As an Algorand blogger, I have found myself answering the “What is Algorand?” question more times than I can count. I used to bring up the advantageous elements Algorand has: pure proof of stake, zero knowledge proofs, scalability, etc… but almost every time I did I was met with a blank stare.
To me, the blockchain is becoming more and more like the internet. How many of us can explain exactly how it works? How signals are sent, website pages are stored, and sites are powered? Probably not many. But every single one of us reaps the immense benefits of knowledge sharing and opportunity access that the internet brings. The blockchain, especially Algorand, is the exact same.
If you are someone who knows Bitcoin only by name, generally feel daunted by the mystery of the “blockchain”, and don’t have a technical background, this article is written for you. The goal of this post is not to deepen your technical understanding of cryptocurrency, but rather to illuminate all the new possibilities that Algorand unlocks.
The first point I’d like to address is the misconception that Algorand is just a currency or an asset that maintains value. It certainly has the functions of one, but it is so much more. If anything, Algorand’s main token $ALGO serves as a key which unlocks the incredible world that is the Algorand space.
Just like in the real world, everything in Algorand functions around the concept of ownership. In the real world you may have a real estate title, a car deed, and a season long sports pass. The Algorand space functions exactly the same way, except the proof that you own these things are stored in an online wallet. Instead of a physical basketball ticket, you have a permanent and unchangeable token that states you have the right to attend certain basketball games, and it sits in your virtual wallet. You can bring it up and show proof at any time. This wallet functions very similarly to how a physical one might, you can open it up and see everything you own, and you can send the assets you have in it to other people very easily.
Another misconception is that the Algorand “blockchain” is this daunting extremely high tech mechanism that the average person can never use. When I talk about using Algorand, people frequently think I’m doing some sort of high powered cryptocurrency “mining”. When in reality, I’m not doing much more than interacting with normal webpages with my connected Algorand wallet.
Note: The term “blockchain” can commonly lose people. Without getting technical, just think of the blockchain as a stored database that is secure, difficult to hack/change, and trustworthy without being controlled by one party.
The only things you truly need to get started on Algorand are an internet connection, a wallet (downloadable on the app store or as a browser feature), and a splash of common sense. Other blockchain networks like Ethereum involve more complicated wallet setups and feature harsh payment fees for transactions. This is what makes Algorand so incredible. It is a forgiving beginner friendly platform, which is barely more complicated than your mobile banking app yet has the most nuanced and advanced technology behind the scenes.
Projects on Algorand
In my opinion, Algorand’s growing ecosystem is the reason most people should follow along. It’s so easy to get started, and once you do there is so much to explore. So what can you do on Algorand that you can not do elsewhere?
Algorand takes traditional finance and makes it so much more accessible. Many barriers in traditional finance are created by the middleman that monitors and completes your transaction: The bank that holds your money and lends it out. The foreign currency exchange kiosk that shortchanges you at an airport. The hidden racial bias a mortgage-approval algorithm has1. All of these are consequences that arose out of the need for a middleman to ensure the security and safety of an exchange.
What makes Algorand so unique is that it completely negates the need for a middleman. On Algorand, exchanges can be completed synchronously and without trusting the other party. You can swap between two different Algorand currencies using protocols that execute based on publicly readable code. On Algorand, the average person can be a lender and a borrower. They can be a buyer and a seller. Protocols like Tinyman exist solely to make these exchanges possible.
One example to illuminate this is AlgoFi. You can borrow $ALGO against your other accepted cryptocurrency assets as long as you remain above a certain percentage backed. You can also lend $ALGO and receive returns proportional to what the market has set. You can hold coins that are pegged to the $US dollar, and receive inflation-beating returns for doing so.
The possibilities of Traditional Finance on Algorand are endless and grow by the day, though it is worth noting that regulation can get complicated here depending on what country you live in.
Investing in nontraditional ways
Investing in the real world is hindered by droves of red tape. You can not invest in early stage companies as an angel investor without having a high income or net worth. You need a record label to invest in a music artist’s work. On Algorand, these limitations do not exist. Here are three examples of investments only possible on Algorand.
Imagine if fans could invest in artists, instead of forcing them to go through record labels which take unfair, predatory cuts from artists’ profits. Enter Opulous. Opulous enables artists to sell music royalties (past and future) as collateral for loans which they can use to produce more music. They then allow these shares of music to be exchanged, creating a fully fledged market for investing in music. Recent sold out sales include Lil Pump’s Mona Lisa and Ard Adz’s Patek Myself.
Lofty AI takes real estate investing to the next level. Why should you need to have $800,000 to invest in a California house. What’s stopping 8,000 people with $100 each from making that investment? Enter Lofty, and their concept of tokenized real estate. Lofty allows you to purchase a proportional stake in real estate instead of the whole thing, and you can sell that stake at any time. No more getting priced out of housing markets and allowing only the wealthy to purchase real estate, Lofty is here to change the future of real estate investing.
In the real world, it is very difficult to invest in companies early on. Venture Capitalists or Angel investors are the only ones that can get in on early returns for innovative products and companies. On Algorand, it is the opposite. Companies and projects are able to get investments from users right from the start. This is made even easier by launchpads such as Yieldly, which recently kickstarted Play to Earn game Cosmic Champs token sale.
Note: Buyer beware. More freedom also means more individual responsibility to avoid being scammed. Fake projects and scams happen. Always research whether or not what you are investing in is legit.
Play to Earn Gaming
No doubt one of the most exciting applications of Algorand and blockchain in general is play to earn gaming. The concept is tremendously simple: imagine if every asset you owned in game could be traded and sold to other players. You’re playing Pokemon and you come across a rare item. You’re playing World of Warcraft and obtain basic supplies from slaying a monster. On Algorand, all of these things can be exchangeable. Not just for currency, but for other items on different games. Soon there will be a completely interconnected virtual gaming economy, where value is determined by supply and demand. On that note, there are a couple awesome Play to Earn games currently live on Algorand.
Alchemon: A Monster Card Collecting battle game. You field a team of three “Alchemon” and battle against other players and computers to earn rewards. The game is currently in Beta (pre-launch) so the only way to earn from playing is by beating the computer. Each time you win a battle, you receive tokens called “AlcheCoin” which can be used to purchase in-game items or sold for $ALGO. Currently, you make ~$0.07USD worth of tokens per battle, and each battle takes under a minute. You can read an in-depth summary of Alchemon here.
AlgoSeas: An Idle Pirate game where the goal is to earn currency, survive, and become the Pirate King. You create a crew of up to four pirates with different combat, health, looting and luck stats. You send these pirates out to the sea and they undergo various actions that earn the game’s currency, Doubloons. Doubloons can be used to purchase and upgrade pirates which can be sold on the game’s marketplace for $ALGO. AlgoSeas is a simple yet intricate game that is fun and rewarding to learn. You can read my blogpost about AlgoSeas here.
Cosmic Champs: Though the game is not yet currently live, Cosmic Champs is a real time tower rush game being developed. Similar to Clash Royale, players will battle against each others for the right to earn resources which can be sold or used to strengthen their team. More detail about Cosmic Champs can be found here.
Discord Based Games: Currently, a lot of play to earn games are on discord. I wanted to shoutout some of the ones I enjoy, though I’m certain there are many I’m missing: Grocery Store Game, Arcadian Tales, Land of Allegra, ThurstoberServer, Aegir Tactics, Algo Leagues, Kani World, and Algomond.
Other Algorand Innovations
There are so many incredible projects being built that I could not fit into those major categories. I would like to highlight a couple that demonstrate just how flexible Algorand is, and why anyone who is not paying attention to Algorand right now could find themselves missing out in the future.
Fiction Publishing & Literary Experimentation: Spindle is pioneering experimental fiction on Algorand by increasing author control over their narratives. They are providing a platform where authors can experiment with publication: adding multimedia elements, unique monetization systems, and different ways for audience participation that bypass traditional literary formats and publishing methods. They have a digital zine called Warp & Weft that covers news and fiction stories, which requires an NFT key to access.
FIFA World Cup Sponsorship & Parternship: Algorand just announced a partnership with FIFA to sponsor the World Cup. That in itself is crazy, but whats even more amazing is that there are possibilities for potential integration of Algorand into the FIFA games. It would take in-game card collecting and play to a whole other level.
NFT and Art Marketplaces: Algorand has a booming NFT scene, with marketplaces that make it so easy to buy and sell NFTs. Take a look at Rand Gallery and AlgoxNFT to see what incredible projects are being created.
Environmental Projects: Many projects on Algorand make protecting the Environment the major objective of their work. Projects such as Planet Watch, CryptoTrees, AlgOcean, BirdBot and more are donating thousands and creating renewable ways to protect our planet.
Getting Started on Algorand
If you’re still unconvinced that Algorand is worth diving into, that’s okay. I encourage you to take your time learning about the space and deciding for yourself if it is something you want to be a part of. If any of the projects I mentioned interest you, then feel free to get started with Algorand by creating a wallet and transferring a small amount of Algo over from an exchange such as Coinbase or Binance. If you’re on mobile, you can use Pera Wallet. And if you’re on your computer, then MyAlgo is the way to go.
Link: Buying Algo on Coinbase
Link: Using Pera Wallet
Link: MyAlgo Wallet (Scroll to FAQs at bottom, read “How to create a new Algorand Account in MyAlgo”
A couple key notes for the first time user:
- Never share your seed phase (list of 25 words) with anyone. Anyone who obtains it can immediately deplete your funds.
- Don’t invest in a project without doing your own research. Ask questions on Twitter, Discord, and Reddit and make sure you trust the team behind it. Just like in real life, there are bad actors that are after your funds.
- Always verify the wallet you are sending funds to. Make sure it is correct.
- ASAs are Algorand Assets. They are cryptocurrencies built on Algorand. They have an identification number called the ASA ID that you should always ensure is the correct one. Look for verification tick marks and official projects sources that verify the ID.
Important Algorand Resources & Supporting the Blog
Keeping up with this blog and reading other articles is a great way to learn about the ecosystem. Beyond that, here are some other amazing resources that share Algorand information and News:
Blogs: AlgoGovClub and AlgoGamingGuild (gaming)
Youtubers: The ReCoop, CryptoForChange, FrugalBC, The Crypto Hour, J.T Invests In You
Reddit: Algorand’s official and unofficial subreddit
Twitter: My Twitter, Algorand’s Twitter, The Algorand Foundation’s Twitter
Algorand’s Official Website.
If you’re interesting in Passive Income, read the Best Sources of Passive Income on the Algorand Blockchain.
Thanks for reading, and stay safe!