 10,000,000,000A and the circulating supply is 7,249,000,000A.
Algorand can process 6000 transactions per second (irrespective of transaction complexity and volume) and will be capble of processing 10,000 transactions per second and even 46,000 tps in the future.
Algorand Finality is currently 3.4 seconds and the block proposal time is 0.5 seconds.
The transaction fee is 0.001A (~$0.00011).
Silvio Micali (Founder)
Silvio has been on the faculty at MIT, Electrical Engineering and Computer Science Department, since 1983.
Moreover, Silvio is the co-inventor of probabilistic encryption, Zero-Knowledge Proofs and many other protocols that are the foundations of modern cryptography.
He is a recipient of the Turing Award in computer science (the Nobel Prize of computer science), in addition to the Gödel Prize (in theoretical computer science) and the RSA prize (in cryptography).
The Blockchain Trilemma
(Security, Scalability and Decentralization)
The Algorand protocol designed to solve three of the biggest problems most blockchains face: security, scalability and decentralization ("The Blockchain Trilemma").
Security
The Algorand protocol is secure against malicious attacks, making it ideal for transacting, holding high-value assets and building secure enterprise applications.
It maintains security on both network and consensus protocol (PPoS) levels and protects individual user's accounts.
Scalability
As of today, Algorand can process over 6000 transactions per second (tps) soon to become 10,000 tps with deterministic and instant finality.
On top of that, it's introducing a feature known as block pipelining to boost the tps performance to more than 45,000, which will make it more scalable than Visa.
Finality
In most blockchains, the receipt of a transaction is not a guarantee that the transaction is valid.
In order to gain confidence that the transaction is indeed valid, we need to wait for multiple blocks to be created. And each new block exponentially increases the probability that the block is valid.
Because of this, these networks can fork and split into various variations of the same blockchain.
However, Algorand operate differently from other blockchains. It has one block finality.
That means, after one block, you know with confidence that the block is valid.
The Process (source):
First, we agree on one block before producing or starting the generation of the next block.
But our agreement on the block is so fast, and in few seconds we already have produced the block, circulated it and agreed on it.
Then we start working on the next block or transaction.
So, by agreeing on the block, our blockchain never forks and that is really a big advantage over other chains.
Because not only do you want to add the blocks quickly, but you also want to add them with finality.
If in a typical blockchain you see a payment made to you in the latest block, you should not necessarily ship the goods,
because if there is a fork, the blockchain will go in another direction and the block with your payment may actually end up on the short fork, which will disappear.
Decentralization
Algorand protocoal is entirely decentralized with no central authority or singular focus of control.
Transactions are verified by participating nodes in the network and each node has an equal say in decision-making. This makes Algorand a very decentralized system.
Everyone on the network also has a chance of being part of the committee of users that approve each block because the selection is both random and confidential. There is no fixed committee and its nodes are run by people from all over the world.
Another concern regarding decentralization is that Algorand have relay nodes. In Algorand only communicate, and they do not perform consensus and can't sign transactions.
Althougt the protocol is fully decentrlized, the circulating supply of $ALGO tokens isn't fully decentrlized yet. But the foundation slowly distribute tokens to the market and this issue will be solved by 2030
(as you can see in this Algo Tokenomics Report).
Pure Proof of Stake (PPoS)
Algorand uses a pure proof-of-stake (PPoS) protocol built on
Byzantine consensus.
Each user's influence on the choice of a new block is proportional to its stake (number of tokens) in the system.
Users are randomly and secretly selected to propose blocks and vote on block proposals. All online users have the chance to be selected to propose and vote.
The likelihood that a user will be chosen, and the weight of its proposals and votes, are directly proportional to its stake.
Algorand's PPoS approach ties the security of the whole economy to the honesty of the majority of the economy, rather than to that of a small subset of the economy.
The system is secure when most of the money is in honest hands.
With other approaches (outlined below), a small subset of the economy determines the security of the whole economy, which means just a few users can prevent other users from transacting.
In Algorand, it is impossible for the owners of a small fraction of the money to harm the whole system, and it would be foolish for the owners of the majority of the money to misbehave as it would diminish the currency's purchasing power and ultimately devalue their own assets.