One of the many blockchains that claim to be an “Ethereum Killer,” Algorand has had a tough time of late. Unable to meet the heights it hit when it was launched four years ago, the chain and its native coin, ALGO, have been perilously close to its pandemic-induced low, set in March 2020.
Things went from bad to worse in April 2023 when the United States Securities and Exchange Commission suggested that it was an unregistered security when it filed a lawsuit against the Bitfinex crypto exchange. When the SEC targeted the Binance and Coinbase exchanges in early June, the coin’s holders panicked and the price went down to a new all-time low.
Although there was some recovery after that, July’s news that the Algofi decentralized finance (DeFi) protocol was to close struck another blow to the ALGO price.
But what is Algorand (ALGO)? How does Algorand work? Let’s see what we can find out and also look at some of the Algorand price predictions made as of 25 July 2023.
In early July, the Algofi DeFi protocol announced that it was to wind down its operations. In a statement , it said: “A confluence of events has taken place that no longer makes building and maintaining the Algofi platform to the highest standards a viable path for our company. Due to this, we will begin sunsetting the platform and put the platform in withdrawal-only mode shortly.”
The protocol said that it was aiming to wind everything down by the middle of January 2024.
The decline of Algorand over recent months can be demonstrated by the Total Value Locked (TVL ), the amount of money staked on the platform, dropping from a little over $200 million in late February to $46.95 million on 25 July.
There are three things that, ideally, every blockchain should be. A perfect blockchain should be scalable, so it is able to maintain its performance as it gets larger and more people use it, decentralized, so it is not under the control of one authority, and it should be secure. Often, blockchains are able to be two of those things, but not all three. This is known as the blockchain trilemma, and solving it is a major goal for computer scientists.
The Algorand blockchain aims to solve the trilemma. It was founded by Silvio Micali, a Turing Award winner and computer science lecturer at the Massachusetts Institute of Technology and launched in 2019. It promises speeds of up to 1,200 transactions per second. The system offers decentralized finance (DeFi) solutions, and people can mint their own non-fungible tokens (NFTs), the rights to links to individual pieces of digital art on it.
Algorand is powered by its eponymous coin, also known by the ticker handle ALGO.
Algorand uses something called Pure Proof of Stake (PPoS) to add blocks to the blockchain and mint coins. People are chosen randomly but with a weight given to those who hold more ALGO, to add blocks to the network. Then, a vote takes place, a winner is chosen, and a randomly selected committee of users approve the block.
The blockchain is based on two layers. The first one supports simple smart contracts, computer programs that automatically execute once certain conditions are met, and NFTs, and crypto tokens. The other one supports more complex smart contracts and decentralized application (DApp) creation.
In terms of ALGO itself, the coin helps secure the network and pays for transactions. It can also be bought, sold, or traded on exchanges.
Let’s now examine some of the Algorand price history . While past performance should never be taken as an indicator of future results, knowing what the coin has done in the past can give us some useful context when it comes to either making or interpreting an Algorand price prediction.
ALGO first came onto the open market in the summer of 2019 and it soon shot up, peaking at $3.28 on 21 June that year. The market has, ever since then, pretty much decided it was overvalued, because that price still serves as an all-time high. It sank down, reaching an all-time low of $0.1024 on 13 March 2020 as markets across the board suffered as the Covid-19 pandemic spread across the globe.
In 2021, things picked up and ALGO was one of many cryptos to blossom, with the price trading above the dollar between February and May. While the coin then suffered during the summer, it picked up again later on in the year, hitting $2.54 on 13 September and then gently dropping to close the year at $1.66.
In 2022, the markets suffered and so did Algorand. The coin slumped below the dollar as overall economic conditions were exacerbated by a series of crypto crashes, and it closed the year at around $0.17.
There was something of a recovery in 2023, with the coin reaching $0.29 in early February. Things then fell apart and the news that the SEC considered it to be an unregistered security, coupled with the cases against Binance and Coinbase causing concerns that it could be delisted, led to it drop.
On 10 June, it fell to a new all-time low of $0.0958. The coin then recovered to $0.1405 on 25 June, before another slide, exacerbated by the news of Algofi shutting down, saw it drop to $0.1031 on 13 July.
That day’s news that a judge had partially ruled in favour of Ripple in its court case with the SEC saw something of a short-lived fightback and, on 25 July 2023, ALGO was worth $0.1095.
At that point, there were about 7.8 billion ALGO in circulation, representing the total supply. This gave the coin a market cap of about $850 million, making it the 45th largest crypto by that measurement.
Algorand, a crypto which had been performing badly in the medium-term, took a real hit following the market turmoil surrounding the SEC’s lawsuits.
Although the coin’s price on 25 June represented a recovery of more than 45% from its record low, it fell more than 25% by 13 July. ALGO has recovered by 6% since then.
However, Algorand has suffered a month-on-month loss of more than 20%.
The price of ALGO has been on a long-term decline since it reached a peak on 13 September 2021. The cryptocurrency market entered a bearish phase in November that year, which means we have seen 90% decreases in the price of many altcoins, and ALGO has been one of them.
The price of Algorand fell more than 95% from its September 2021 peak to its 10 June all-time low of $0.0926 on June 10 this year.
While some altcoins were able to stay above their significant support levels and have made a recovery since the start of the year, ALGO was not one of them.
Algorand followed the market and made some gains in early 2023, but its drop to below $0.168 in the middle of May helped drive the price down to the levels it was trading at back in March 2020.
The price’s drop has pretty much wiped out any gains it has made since March 2020.
Although the price of ALGO has been going down, the Relative Strength Index (RSI) indicator suggests that the crypto is still not oversold.
Although it entered the oversold zone when it reached its low of 10 June, it recovered to the regular levels within a week.
The Bollinger Bands technical indicators are getting tighter, which suggests that we are going to see another move, probably downwards, in the coming days.
The price of ALGO has been going down since 21 February. The theory that price movements come in waves of five would show that the downturn Algorand took from 10 to 26 June was wave four, which means that we are currently in the fifth wave.
If that theory is true, we could see the price of ALGO drop below $0.10, potentially sinking as low as $0.0845 at some point in the not-too-distant future.
There is some cause for optimism, however. If the price stays above $0.094, then ALGO could end up making a comeback and could even enter a bullish phase. We will have to wait and see.
With that all said and done, it’s time to take a look at some of the Algorand price predictions that were being made on 25 July 2023. Remember that price forecasts, especially for something as potentially volatile as crypto, very often end up being wrong. Also, remember that many longer-term crypto price predictions are made using an algorithm, which can change at a moment’s notice.
Regarding a short-term Algorand price prediction, CoinCodex came up with something that seemed rather discouraging for ALGO’s remaining investors. The site said that the coin would stay at around $0.1095 until 29 July, before sliding down to $0.1079 by 23 August. Its technical analysis was, probably unsurprisingly, overwhelmingly bearish, with 28 indicators making downbeat signals compared to just two making positive ones.
When it came to other sites making their Algorand coin price predictions for 2023, DigitalCoinPrice said that the coin could recover to double from current levels to reach an average of $0.22 some time this year. CryptoPredictions.com also said that the crypto could double in price, reaching $0.2448 in December. CoinPriceForecast , on the other hand, said that while there would be a fightback, it would be nowhere near as spectacular, with the crypto trading at $0.17 at the end of the year.
When it came to an Algorand price prediction for 2025, CoinPriceForecast saw stagnation, followed by a slight upturn for the coin, with it standing at $0.17 in the middle of the year before reaching $0.18 in December. CryptoPredictions.com also saw some volatility, making an ALGO price prediction that saw it start the year at $0.2806, drop to $0.2608 in July and then close the year at $0.2909. DigitalCoinPrice, meanwhile, was unperturbed by the thought of turbulence, with it saying Algorand should be worth $0.37 that year.
As far as a long-term Algorand price prediction for 2030 was concerned, PricePrediction.net was very optimistic, saying that ALGO could trade at $1.92 that year. DigitalCoinPrice also thought the coin would be worth more than a dollar then, with it predicting it to trade at $1.10. CoinPriceForecast, on the other hand, was a bit less bullish, saying Algorand would be worth $0.28 by the end of June and $0.30 by the end of December.
Algorand is a cryptocurrency that has, ultimately, suffered as a result of being overvalued when it first came out. The news that the SEC has considered it to be an unregistered security has exacerbated the problems the coin has faced as it has struggled in the wake of a series of crypto crashes over the last year or so. On the other hand, cryptos can be unpredictable, so there is certainly the potential for growth if the market conditions are right. You will have to do your own research before deciding whether or not ALGO is a good investment.
Algorand was set up as a so-called Ethereum Killer, but ETH has seemed distinctly unbothered by the actions of Silvio Micali’s blockchain. Indeed, the crypto has recently traded at a record low, which might be cause for concern.
The news that its biggest DeFi protocol is shutting down and that its Total Value Locked has collapsed over the last six months or so could also discourage investors.
On the other hand, though, there is a school of thought that says you should buy in the dip, but we don’t know how far this dip will last, nor when ALGO will recover, nor what it will recover too. As always with crypto, you will need to do your own research.
No one can really tell right now. However, the price forecasts are, on the whole, upbeat, price predictions, more often than not, end up being wrong. Remember, too, that prices can go down as well as up.
Before you invest in Algorand, you will need to do your own research, not only on ALGO but on other, similar, cryptos, like Ethereum (ETH). Even more importantly, you must make sure that you never invest more money than you can afford to lose.
On 12 June 2023, there were about there were about 7.8 billion ALGO in circulation, representing the total supply.
It could do, although it may take some time. PricePrediction.net says it could climb past the dollar in 2029 while DigitalCoinPrice predicts it happening the following year. It is worth noting that ALGO has traded above the dollar before, most recently in 2022.
ALGO is used to pay for transactions on the Algorand blockchain, and it can also be bought, sold, and traded on exchanges.
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