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Taking place in Dubai, the newly adopted “crypto-friendly” hub of the industry, we discuss Algorand’s technology and achievements, its plans in the middle east, the state of the market after recent events, and Algorand’s place in all of this.
Pleasant-natured yet direct, Sean doesn’t mince his words. In his earlier keynote speech, he addressed the elephant in the room. Despite the apparent excitement and many developments from the Algorand community, no blockchain ecosystem exists in a vacuum. After a annus horribilis for the crypto industry with the collapse of Terra/LUNA, Three Arrows Capital, FTX, and many others, he recognized that everyone “needs a little therapy” — and talked about how to move forward as an industry as a whole.
“Keeping our promises,” he said, is one of the main ways web3 can regain credibility. He affirmed that Algorand, unlike many other projects, has always made this a priority – striving to deliver technology without unnecessary hype and speculation. Since its launch in 2019, Algorand has created a scalable platform that provides security, rapid finality, and (as Sean emphatically emphasizes), “zero downtime.”
Running on a variation of Proof of Stake (PoS), Algorand’s Pure Proof of Stake (PPoS) prioritizes fairness and decentralization, choosing validators anonymously at random. This ensures that all network participants receive an equal opportunity regardless of their stake and that no group of validators becomes disproportionately powerful.
Transactions take less than four seconds to complete, and unlike other layers, Algorand emphasizes accessibility. As a result, developers can build on Algorand in many existing programming languages from Java and C++ to Go, Python, and Rust — without having to learn a separate codebase.
Why doesn’t Algorand’s name pop up more often in the circles of crazy VCs or avid influencers? Because its team has always avoided overpromising and underdelivering. The time for vaporware projects and reckless behavior is behind us (according to Sean).
“Now is the time to move forward,” he said: “Our time is now.”
Algorand’s Extraordinary Partnerships
The background music starts playing a little too loudly for meaningful conversation, but Sean remains unfazed; he approaches the recorder as I ask him to explain some of the promises Algorand has kept. Self-described as “the world’s most powerful and sustainable blockchain,” Algorand has landed some big fish this year, including partnerships with international football association FIFA and popular music-sharing platform Napster.
Sean explained that Algorand only pursues a partnership if a “technical component is tied to it” and that the FIFA agreement is about “helping to innovate and develop new opportunities for its fans and followers of the sport. “
As its official blockchain partner, Algorand has thus far developed a marketplace for collectibles tied to FIFA’s digital archives, but Sean explained:
“There are many ways the partnership can evolve,” from issuing bonds to making composable tickets that “take on a life of their own.”
As FIFA begins its journey to embrace greater openness and transparency, Sean believes the partnership will:
“The first step in its transformation journey to start embracing new technology and drive benefits to engage more closely with fans.”
When it comes to Napster, which Sean refers to as a “leader of the era,” thanks to Algorand’s technology, the company can finally deliver on its mission to democratize music — while rewarding its creators. Napster is one of several Algorand projects that revolve around the creator economy, allowing artists to tokenize and fractionalize their music and trade the value of music technology. Sean was delighted:
“Platforms like Napster bring money back to famous artists and independents who are trying to make money, not only in western countries but all over the world.”
Advances in Institutional Relations
Beyond numerous initiatives for retail customers, Algorand has left a footprint in traditional institutional circles. Surprisingly (and in stark contrast to many web3 projects), Algorand differentiates between “blockchain” and “crypto.” “Those are two different things,” Sean said. Talk to anyone at Algorand, and you’ll rarely hear talk of the native ALGO token or its position on the cap table. Instead, the emphasis is on the underlying platform and building blockchain applications that have the potential to impact society and change the world at large.
Given the current market turmoil, we asked Sean if Algorand has witnessed any pullback from institutional investors. He shook his head and reflected:
“Traditional financial institutions have become more thoughtful and strict about understanding technology and its benefits and pressure-testing the capabilities of technical partners. They are stricter because they have fiduciary responsibility and there are things they cannot accept such as downtime, lack of security, or lack of finality.”
While many of these institutions “aren’t moving as fast as we’d like,” Sean believes their presence in the industry is inevitable. He gave the example of behemoths like Fidelity recently announcing a move to digital asset custody:
“I don’t see a big pullback when you consider the use of new infrastructure — at least in our world. Our partners around the world, like Koibanx in Latin America, are working with dozens of financial institutions and banks to use the blockchain and Algorand and use it for their infrastructure. They are very active even in this climate.”
Plans in the MENA Region
Algorand has established a notable presence in Latin America and Europe (Italy, where its Turing Award-winning founder, Silvio Micali hails from). Now, the team is setting its sights on the upcoming MENA region. Already active in Nigeria, where the government is building a nationwide intellectual property wallet using its technology, Algorand is looking to gain a foothold in the middle east, holding Decipher in the most populous destination of the United Arab Emirates.
“We chose this region [for Decipher] because we saw a good opportunity, we knew that this region was disciplined and focused on project quality and we felt a good merger between what we brought to the table and the UAE’s ambition for Dubai to be the first global city powered by blockchain technology .”
Algorand saw the potential in this part of the world early. So in 2019, the team collaborated with the UAE authorities to receive Sharia compliance as a blockchain. He explains:
“We were one of the first chains to receive [Sharia compliance].”
He said Decipher is “a great launchpad to build foundations in this region and rekindle relationships and conversations more formally as we move into the new year.”
What’s Next for Algorand?
Sean previously described Algorand as “pragmatically optimistic.” However, when we ask if he’s concerned about the effects of emissions regulation on FTX/Alameda, he chooses his words carefully:
“Worried is not the word I would use. I hope there is a smart approach to providing assurance and safety for people using blockchain.”
He said there is a tendency to “lump all things into one bucket” despite the seismic differences between various industry players. “Most of all,” he said:
“My hope is that innovation is still encouraged in the blockchain space and that appropriate levels of assurance are put in place around the exchange of value.”
What else is to come for Algorand as we head into the new year? Sean paused, “There are a few things I’m most excited about,” he said:
“First of all, I look forward to ending tribalism in the industry. I never liked that. There needs to be more collaboration, a ‘wins are shared’ approach and a greater desire to create simple, interoperable tools so people aren’t forced to choose one tribe over another.”
In the Algorand ecosystem, these tools are known as “Algorand state proofs,” which Sean describes as “genuinely transformative tech” and “the first step in a truly decentralized trustless bridge that will allow assets in any chain exchangeable and interoperable in assets. to any other chain without having to use centralized points of failure. That’s pretty revolutionary. I’m excited about interoperability and proofs of state in Algorand in particular.”
A gondola traverses the meandering creek below, and is old-world-themed souk behind forms a stunning contrast against the backdrop of one of the world’s brightest and most iconic buildings, the Burj Al Arab, rising from the sea like a giant sail. Sean shakes my hand and thanks us for our time, and we wish Algorand all the best for 2023 as interoperability solutions in the crypto — sorry, “blockchain” — space are passionately open.
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