Algorand is one of the most well-known blockchains in the whole cryptocurrency world. Currently sitting at market capitalisation of around $3 billion, it is also one of the biggest and most used blockchains.

But there is a clear reason why this project stands out. It is its mission, which is to be the greenest and most sustainable cryptocurrency out there. Thanks to this status, Algorand has already partnered with several important and interesting organisations and institutions. But before we dive into that, let’s first very briefly look at what Algorand is and what consensus mechanism it uses.  

What is Algorand?

While many could believe that Algorand is just another decentralized, blockchain-based network, the goal of this project makes it stand-out. At its core, Algorand tries to build around the concepts of ecology, sustainability or self-sustainment. Thanks to this, it is one of the few projects that are actually trying to improve the current state of the cryptocurrencies and their bad wrap, when it comes to emissions or carbon footprint.

Algorand as such is a network that is currently supporting a huge number of applications. With its improved efficiency, leading to better environmental impact, Algorand is one of the pioneering cryptocurrencies when it comes to sustainable blockchains. This has always been the priority of the founder of Algorand, Silvio Micali, who has been very vocal about building environmentally focused projects back in 2018. And in 2019, Algorand had its ICO, with the mainnet going live in June of the same year.

Pure Proof-of-Stake

To help with achieving all the goals that the project has set, it was decided that a new type of consensus protocol should be implemented. Algorand uses Pure Proof-of-Stake (PPoS), which is a bit different from Proof-of-Stake (PoS) consensus mechanism. To put it simply, PPoS is a highly democratised version of PoS, where minimal staking is required to become a validator.

For Ethereum, the level to become a validator was set to be 32 ETH (about $52 000). This is, however, not a small amount that can be achieved by anyone, which means that unless the users want to join a pool, only those who have money can become validators. Algorand has however decided to go in another direction. They set the validator minimum to 1 ALGO (about $0.28), meaning anyone can join the network of validators. Thanks to this the centralization of power is not such a big problem for Algorand.

On the other hand, this means that since the stakers or validators do not need to put huge sums in, they might be inclined to behave inappropriately on the network. And while that might be a bit of an extreme scenario, it does need to be mentioned in the conversation of PPoS especially when comparing it to PoS. With PoS, the stakers usually have higher sums invested in the projects, meaning they would not be rationally inclined to become bad actors within the network.

Sustainability and transactions emissions

However, it is thanks to the Pure Proof-of-Stake, as well as other technical implementations that Algorand has decided to incorporate, that this blockchain can be proclaiming that it is one of the most environmentally friendly blockchains out there.

To prove that this is not only how the projects work on paper, but also how Algorand works in real life, the team behind the project has calculated the amount of CO2 emissions that is released per NFT transaction. Or per any other transaction as such which the network processes, since NFT transactions on Algorand are on-chain and final.

While the whole process of the computation and calculations are rather more complex, the most important conclusion is that Algorand emits around 0.0000004 kg of CO2 per transaction. This is a significantly lower number than Bitcoin or Ethereum. If you want to know the whole methodology of how Algorand got to this result, feel free to follow this link.

Finalised transaction energy over PPoS TPS performance. Source: algorand.com

Algorand ecosystem and partnerships

While this is definitely statistically insignificant, Algorand goes as far as offsetting any of its carbon footprint. Due to this, it has partnered with several eco-friendly and environmentally-friendly initiatives that help this project on its mission to be carbon neutral now, and maybe, also carbon positive in the future.

Ways how Algorand is carbon neutral, Source: algorand.com

Such partnerships include the likes of ClimateTrade, Australia Zoo or IVASS. Moreover, the long list of partnerships and collaborative projects that can be thought of as part of the whole Algorand ecosystem also include the likes of Stoi, NF Domains, Magma, Algogator, AlgoFi or Zone.

Currently it is estimated that the whole ecosystem of Algorand encompasses more than 200 projects and partnerships. Algorand works together with projects from various industries including gaming, oracles, real world, infrastructure, NFTs, DeFi or news and media.

FIFA and the World Cup

With dozens of projects connected to Algorand, one partnership and cooperation probably stands out the most due to its importance. And that is the cooperation with FIFA (The Fédération Internationale de Football Association). FIFA is one of the biggest brands in not only the sports industry, but around the globe.

The partnership between FIFA and Algorand ensured that while Algorand helped with the digital side of World Cup 2022 in Qatar, FIFA will promote this project and make it a flagship of its new initiatives. Algorand will also be the official sponsor of 2023 FIFA Women’s World Cup in Australia and New Zealand.

Examples of collectible cards from FIFA, Source: collect.fifa.com

The cooperation leads not only to supporting main events, but also helps FIFA with digitisation of its content. Thanks to Algorand, fans all around the world can collect their favourite football moments such as goals, assists, saves or celebrations. All of this will be allowed via NFTs through which the fans will be able to own or hold these special moments right in their digital wallets and create their own gallery of collectibles.

This step is crucial not only for Algorand, but also for FIFA, which wants to attract especially younger generations to football. With the rise of the gaming industry and e-sports, football and other sports will have increasingly difficult to catch the attention of the younger generations. NFTs, digital galleries, collectibles or other forms of digital content can help with bringing new, younger audiences back to football.

While Algorand does have other serious partnerships or projects built on top of its network or around its ALGO token, this partnership with FIFA is by far the most important. It not only gives the project a stamp of approval by one of the leading sporting organisations in the world. It also helps to promote the project and ensure its future and stability.

Conclusion

Algorand has been one of the most interesting crypto projects for quite some time. However, it’s recent partnerships and the growth of its ecosystem highlight the potential that this network has. One of the main reasons why more and more companies or platforms are turning their heads on Algorand might be its sustainability mission, which definitely makes it stand out from competition. Unless some other project rises pretty quickly or establishes itself as the “most sustainable” or greenest cryptocurrency, it may be safe to say that Algorand will only gain more partnerships and collaborations thanks to this status.

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