Algorand News Summary of 2022

 Algorand News 2022 so far. Massive Marketing, Nostalgic Partnerships, Descending Price

Algorand News 2022

After a bit of a hiatus AlgoDaddy is finally back with yet another informative Algorand article. A lot of exciting things have happened in the Algorand ecosystem since last, which means that a summary article of the most exciting Algorand News of 2022 is well in it's place. 

I have the pleasure of introducing our first AlgoDaddy guest writer Nathan Cofield, who was extraordinarily kind to help me out and put together this weeks article. You can find his other posts and Twitter page at the end of this article.

Now lets time into it, below are the most important Algorand News of 2022.

Bi-Annual Review & Highlights

The first five months of 2022 have possibly been the biggest newsworthy drops since Algorands inception and launch more than 36 months ago. The Algorand Foundation has moved executive board members in, out and around while inking some far-reaching deals to market the pure Proof of Stake technology around the globe. 

In addition, there have been major acquisitions and partnerships in the music business, who are not the industry giants they once were, but are important to Web3 decentralized content, ownership and earnings. All these exciting announcements have coincided with an unfortunate bear market, where Algorand has reached a low near $0.30 dropping beneath the lowest price of Algorand throughout the 2021 calendar year. Let’s recap the burst of positive news weighed against the plummeting price of the Green Blockchain.

New Management

Since Day 365, the CEO of the Algorand Foundation was Sean Lee, and he managed the new crypto company to focus on ecosystem development during a worldwide pandemic when working with partners all over the globe became much more difficult. Littered with other opportunities, Sean decided to step down to pursue a position at the Crypto Council for Innovation and focus on the company he co-founded in Hong Kong, MODO Tech.

The heir to be the next Algorand CEO, Staci Warden, joined the board of directors as an advisor in September 2021 and gained full control mid February 2022. Staci Warden has an unprecedented resume including leading institutions like the Milken Institute, JP Morgan, the Nasdaq stock exchange and the U.S. Treasury Department. Staci stated at her opening press conference her focus is global financial inclusion, and in 2022, plans to boost global reach and support and scale decentralized finance (DeFi) on mainnet.

Times New Square on Earth Day 2022

Black For Green

In less than 60 days on the job as CEO, Staci Warden warned the Twitterverse that “Supercharged Marketing” for Algorand was beginning soon. The foundation delivered on Earth Day, April 22, with a unique and never-done-before tactic. Algorand de-illuminated much of Times Square in New York City to showcase how environmentally friendly Algo is, while comparing its efficiency to other first-generation, layer-one protocols like Bitcoin. By darkening the display for just one hour, the foundation saved roughly 23 billion joules of energy – equivalent to six Bitcoin transactions or 350 million Algorand transactions. Algorand is paving the way for the world to see that cryptocurrencies do not have to be bad for the planet.

Algorand FIFA news
Exciting times for Algorand as it partners up with FIFA.

Kickin’ it Around The World

Next up is one of the most exciting Algorand News in 2022 - Globally, the International Federation of Association Football (FIFA) is arguably the most prestigious and well-known sports organization, and Algorand inked a deal with the football (aka soccer) monster as a regional sponsor for the Men’s 2022 World Cup this summer and Women’s 2023 World Cup next summer. FIFA president Gianni Infantino and Algorand founder Silvio Micali announced in Los Angeles earlier this month. Dr. Micali claimed the partnership will "transform the way we all experience the world's game.” 

Apart from FIFA managing to grab over one billion viewers during the last World Cup Final, the pact also gives Algorand exclusive access to host future FIFA assets on the blockchain. This could include NFTs of players, tickets to the matches and possibly even a crypto video game. FIFA currently is locked in with EA Sports to produce its hit game titled FIFA, but the contract expires after the release of FIFA23 next year. Matt Zhang, former Citi executive, and owner and CEO of HiveMind Tweeted out some alpha information after the press release.

LimeWire & Napster

I remember as a young teen using LimeWire to torrent songs for free to download on my computer, along with a host of trojans and viruses, to put onto my iPod Shuffle. Napster was a little before my time, and the first time I remember hearing about it was watching the 2010 movie, The Social Network, which featured Justin Timberlake portraying Sean Parker, the founder of Napster and first president of Facebook. Napster originally was a peer-to-peer (p2p) file sharing site that focused on sharing music. The decentralized file sharing network was one of the first of its kind, with over 80 million users at its peak. Because of copyright infringement lawsuits, it was converted to traditional music sales and has been purchased and sold by different companies over the course of the last two decades. 

Napster has now been acquired by the aforementioned investment firm Hivemind and Algorand at an undisclosed price. Hivemind also backed LimeWire, another p2p mp3 file share company who wants to shift focus toward NFTs. Matt Zhang told reporters he wants to merge decentralized platforms from Web1 and Web2 with Web3 that Algorand is creating.

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Bear Down - Algorand News 2022

Premier partnerships deals, along with headline worthy advertising, and yet the price of Algorand has plummeted as the $LUNA and $BTC candles went parabolically down (more on this below). Bullish news and deals will not always equate to positive market value. This was to be expected of Algorand. The circulating supply of ALGO on January 1, 2021, was 1,192,361,096.7, today that number is 6,809,460,347.71. In other words, in the last 18 months, Algorand has experienced over a 471% increase in supply. In this time, accelerated vesting took place and ended, as well as rewards for holding ALGO. Tens of millions of ALGO have been given away in grants to crypto companies building on the ledger, and these companies must sell these ALGOs in order to have the capital needed to continue to #BUIDL. In basic economics, we also learn that when supply dramatically increases, demand will subsequently decrease, on average. 

The real kicker comes down to two factors – Bitcoin and TVL. The crypto market is still heavily influenced by Bitcoin’s price at any given moment. Bitcoin accounts for roughly 50% of all cryptocurrency market cap, it would be like if 50% of the money in the stock market was Amazon. When one falls, everyone falls, at least for right now, until some alt-coins like ALGO can create a genuine separation. The other factor is Total Value Locked, or TVL, which is calculated by multiplying the amount of funds that are locked as collateral in the ecosystem by the current price of the assets. According to DeFi Llama, Algorand currently has a TVL of about $120 million, this puts it outside the top 100 cryptos’ TVL. In order for Algorand to have a serious presence, the TVL needs to surpass $1 billion, which would only rank 21st today.

Luna Terra Algo
The Luna/TetherUS fiasco resulted in a complete wipeout in value

LUNA/Terra Debacle

TerraUSD or UST is an algorithmic (NOT related to Algorand) stablecoin, which uses a complex mix of code and LUNA to stabilize the price instead of having cash and other assets held in a reserve to back its token, the way a bank does. On May 12, UST crashed almost completely, and lost its $1 peg to the dollar, tanking to a low of $0.26. Last month Terra’s market cap ranked them a Top 10 coin at a price of $120, and LUNA, the sister coin of UST, crashed over 97% to basically $0.00. LUNA helped keep UST pegged to the dollar through a series of mint and burn mechanics to, in theory, ensure $1 of UST could mint $1 of LUNA. The other catalyst for the crash was the anchor protocol. Anchor offered an unsustainable 20% return for staking UST, which accounted for $14 billion of the $18 billion UST circulating. 

 Then last week, over $11 billion of the UST were taken off Anchor and put into the open market to sell. This led to sharp drops in price for UST and LUNA, until eventually $1 of Luna was not worth $1 of UST, and fearful holders worried the entire ecosystem could become insolvent. Terra’s creator, Do Kwon, purchased $3.5 billion worth of Bitcoin to support UST in the event of a crisis like this. Kwon sold off the majority of this BTC reserve to try and salvage the situation, but ultimately crashed Bitcoin and the entirety of the cryptomarket. Algorand does have stablecoins, such as Algofi’s $STBL which is also pegged to the dollar. Although different because there is no sister coin, STBL is collateralized using Algorand tokens. Although I do not believe STBL is perfected yet, it is a much safer choice than UST.

Final Words 

Our favorite crypto is going through an incredibly important growth stage right now. The increase on mainnet launches have skyrocketed the last 18 months with many more coming down the pipe. The application explosion has happened mostly in the last eight months, where Algorand went from zero decentralized exchanges (DEX) to more than five currently and will have more than 10 DEXs by the end of 2022. NFT artwork and usable tokens like Lofty.Ai also boomed. Then just in 2022, Algorand doubled down on its marketing through large showings at Times Square and deals with FIFA, LimeWire and Napster. 

The Green Blockchain is headed in the right direction – Ecosystem development and advertising. The entire cryptocurrency scene is ridiculously young and immature with very little governmental regulation. 

Time is all that is needed. Do your own research and #HODL on my fellow Algonauts.

About the Author: Nathan Cofield, creator of Personal Connection History, writer, educator and crypto enthusiast lives in Dallas, Tx with fiancĂ© Brooklyn. Find him on Twitter

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