Algorand and the blockchain trilemma - Crypto Academy / S5W4 - Homework post for nane15
Today in this post I will share with you my Homework Task (Season 5/Week-4) for Professor @nane15. The course that the professor @nane15 has discussed with us "Algorand and the blockchain trilemma". I have learned a lot about The Algorand and the blockchain trilemma from this lecture of the professor.
Question-01:
What is Algorand blockchain?
Algorand is a recent third-generation blockchain project, founded in 2017 by Silvio Micali. Its initial release was in April 2019 and its main network was launched in June 2019. This is a blockchain of extreme decentralization. The Algorand blockchain consensus mechanism is based on the Pure Proof of Stake (PpoS) consensus. One of the main goals of this Algorand blockchain network was to solve the blockchain trilema problem. It has its own currency, its own currency is called Algo.
We know that blockchain trillema is a very big problem in blockchain networks. Many blockchain networks have this blockchain trilomema problem. Blockchain trilogy consists of three main issues: decentralized, secure, and scalable. If any two are solved in the blockchain network, then one problem remains. Solving the problem of blockchain trilema is a very challenging issue. And Algorand blockchain technology is working on solving three problems of blockchain trilomera, this is their main goal.
We already know that it is almost impossible to solve the problem of blockchain trillima. Because it is impossible for a decentralized network to ever build a very fast, secure network. It was just an idea of man. Because now Algorand blockchain has answered this question through their work. They have built their network in such a way that it allows decentralization as well as very fast and secure transactions. This means that we can say that Algorand blockchain technology has come up with blockchain trilema solutions.
The Algorand blockchain has taken this issue very seriously so that it can produce blocks very quickly for a consensus protocol on their network. The Algorand blockchain network is capable of handling at least two thousand transactions per second. In that case we understand that Algorand blockchain technology is very scalable. Which is one of the problems of blockchain trilema. It has solved Algorand blockchain very efficiently.
The issue of security is very important for any issue. Because in any blockchain or any other subject, a user is more attracted to that blockchain when its security is at a very high level. And on the Algorand blockchain network, security is very important. The Algorand blockchain is one of the most secure networks. This is one of the problems with blockchain trilema. The Algorand blockchain has been able to solve this problem efficiently.
And we already know that the Algorand blockchain is a complete decentralization. This allows each user on the network to process the next block transaction, who owns Algo. As long as the currency owner is online, the owner of the currency can influence the processing of the transaction. In that case, we understand that there are three solutions to the Trilema problem in this Algorand blockchain technology.
Question-02:
What is PPoS?
The full meaning of PPoS is pure proof-of-stake. This PPoS protocol system allows each user who owns the currency of the Algorand blockchain's Algo Token to decide on the choice of the new block. The user's influence in this system is proportional to his participation. In other words, the number of token shares he owns has the same effect. All users online here are randomly and secretly selected to block proposals and vote. Users who are online have the opportunity to be selected and offered to vote. Another point here is that the more tokens one has, the more likely one is to qualify.
According to the PPOS system, this system is more secure when most of the money is honest, that is, the PPOS system basically combines the security of the economy with the integrity of most economies. It is never possible for those who own small fractions to damage the system, they can never damage the system if they want to. Those who own most of the money in this system, if they misuse money or do something bad, their purchasing power of money will decrease and their value will decrease a lot. Instead, they will do their own harm.
Question-03:
Explain the advantages and disadvantages of PPoS.
Each thing has its advantages and disadvantages. While the PPoS protocol system has many advantages, it may have some disadvantages. We will briefly discuss below some of the advantages and disadvantages of PPoS protocol system.
Advantages of PPoS:
- It has a very high security system, so it is very difficult to attack because there is no specific group of verifiers.
- It has a lot of high scalability. It can currently process 2000 blocks per second. It can process a lot of blocks very quickly and in a short time.
- Here users can spend their asset at any time they want.
- It is complete decentralization. Here each user is randomly and secretly selected who participates.
- The three problems of blockchain trilemma have been solved very successfully.
Disadvantages of PPoS:
- It has not yet become so popular, To many it has not yet been adopted. I also didn't think there was any disadvantage of PPOS.
Question-04:
Do you think Algorand really solved the blockchain trilemma? Explain your answer.
In the case of blockchain blockchain trilemma this problem is now a thing of the past. At one time it was thought that it was almost impossible to solve all three problems of this blockchain trilemma of blockchain together. If one goes to solve two of these three problems of blockchain, the other one has to be sacrificed. If someone wants to be decentralized in the case of blockchain and keep it very safe then the other one has to be sacrificed.
But now Algorand blockchain has successfully solved these three problems of blockchain or blockchain trilemma problem. Because of the three issues that blockchain trilemma has discussed above, the three issues that Algorand blockchain technology has provided to users are: It is a highly decentralized network and transactions are completed very quickly and the security of Algorand blockchain technology is much higher. In that case I think the problem of blockchain trilemma has been solved successfully and Algorand blockchain has been able to solve this.
Question-05:
Do you think PPoS is better than PoW? Explain your answer.
I can personally answer this question by saying that PPoS is much better than PoW. Below I can explain some of the reasons why PPoS are better than PoW.
The first reason I want to explain is that it takes 10 minutes to verify a block for those who do block mining on the PoW network. Which is much higher than the PPoS network. Because of course we know that on the PPoS network, blogs are voted every second. In that case it is a time difference between PPoS and PoW in a block verification.
Another thing we will know is that in the case of PoW, block mining is done by solving various mathematical problems in cryptographic method. To do this mining they compete miners, the person who succeeds first has the opportunity to block the next block for him. They require a lot of high power and high power computer power. It is very expensive and those who can invest here well or in large quantities get the opportunity to mine in case of PoW. They have to spend a lot to setup. But in the case of PPoS, none of these things are required. Once a user owns Algo and is online, he or she can propose and vote for new blocks. In that case PPoS is much easier than PoW
Also PoW cannot be called a completely secure system by name. Because there is a 51% chance of an attack. If 51% of the miners want to attack together then there is a possibility of attack. They can manipulate the blocks. But there is no such possibility in PPoS.
in Pow you can solve two minor puzzles together, whoever can solve first gets the chance to mine the next block. But PPoS is not such a thing.
Question-06:
Do you think PPoS is better than PoS? Explain your answer.
Do you think that PPoS is better than PoW? In answer to this question I can say that yes I think PPoS is much better than PoW. Some of the reasons why I said this I will explain in brief below.
Of the three problems that blockchain trilemma has, POS has not been completely successful in solving these three problems. While they are successful in two of the three trilemma, they have to compromise in the other one. But if we look at PPoS, we can see that the PPoS protocol has solved three problems of blockchain trilemma.
Also in the case of PoS we see that to participate in the right to process the next block, the token has to be blocked. So the user has to block the token in the network to participate. And you have the right to block as many tokens as you can. Here you have to wait until the pre-determined time, but many are not willing to do it. In that case it is very difficult to participate in this system. Many users do not like this system and it cannot be called complete decentralization. But this is not the case with PPoS, where decentralization is addressed
Question-07:
Explore and explain an ALGO transaction using algoexplorer.io.
Today I will use the algoexplorer.io platform to explore ALGO transactions. So first I go to this website algoexplorer.io.
Step-01: First we will come to the homepage of this algoexplorer.io platform. When the homepage comes, we will see such an interface. The latest transaction will show on the right side of the homepage to view the transaction from here. If I click on the View All Transaction link above, I can see all the transactions here.
Step-02: Then such a page will come in front of us. All transactions can be seen here. We can click on a single transaction to view it.
Step-03: When we click on a single transaction, we will see in front of that transaction: transaction ID, timestamp, block, sender, amount, receiver.
Question-08:
Perform an analysis of the price of ALGO from the beginning of the year to the present. Via graphics
Carry out an analysis of the price of ALGO from the beginning of the year to the present. That's why I will go to this algoexplorer.io platform first and from here I will click on 1 year to see the one year price.
In the screenshot above we can see the price chart of the last one year from the current time backwards
In the screenshot above we can see the last one year Tradable Market cap from the current time backwards.
Question-09:
Conclusion
Finally I can say that Algorand blockchain has successfully solved the problem of blockchain trilemma. At the same time, they have been able to decentralize blockchain, speed up transactions, and improve security. Although the problem of blockchain trilemma has been seen in many difficult ways before, now Algorand blockchain has been able to solve this problem. Through today's lecture I have learned many important things that I did not know and by completing this course I have learned many new things. So I am very grateful to my dear professor @nane15 for giving us such a beautiful well explained lecture.