Algorand Blockchain and its Properties
Blockchain is a decentralized and distributed ledger that can be used for storing information in multiple locations without any centralized monitoring system.
- Permanent and secure
Now as we know the defination of Blockchain but there are many different blockchain like Ethereum, Solana, Tezos, Algorand, etc.. But we are going to talk about Algorand Blockchain in this article.
Algorand is a decentralized blockchain platform for smart contracts with its native coin ALGO. It is a decentralized, self-sustaining, blockchain-based network that supports a wide range of applications.
- Algorand was founded by Silvio Micali, a Turing award winner, co-inventor of zero-knowledge proofs, and a world-renowned leader in the field of cryptography and information security.
- The three key elements are security, decentralization, and scalability, and usually, one of them is compromised for the sake of the other two in the blockchain.
- These three key elements are solved by Silvio and his team by inventing new Pure Proof of Stake (PPoS) consensus protocol.
- Algorand uses a pure proof-of-stake(PPoS) protocol built on Byzantine consensus.
- PPoS works by selecting a block proposer and a set of voting committees at each block round, to propose a block and validate the proposal, respectively.
- The proposer and committees are randomly chosen from the pool of all token holders (the accounts that hold algos) 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. in the network (i.e. how many algos it has relative to the whole).
- There are a bunch of really cool cryptographic algorithms that go into this process, with fancy names like “verifiable random functions(VRF)” and “cryptographic sortition” to ensure that the vote is fair, no one can collude, and that the overall system is highly secure. I won’t get into the details in this guide, but I highly recommend to chech these out from other resources.
Now , as we discuss about Algorand ,It’s consensus protocol let ‘s discuss about properties .
- Algorand is completely open and permissionless. Anyone, anywhere in the world, who owns Algos can participate in consensus.
- On Algorand, since the protocol is open and permissionless, nodes can and do exist all over the world.
- How do we know that anything that Alogorand foundation are telling us is true? We can check it because all of the code for the core protocol is open source. Anyone can review it and contribute to it.
- The Algorand source code is available here
Forking (or lack of)
- Forking is when a blockchain diverges into two separate paths. Sometimes this forking is intentional, like when a significant part of the community wants to change the fundamentals of the protocol. Other times this forking is accidental and occurs when two miners find a block at almost the same time.
- Since Algorand is pure proof-of-stake and uses a voting mechanism to validate blocks, forking is impossible. In a worst-case scenario, if the committee is taking longer to reach an agreement, the blockchain will slow down or temporarily stall.
- The speed at which blocks are produced, the number of transactions that can fit into a block, and when those transactions are considered final are important factors to consider when choosing a blockchain. For Algorand, performance is and will always be a key focus area for the core development team.
- On Algorand, blocks are produced every 4.5 seconds and can hold up to 5,000 transactions, which results in a throughput of about 1,000 transactions per second (1000 TPS).
- In proof-of-work blockchains, since forking is a possibility, transactions can’t be considered final until a certain amount of time passes and the likelihood of the transaction is on an orphaned chain is practically zero. This means that the actual throughput of this type of blockchain is caveated by a delay in finality. Downstream processes in an application must take this into account to avoid compounding issues if a transaction ends up being invalid.
- As it is mentioned earlier, Algorand does not have forking so transactions are final as soon as they are confirmed in a block. A throughput of 1,000 TPS then actually means 1,000 finalized transactions per second.
Note : Above image is before the Ethereum merge. After merge, Ethereum is Scalable and it uses Proof of Stake as consensus mechanism and Transaction Throughput is 1,500–4,000
So Algorand is a Blockchain which satisfies blockchain trilemma, uses Pure Proof of Stake (PPoS) as consensus mechanism and ALGO is its native currency.
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