Aug 26, 2019
By: Silvio Micali
In the two months since the Algorand network launched, the Algorand ecosystem has seen impressive growth. Our developer community continues to expand across the globe, with participation in thousands of forums and presence at dozens of conferences and hackathons. Platform adoption is increasing rapidly as major enterprises begin building on the platform to realize its unprecedented levels of performance.
Consequently, applications of the Algo token are expanding as well. In this article, our founder Silvio Micali shares what’s next from a protocol perspective to enable these powerful, diverse new use cases, tokens, and assets. Read about Algorand’s strategy for layer-1 implementation of fungible tokens and atomic multi-party transfers.
It’s been exciting to see the different ways people are using Algorand since the Algorand Foundation launched a public mainnet on June 19th, and so many ideas and contributions to the open source platform.
Thanks to the unique security, scalability, and decentralization of the Algorand protocol, a block is produced in less than 5 seconds, and all transactions are immediately final. These fundamental properties have led many in the community to experiment with the technology in different ways.
One of the common use cases we have seen is using the protocol to create new tokens and assets, including a diverse array of tokenized assets such as derivatives, options, swaps, securities, and more. The recent announcement of Algorand joining ISDA was based on the idea of allowing for flexible templates and asset creation across a large library of known asset types.
On other chains, the creation of these new assets requires either smart contracts or other Layer-2 approaches. This has led to a host of innovations, but also carries security, efficiency, and scalability issues. In addition, we have observed many use cases where smart contracts are too complicated for the task at hand.
At Algorand Inc, we are committed to being an ongoing contributor to the open source community and are proposing two new features that eliminate the drawbacks of these Layer-2 approaches.
These new features, both implemented in Layer 1, are:
By being implemented in Layer 1 of the blockchain, both features become part of the Algorand consensus protocol and are made very secure, efficient, and easy-to-use.