The Algorand Blockchain
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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.
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The Algorand Blockchain
- 1. your@email.com Your Name and Title The Algorand Blockchain
- 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
- 4. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level Tamperproof Transparency Trust The Blockchain Promise Unlimited Applications
- 5. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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 6
- 6. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level Today’s Centralized Economies Are Broken 7 *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
- 9. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level Borderless… Commerce Transactions Exchange Opportunity Applications Development Finance Currency EconomyMoney Governance Investment Participation Trade Markets Customers Technology Innovation Contracts
- 10. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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
- 11. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level We have stats on MainNet! • We have been running since June 19 and have processed blocks under 5 seconds. 12
- 12. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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. 13
- 13. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level Open vs Closed 14 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
- 14. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level The Blockchain Trilemma “At most two of…” Security Scalability Decentralization
- 15. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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. 16
- 16. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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.” 17
- 17. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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 18
- 18. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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. 19
- 19. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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. 20
- 20. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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. 21
- 21. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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 22 Alogorand’s CORE Technology (in a nutshell) https://medium.com/algorand/algorands-core-technology-in-a-nutshell-e2b824e03c77
- 22. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level ’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. 23
- 23. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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
- 25. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level Algorand Consensus Overview
- 26. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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
- 27. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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)
- 28. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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
- 29. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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
- 31. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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
- 32. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level Algorand Foundation Rewards § See Foundation site § https://algorand.foundation/token-dynamics § All users online and offline are eligible to earn rewards
- 33. Algorand TestNet
- 34. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level TestNet Rocks!
- 35. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level TestNet Node Map
- 36. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level TestNet AlgoExplorer 38
- 37. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level See transactions 39
- 38. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level Transaction details 40
- 39. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level Install your node! Install new node • Log into https://developer.algorand.org/ • https://developer.algorand.org/docs/introduction-installing-node 41
- 41. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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
- 42. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level Private Network Private Networks are primarily for developers to learn from locally.
- 43. SDKs
- 44. SDKs and Swagger
- 45. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level Swagger.Json
- 46. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level SDK Functionality 58 kmd Wrapper algod Wrapper Stand-alone functions Create accounts Account Mnemonic Create Transaction kmd algod Sign Transaction Air Gapped Applications Networked Applications
- 47. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level SDK Documentation at Developer.Algorand.org 59
- 49. Coming Features
- 50. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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
- 51. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level 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 63 è Visit community.algorand.org
- 52. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level Summary • Algorand Has Launched! • https://twitter.com/Algorand/status/1141368150467993601 64 § What is Algorand? § Algorand’s Consensus Model § Algorand Foundation § TestNet § SDKs Command Line tools § Planned Developer Features
- 53. • Click to edit Master text styles • Second level • Third level • Fourth level • Fifth level Sign up Today! 65
- 54. Questions?