Algorand is a new blockchain built on a Permissionless, pure proof of stake, decentralized agreement protocol, where anyone can participate and requires minimal computational power. This protocol finalizes transactions very quickly and offers true decentralization.
This session covers the basics of how the Algorand protocol works, cover the architecture overview, managing the node with the command line tools, and an overview of how developers can integrate using the SDKs to build Layer 2 applications.
2. The documents and statements presented on (or directly accessible from)
this presentation may contain forward-looking statements. These statements
relate to future events or Algorand Network's future performance, financial
or otherwise. Any statements that are not statements of historical fact
(including without limitation statements to the effect that the Company or
its management “believes”, “expects”, “anticipates”, “plans” (and similar
expressions) should be considered forward looking statements. There are a
number of important factors that could cause Algorand Network’s actual
results and outcomes to differ materially from those indicated by the
forward looking statements. The Algorand or any other party contained
within disclaim any obligation to update any forward looking statement.
Safe Harbor
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Tamperproof Transparency Trust
The Blockchain Promise
Unlimited Applications
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Ransomware Attacks!!!
• City of Baltimore and over 25 other cities!
• $100,000
• What is worse then Ransomware Attack?
• Ransomware Paid! by Palm Beach, FL
• $600,000
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Today’s Centralized Economies Are Broken
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*Sources: McKinsey, Fundstrat, Bloomberg, PwC
7. Agenda
§ What is Algorand?
§ Algorand’s Consensus Model
§ Algorand Foundation
§ TestNet
§ SDKs and Command Line tools
§ Planned Developer Features
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Borderless…
Commerce
Transactions
Exchange
Opportunity
Applications
Development
Finance
Currency
EconomyMoney
Governance
Investment
Participation
Trade
Markets
Customers
Technology
Innovation
Contracts
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Algorand
§ Pure Proof of Stake (PPOS) Blockchain
§ Permissionless
§ Fast Transaction Throughput and Finality
§ No Forking – only one Block can get Quorum
§ Upgrades on Chain
§ Scale to billions of users
Consensus Keynote by Silvio Micali, Founder of Algorand
“Building the Technical Innovation Required for a New Borderless Economy“
(#40 in the Construct section)
https://www.coindesk.com/events/consensus-2019/videos
Algorand YouTube Channel
https://www.youtube.com/algorand
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We have stats on MainNet!
• We have been running since June 19 and
have processed blocks under 5 seconds.
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Permissioned vs Permissionless
Public vs Private
Public Blockchain
Permissionless
Private Blockchain
Permissioned
Anyone can join the Blockchain
network, this means they can
read, write, or participate with a
public blockchain.
Public blockchains are
decentralized and no one has
control over the network and they
are secure in that the data cannot
be changed once validated on the
blockchain.
Permissioned networks place
restrictions on who is allowed to
participate in the network and in
what transactions.
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Open vs Closed
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Public & Closed Public & Open
• Voting
• Voting records
• Whistleblower
• Currencies
• Betting
• Video Games
Private & Closed Private & Open
• Construction
• National Defense
• Law Enforcement
• Military
• Tax Returns
• Supply Chain
• Government financial records
• Corporate earning statements
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The Blockchain Trilemma
“At most two of…”
Security
Scalability
Decentralization
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So that is the “What”, now for the “How”?
• All blocks have one way hashes tying the blocks
together
• All blockchains share this approach, including
Algorand’s.
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Generating New Blocks
• Various approaches for choosing the next block:
• Proof-of-work
• Delegated proof of stake
• Bonded proof of stake
• All these approaches have a fatal flaw
• “The whole economy is at the mercy of a small part of
the economy.”
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How do you select a new block to be appended to the chain?
proof-of-work
• Miners own only a small fraction of the money in a proof-of-
work blockchain
• There are only a few mining pools
• The chain is not secure.
• An adversary may thus attack either the protocol or
communication network
• Forks can cause scalability issues
• Not Green
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How do you select a new block to be appended to the chain?
(continued)
Delegated proof-of-stake
• The community empowers a few special delegates, to choose
the next block
• It is centralized from the get-go.
• Since the delegates are known, a determined adversary could
bring down all the delegates by a fast DoS attack.
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How do you select a new block to be appended to the chain?
(Continued)
Bonded Proof-of-Stake
• Bonded PoS allows 20 users, or as many as are willing, to put
some money on the table — a bond.
• These are the users who select the next block.
• If they misbehave, their money is confiscated.
• makes it easy for big thieves to put a disproportionate amount
of money on the table for the sole purpose of controlling the
blockchain.
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Algorand’s Logic and Pure Proof-of-Stake
• No money is ever hostage.
• All money is always where it should be: in your wallet, at your fingertips ready
to be spent, or in the various financial instruments that the Algorand
blockchain offers you.
• We want block generation to be simultaneously scalable, secure, and
decentralized.
Phase 1
• A single token is randomly selected, and its owner is the user who proposes
the next block.
Phase 2
• A number tokens are selected among all tokens currently in the system. The
owners of these tokens are selected to be part of a phase-2 ‘committee,’ which
approves the block proposed by the first user.
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Defeating the Trilemma
§ Security –
§ Committee members are not known until after the fact
§ Everything is cryptographically signed
§ Scalability
§ Minimal messages
§ Lottery execution extremely fast
§ Decentralization
§ Low barrier to entry
§ Anyone can participate in consensus
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Alogorand’s CORE Technology (in a nutshell)
https://medium.com/algorand/algorands-core-technology-in-a-nutshell-e2b824e03c77
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’s Technical Advancements
• A new and super fast Byzantine agreement – Allows system to agree on a new block
while that block propagates
• VRFs (Verifiable Random Function) is open sourced and Cryptographic Self-Selection
to Blockchains. Allow users to secretly, fairly and provable select themselves
• Player Replaceability – Withstands the corruption of all users in the middle of a
protocol.
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Verifiable Random Function (VRF)
A Verifiable Random Function (VRF) is a cryptographic primitive that
maps inputs to verifiable pseudorandom outputs. VRFs were
Introduced by Micali (founder of Algorand), Rabin, and Vadhan in ’99
• Open Sourced
• Used in block proposal and committee
selection
• Cryptographic Lottery
• Self Selected and Verifiable
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Algorand Consensus Overview
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Algorand Consensus Block Proposal
❖ Nodes run lottery for accounts they
manage
❖ At most one winner’s proposal for the
node is propagated to the Algorand
network
❖ Other nodes do the same
❖ Very few winners
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Algorand Consensus Soft Vote
❖ Cull to one proposal
❖ Each winner is examined and one is
selected and propagated
❖ Results in one proposal (After step time)
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Algorand Soft Vote Continued
❖ Committee selected to vote on the proposal
using VRF lottery
❖ Weighted votes on winning tokens
❖ Prevents multiple account advantage
❖ Committee votes on its best proposal
❖ Quorum moves to Certify step
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Algorand Consensus Certify Vote
§ Intent is to certify block
§ New committee is chosen to certify the
block using VRF
§ Committee votes on the Proposal that
came out of Soft Vote
§ Quorum reached, block is certified and
written to the Blockchain
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Algorand Foundation Dutch Auctions
• https://algorand.foundation/
• Foundation has launched Auctions
• Tokens bids stored on chain
• Auction winners are recorded on chain
• Auction parameters posted to chain prior to Auction
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Algorand Foundation Rewards
§ See Foundation site
§ https://algorand.foundation/token-dynamics
§ All users online and offline are eligible to earn rewards
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TestNet Rocks!
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TestNet Node Map
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TestNet AlgoExplorer
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See transactions
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Transaction details
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Install your node!
Install new node
• Log into https://developer.algorand.org/
• https://developer.algorand.org/docs/introduction-installing-node
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Goal
goal
clerk
account
addpartkey
balance
changeonlinestatus
importrootkey
list
new
multisig
rename
send
multisig
rawsend
ledger
supply
logging
disable
enable
send
network create
delete
restart
start
status
stop
node
clone
generatetoken
lastround
restart
start
status
stop
version
Wallet
KMD
list
new
start
stop
delete
listpartkeys
rewards
pendingtxns
export
import
partkeyinfo
renewallpartkeys
renewpartkey
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Private Network
Private Networks are primarily for developers to learn from locally.
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Near Term Projects
§ Vault - Solve blockchain storage issues
§ Pixel – Address size and bandwidth of multi-signature requirements
§ Self Validating Transactions – Address balance time constraint
§ Atomic Swaps – Crosschain and multi-asset swaps in single transactions
§ Post-and-Sale Trades – Get buyers and sellers together quickly
Further out
Smart² contracts, quantum-resiliency
Source: https://algorand.foundation/roadmap
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Become An Algorand Ambassador
• Work directly with the Algorand team and
learn from the best in the field
• Host your own hackathon or developer
meetup to help others in your community
build on top of Algorand
• Connect with other developers from all over
the world who are also building on Algorand
• Get the latest news and updates about our
platform before anyone else hears about it
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è Visit community.algorand.org
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Summary
• Algorand Has Launched!
• https://twitter.com/Algorand/status/1141368150467993601
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§ What is Algorand?
§ Algorand’s Consensus Model
§ Algorand Foundation
§ TestNet
§ SDKs Command Line tools
§ Planned Developer Features
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Sign up Today!
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