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Algorand

Algorand

Algorand is a company implementing an open source public ledger and cryptocurrency payment system utilizing the Byzantine Agreement message-passing protocol to reach consensus among network participants.

Algorand is a company implementing an open source public ledger utilizing the Byzantine Agreement message-passing protocol to reach consensus among network participants. The Algorand protocol is still in the development phase and is designed to be a blockchain-based payments platform.

Funding

The developers of Algorand, including MIT professor and Turing Award winning Silvio Micali, have raised $64 million dollars in funding from venture capital firms including Pillar and Union Square Ventures. Stock investment in Algorand comes with an option for conversion into tokens.

Consensus mechanism

The consensus mechanism enabling the blockchain operates in one of two environments; permissioned or permissionless — similar to a proof of stake protocol. This allows minimal computation to be an honest block producer. The blockchain assumes that 2/3 of the block producers are honest and not adversarial or Byzantine.

Secret self-selection

Algorand is developing an approach to decentralized consensus that relies on secret self-selection in order to determine new block generators and validators.

Users run a verifiable random function based on a seed generated in the previous block to select a leader, who is in charge of proposing the next block, and members of a committee who are responsible for voting on the validity of that block. This cryptographic lottery results in a rotating, random selection of committee members who are self selecting. Committee members run the computation to see if they won the lottery trivially, and in secret so they do not reveal their identities until they pass their message, or vote to the network with a credential in the form of a digital proof or signature. This secrecy is intended to improve network resilience against committee member corruption from a malicious adversary by obfuscating the identity of the committee until after they have propagated their information to the network.

Player replaceability

The Byzantine Agreement process takes multiple steps, introducing a vulnerability where adversaries may corrupt committee members after they have revealed themselves in the first step. Algorand seeks to solve this issue by having each step in the Byzantine Agreement process performed by a player-replacable protocol in which the committee members are swapped out at each step in the protocol — making the adversary unable to predict the committee member in any step until after they have performed their task.

Forking probability

The probability of a fork in the protocol is estimated at 1/1,000,000,000 and therefore blocks can be considered final upon validation.

Network Assumptions

Security assumes an honest majority of 2/3 of online nodes. The protocol also makes a message propagation assumption whereby all messages reach honest users in a timely fashion.

Incentives

Algorand does not incentivize or financially reward honest block generators for honest creation of blocks. This is a significant departure from the strategies employed by almost all major cryptocurrencies which reward in the form of minted coins given to block producing nodes in the network.

Criticisms

Critics of Algorand assert the assumption of 2/3 honest nodes may not be fulfilled if honest nodes simply go offline without a monetary incentive to stay online; this is known as the lazy validator problem. Other decentralized systems have maintained network integrity without financial incentives like BitTorrent, and some non-mining aspects of Bitcoin. Given the potential monetary incentive for adversarial nodes, the robustness of non-incentive based blockchains remains an open question.

Yongge Wang with his recent paper "Another look at ALGORAND" (May 11, 2019) says it is possible to fork Algorand even with 1/3 malicious users and possibility to bribe validators easily is not unrealistic.

Timeline

June 10, 2021
Arrington Capital Launches $100m Algorand Ecosystem Fund
October 24, 2018
Algorand Secures $62M

The $62M comes from a broad global investment group representing the venture capital, cryptocurrency, and financial services communities.

February 16, 2018
Algorand announces $4 million in funding

Algorand announces $4M in funding from Pillar and Union Square Ventures.

February 2018
Algorand raises a $4,000,000 seed round from Pillar and Union Square Ventures.

Funding rounds

People

Name
Role
LinkedIn

Georgios Vlachos

Nickolai Zeldovich

Rotem Hemo

Sergey Gorbunov

Yossi Gilad

Further reading

Title
Author
Link
Type
Date

Algorand

Jing Chen, Silvio Micali

Academic paper

Algorand: Scaling Byzantine Agreementsfor Cryptocurrencies

Yossi Gilad, Rotem Hemo, Silvio Micali, Georgios Vlachos, Nickolai Zeldovich

Academic paper

Algorand’s Instant Consensus Protocol – Algorand – Medium

Georgios Vlachos

Blog post

Illuminating The Dark Age Of

Blockchain: Algorand

Ninos Mansor, Omar Yehia, Ninor Mansor (Arrington Capital)

Research Report

July 19, 2021

MIT Professor Raises $4 Million to Build a Better Blockchain

Stan Higgins

News article

No Incentive? Algorand Blockchain Sparks Debate at Cryptography Event

Amy Castor

News article

Optimal and Player-Replaceable

Silvio Micali and Vinod Vaikuntanathan

Academic paper

Scaling Consensus? This Turing Winner Thinks He's Found a Way

Amy Castor

News article

Documentaries, videos and podcasts

Title
Date
Link

CESC2017 - Silvio Micali - ALGORAND

Oct 16, 2017

FSR Event: Blockchain & the Future of Financial Services

May 10, 2017

Prof. Silvio Micali: A New Scalable and Secure Approach to Byzantine Fault Tolerant Consensus (169)

Feb 7, 2017

Companies

Company
CEO
Location
Products/Services

News

Title
Author
Date
Publisher
Description
October 12, 2021
The Economic Times
Bitcoin climbed above $57,000 for the first time since May as speculators bet that the largest cryptocurrency will retest the record highs reached earlier this year.
Omar Faridi
July 15, 2021
Crowdfund Insider
Ledgermatic, a treasury, finance, custody solution, is now live, and it is compatible with Algorand ecosystem.
Algorand
June 10, 2021
www.prnewswire.com:443
/PRNewswire/ -- Arrington Capital, a digital asset management firm in blockchain-based capital markets, today announced it has launched a new $100 million USD...
Algorand
June 9, 2021
www.prnewswire.com:443
/PRNewswire/ -- Xfinite and Eros Now, a leading over-the-top (OTT) South Asian entertainment platform owned by global entertainment company Eros STX Global...
MAPay, LLC
June 3, 2021
www.prnewswire.com:443
/PRNewswire/ -- MAPay, a global healthcare technology firm with a focus on decentralized payment networks, today announced it will introduce its own stablecoin...
Algorand
June 2, 2021
www.prnewswire.com:443
/PRNewswire/ -- Exodus, a company focused on making cryptocurrency easy and accessible for everyone, today announced that its digital Common Stock Tokens that...
Algorand
June 2, 2021
www.prnewswire.com:443
/PRNewswire/ -- Algorand and Bnext join forces to revolutionize the remittances market in Europe and Latam. During 2020, Latam received more than 100bn USD and...
Christine Hall
April 2, 2021
Crunchbase News
We ask venture capital firms five questions about their investment strategies.
Buying.com
March 9, 2021
www.prnewswire.com:443
/PRNewswire/ -- Buying.com, a leading player in hyperlocal e-Commerce fulfillment and distribution, is launching its BUY token on the Algorand platform. This...
Algorand
January 7, 2021
www.prnewswire.com:443
/PRNewswire/ -- Instimatch Global, la plateforme numérique primée pour les transactions sur les marchés des capitaux institutionnels à court terme (marchés...
Algorand
January 7, 2021
www.prnewswire.com:443
/PRNewswire/ -- Instimatch Global, a premiada plataforma digital para o comércio institucional a curto prazo no mercado monetário, e a Algorand, uma blockchain...
Algorand
January 7, 2021
www.prnewswire.com:443
/PRNewswire/-- Instimatch Global, la galardonada plataforma digital para el comercio institucional a corto plazo en el mercado monetario, y Algorand, una...
Algorand
January 7, 2021
www.prnewswire.com:443
/PRNewswire/ -- Instimatch Global, het bekroonde, digitale platform voor institutionele, kortlopende valutahandel, en Algorand, een toonaangevende blockchain...
Algorand
December 10, 2020
www.prnewswire.com:443
/PRNewswire/ -- Stablecorp, the firm behind the issuance and management of the QCAD (the Canadian Dollar stablecoin), announced a partnership with Algorand,...
FinSMEs
May 16, 2020
FinSMEs
About | Advertise | Contact | Disclaimer | News | The Daily Deal Newsletter FinSMEs.com by FinSMEs is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License.
Mars W. Mosqueda Jr.
Invalid Date
DealStreetAsia
Blockchain-focused venture capital group Algo Capital has announced the closing of its new VC fund - Algo VC Fund - at $200 million.

References

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