Mr. Market thinks the Algorand (ALGO) cryptocurrency offers some value. Algorand was CoinMarketCap’s ninth most trending cryptocurrency on 2 January 2023.
Additionally, Algorand was CoinMarketCap’s 32nd ranked cryptocurrency on 4 January 2023. However, CoinMarketCap gave Algorand a 18.56₵ Coin Price on the same day. Hence, people will wonder what is Algorand and does it offer any value?
They call Algorand an “institutional grade blockchain.” They claim Algorand is decentralized, scalable, secure, and environmentally sustainable. However, I think Algorand’s biggest value is in its most impressive user.
Italy’s Central Bank is using Algorand (ALGO)
Italy’s central bank, the Banca D’Italia or Bank of Italy, has chosen Algorand as the public blockchain for its Digital Sureties Platform. The CETIF, the Research Center for Technologies, Innovations and Finance of the Catholic University of Milan, chose Algorand as the basis for its digital sureties platform.
CETIF is supervising a project to create a blockchain for Italy’s banking system. Over 30 financial institutions, the Bank of Italy, and the Institute for the Supervision of Insurance, or IVASS, will operate the Digital Sureties blockchain. The IVASS is the agency that regulates Italy’s insurance Italy.
This effort is part of Italy’s National Recovery and Resilience Plan (NRRP) which the European Union is funding. Algorand is the only blockchain this platform will use.
“We selected Algorand because of its unparalleled level of innovation and security among permissionless DLTs, as well as because of its leadership in sustainability,” Professor Federico Rajola of CETIF said.
Thus, they could use the Algorand blockchain in an Italian Central Bank Digital Currency (CBDC) or a Euro CBDC.
What is Algorand (ALGO)?
Algorand (ALGO) is an effort to build a faster and more scalable blockchain they can use in the “real world.”
One use of Algorand is building more powerful smart contracts. Smart contracts are digital machines that perform tasks on the blockchain. Smart contracts are the basis of many blockchain constructs, including stablecoins.
They claim developers can build sophisticated decentralized apps (dApps) on Algorand with the Algorand Virtual Machine (AVM). Insurance companies, for example, could build a dApp that collects premiums or makes annuity payments.
The AVM is the digital computer that runs Algorand. They claim the AVM runs on every node of the Algorand blockchain. The AVM contains a stack engine that executes smart contracts and smart signatures.
Plus, they claim the AVM can write smart contracts in the Python or Reach computer languages. They also have another language they call TEAL, or Transaction Approval Language. TEAL is the language they write Algorand smart contracts in. Interestingly, the AVM evaluates smart contracts.
Smart signatures use logic to sign transactions and verify individuals. The smart signature is part of the transaction.
Algorand Advantages
They claim Algorand can process over 1,000 transactions per second. They also claim Algorand finalizes transactions in less than five seconds.This enables instant settlement of transactions, which reduces risks by giving hackers fewer points to attack transactions. They also claim Algorand operates at the low cost of 0.001 Algos.
An interesting feature of Algorand is contract-to-contract calls. This means Algorand smart contracts can communicate with each other and contract business.
A Blockchain for Financial Services
They claim Algorand Smart Contracts could execute many transactions on the blockchain. Those transactions include loan payments, subscriptions, disbursements, limit orders, collateralized obligations, programmatic fees, fee executions, escrow account creation, high-security account management, decentralized exchange transactions, crowdfunding, voting, data provider interfaces, and Home Equity Lines of Credit (HELOCs).
Thus, Algorand could serve as a blockchain for the banking and insurance industries, which could give it enormous value. Algorand’s use by the Bank of Italy could convince many financial institutions to adopt it.
One reason financial institutions could adopt Alogrand is that has an impressive founder, Silvio Micali. Miacali is on the faculty of the Massachusetts Institute of Technology’s (MIT) Electrical Engineering and Computer Science Department. In particular, Silvio is the co-inventor of probabilistic encryption, Zero-Knowledge Proofs, Verifiable Random Functions and many of the protocols that are the foundations of modern cryptography.
Micali won the Turing Award, the Gödel Prize in theoretical computer science, and the RSA prize in cryptography. Micali is a member of the US National Academy of Sciences, the National Academy of Engineering, the American Academy of Arts and Sciences, and the Accademia dei Lincei.
Thus, Algorand is the creation of an impressive scientist and honored academic which adds to its credibility. Micali oversees all of Algorand’s research.
Algorand and FIFA
They are using Algorand to power FIFA Collect. FIFA Collect is FIFA’s marketplace for licensed digital collectibles based on FIFA’s 92-year history of football and soccer history. FIFA has a partnership with Algorand (ALGO). In the partnership, Algorand will help FIFA build NFTs and other digital assets.
The FIFA Collectibles are nonfungible token (NFT) trading cards and other items fans can buy and sell through the marketplace. Hence, the organization that governs the world’s most popular sport and sponsors the World Cup is using Algorand.
Projects in the Algorand Ecosystem include Dequency, STOI, ANote Music, Meadow Labs, Al Goana, Opolous, Algofi, Yield, Folks Finance, Humble Defi, Venue One, xBacked, Flex NBA, Zone, The Drone Racing League, Lofty, TigerChi NFT Project, Algodex, Bleumi Payent for Algorand and ASAs, NF Domains, @Pay, Prismatic, Algomint, XP Network, Abris.io, AB2 Gallery, ZestBloom, Aorist, Dartroom, Artquare.io, AlgoFund, Kaafila, Thinkin, Green Earth Blockchain Project, Openfabric, and Magma.
What Value Does Algorand (ALGO) Offer?
Mr. Market gives Algorand (ALGO) some value. CoinMarketCap gave Algorand an 18.56₵ Coin Price, a $1.324 billion Market Capitalization, an $1.8856Fully Diluted Market Cap, and a $52.304 million 24-Hour Market Volume on 4 January 2023. Algorand was CoinMarketCap’s 32nd ranked cryptocurrency on 4 January 2023.
Algorand also had a $51.981 million Centralized Exchange (CEX) Volume, and a Decentralized Exchange (DEX) Volume of $272,022 on 4 January 2023. They based those numbers on a Circulating Suppy of 7.134 billion ALGO, a Maximum Supply of 10 billion ALGO, and a Total Supply of 7.356 billion ALGO.
In contrast, CoinGecko gave Algorand an 18.55₵ Coin Price, a $1.324 billion Market Cap, a $59.004 million 24-Hour Trading Volume, and a $1.857 billion Fully Diluted Valuation on 4 January 2023. They base those numbers on a Circulating Supply of 7.134 billion ALGO, a Total Supply of 7.56 billion ALGO, and a Maximum Supply of 10 billion ALGO. Algorand was CoinGecko’s 33rd ranked cryptocurrency on 4 January 2023.
If you are seeking a cryptocurrency and blockchain protocol, that could have real world value. Algorand is worth examining. I think the Bank of Italy and FIFA’s use of Algorand could give it enormous potential value.
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