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Is Algorand Eco Friendly (Explained)

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So many cryptocurrency projects claim to be green and eco-friendly. Some actually validate this claim with innovative technologies and unique ways of securing their networks. Others pay credits for their carbon emissions and participate in other green projects. Algorand is one of them.

Let’s answer some questions you may have about Algorand as we take a look at what else they’re doing to reduce the effects of climate change.

Is Algorand Eco-Friendly? 

Algorand is an eco-friendly cryptocurrency. Because of its internal design, Algorand has succeeded in making its cryptocurrency sustainable in three unique ways.

Designed with Sustainability in Mind

Like other coins, such as Cardano and Solana, energy efficiency and sustainability are two key features built into the Algorand system.

ALGO uses a Pure Proof of Stake (PPoS) mechanism to validate new transactions and create new blocks. This mechanism reduces energy consumption. 

This Proof of Stake model answers Bitcoin’s Proof of Work (PoW) model. The PoW model is infamous for consuming massive amounts of electricity and using physical computing power.

For example, it takes 930 kWh to process a single Bitcoin transaction. That’s enough power to charge 25 Nissan Leaf electric cars for one hour! Algorand uses just a fraction of a kilowatt-hour, at just 0.000008 per transaction. 

Fewer mining rigs mean less e-waste and reduced power consumption. That also reduces carbon emissions, making Algorand a green alternative to many top crypto coins, including Ethereum and Bitcoin.

Also read: Is XLM Eco Friendly?

Green Partnerships

Algorand has partnered with ClimateTrade, a company that uses blockchain-based solutions to promote transparency and traceability of sustainability efforts in other companies worldwide.

At the same time, ClimateTrade uses Algorand to power its global marketplace for carbon credits. Other organizations that have adopted Algorand include PlanetWatch and GlobalCarbon Holding.

Offsetting ALGO’s Emission Gaps

As Algorand wants to become carbon negative, it has implemented a sustainability plan that uses advanced smart contracts to allocate a certain amount of credits into a green treasury. These credits pay for any small carbon footprint the Algorand protocol may leave behind. 

What is Algorand Used For?

The primary use for Algorand is for developers to create new applications fueled by cryptocurrency on their platform. Alogrand uses open-source code that you can find and download from the Algorand Foundation website.

Digital Assets & Entertainment

Algorand reimagines how creators, publishers, and consumers interact.

An excellent example of this is Xfinite. This company uses ALGO to protect content, manage data, and offer transparency to content users, creators and investors. Those invested in Xfinite can stake via Algorand.

Financial Institutions and Fintech

Financial institutions are using the permissionless features of Algorand to expand their activities in the financial markets. Cartan is a fine example of how a company can use Algorand to create and implement complex market strategies to develop new business opportunities and insights.


You can use the Algorand ecosystem to build stablecoins — for example, Monerium.

Monerium uses Algorand to issue regulated e-money on blockchains across the EU, Iceland, and Norway that you can send or receive online without using banks and payment providers. 

Learn more about how Terra Luna stablecoin works.

What Is the Impact of Algorand on the Environment?

Algorand is carbon neutral and working towards being carbon negative. Because of its Proof-of-Stake block mining mechanism, Algorand increases its energy efficiency exponentially.

A node in the Algorand ecosystem can run on a device as simple as a Raspberry Pi.

As mentioned above, Algorand further increases its carbon efficiency by partnering with ClimateTrade and paying to offset any minor carbon produced by the Algorand network.

What Are the Pros of Algorand?

Here are some benefits of using Algorand

  • Algorand is quick and inexpensive with transactions, charging as low as $0.001 and completing transactions in under five seconds.
  • Algorand is robust against attacks. Attackers can’t trace or hack the network unless the malicious side of the network holds 51%
  • ALGO is decentralized and straightforward to use. You don’t need powerful computer equipment or use plenty of energy to run Algorand.
  • As an Algorand holder, the more tokens you hold, the higher the chances of voting.
  • The Algorand algorithm picks participants and chooses who can add or recommend new blocks to its blockchain. Any participant with an entire block can take part.
  • Once you have your ALGO tokens in their official wallet, you qualify to participate in special transactions.

What Are the Cons of Algorand?

Although there isn’t much, here are some downsides to using Algorand:

  • Algorand faces stiff competition from newer crypto coins, especially for solving decentralization, scalability, and security issues. Some coins contending with Algorand for the top spot include XLM, Cardano, and Polkadot.
  • Unlike its peers, ALGO has fewer participants. However, market insights show that this might change in the future.

Is Algorand a Good Eco-Friendly Alternative to Bitcoin?

Yes. Algorand is an excellent alternative to Bitcoin, especially if you’re looking for energy efficiency. Besides that, Algorand is faster, cheaper, and offers more functionality than Bitcoin currently provides.

Yes. Algorand is more eco-friendly than Chainlink.

Algorand runs on its PPoS blockchain, whereas Chainlink depends on the Ethereum blockchain to thrive. This connection to Ethereum makes Chainlink less energy efficient compared to ALGO.

Final Thoughts

If you are looking for a friendly and easy cryptocurrency to use, Algorand is your best pick.

It runs on a friendly and simple algorithm that anyone can use. Whether you are an advanced participant or entry-level, you can get started as quickly as possible.

Also, because of the adoption of crypto tech, the future for ALGO is bright. Now is the perfect time to participate in the network or join the ALGO bandwagon at affordable prices.