Will Algorand Pick Up Momentum Again?

user-image
DongHyun Kang
Research Associate/
Xangle
Jul 31, 2023

Table of Contents

1. Algorand, the Blockchain Created by Silvio Micali, the godfather of cryptography

2. Algorand's Strengths: Robust Technology Contributing to an Enhanced UX

2.1. Dual Node Structure Improves Network Decentralization

2.2. Pure Proof-of-Stake System Enhances Algorand's Scalability

3. Algorand's Challenges: Collaborating with Less Sustainable Institutions and Countries, and Expanding the Ecosystem

3.1. Collaboration with Less Sustainable Organizations and Countries

3.2. Low Ecosystem Maturity

4. Algorand’s Resurgence: AlgoKit Facilitates Aggressive Marketing and Developer Onboarding

4.1. Aggressive Marketing and Expanding Target Market

4.2. Expanding Supported Languages and Simplifying Development Process with AlgoKit for Web2 Developer Onboarding

5. Notable DApps in Algorand

5.1. Folks Finance

5.2. Lofty AI

6. Closing Thoughts

 

 

1. Algorand, the Blockchain Created by Silvio Micali, the Godfather of Cryptography

Along together with Cardano and EOS, Algorand emerged as a prominent mainnet claiming to be a third-generation blockchain that could solve the blockchain trilemma. The project was founded by Silvio Micali, a distinguished MIT professor and a pioneering figure in cryptography. In 2012, he was honored with the Turing Prize for his groundbreaking contributions to Verifiable Random Functions (VRFs) and zero-knowledge proofs, which have now become widely used in the crypto industry. His profound expertise in cryptography has been instrumental in shaping Algorand's strong technical foundation.

However, Algorand's ecosystem growth has been slower than expected, despite its initial promising launch. Nevertheless, Algorand's technical strengths and the esteemed reputation of Silvio Micali have facilitated partnerships with various organizations and countries.

In this article, we will delve into a comprehensive analysis of Algorand’s technical strengths. Furthermore, we will examine the current challenges and explore potential opportunities that lie ahead for Algorand.

2. Algorand's Strengths: Robust Technology Contributing to an Enhanced UX

One of the key pillars of Algorand's strengths lies in its technical capabilities, which are backed by Silvio Micali's expertise in cryptography. This technical capability is a driving force behind Algorand's ability to provide a seamless user experience. In this section, we'll take a closer look at Algorand's technology.

2.1. Dual Node Structure Improves Network Decentralization

In its endeavor to solve the blockchain trilemma, Algorand adopts a structure that categorizes nodes based on their roles in relaying, participating in the consensus process, or archiving data. First, relay nodes do not partake in block creation and consensus. Instead, they serve as data interconnection points, relaying block data that has completed the consensus process at participating nodes. In other words, relay nodes are responsible for facilitating communication between nodes. They also serve as archives, storing blockchain data to speed up the process of block creation and consensus by propagating blocks between relay nodes.

A participating node is a node that engages in block generation and consensus based on the stake it holds. These participating nodes are also connected with several relay nodes and relay the consensus processes to the relay nodes. Unlike relay nodes, participating nodes do not archive all block data. Instead, they store the 1,000 most recently created blocks to ensure accurate validation. Indexers and record submission nodes, on the other hand, do not participate in relaying and consensus; they can be set up for their specific purposes, such as on-chain data usage and transaction submission. The structure of relay nodes and participating nodes is illustrated in the figure below.