Being a technological company, Algorand has made an exceptional blockchain that is permissionless and open. It uses a pure proof-of-stake blockchain protocol that sets it apart from its counterparts.
Despite having these features, the Algorand company does not compromise on top notch security, great scalability and a well decentralised system. Decentralised financial systems and traditional finance meet a level ground with Algorand to create a frictionless finance world.
Algorand’s smart contract architecture seeks to further assert the incredible place that this technology has taken globally. As a system, it has invested in features and technological advancements to provide answers to the problems of the traditional smart contracts.
Naturally, smart contracts provide a transparent, precise and distinct programming system for transferring assets. However, Algorand takes a different route to solve financial problems and create a different approach to smart contracts. It uses a two-tier layer architecture, Layer 1 focuses on providing a high level of security for daily transactions and Layer- 2 architecture is concerned with off-chain contracts that deal with more customised smart contracts.
What Does Algorand Layer-1 Smart Contract Architecture Offer?
Transactions Independent of Smart Contracts
The Algorand system allows users to make transactions independent of smart contracts. Layer 1 smart contracts prevent users from double spending.
Secure Atomic Transfers
Algorand Layer-1 solves the traditional blockchain problem of atomic swaps by creating an inbuilt mechanism responsible for the authorisation of multiple transfers as a single atomic unit for suspicious parties.
User-defined Tokens
Furthermore, Algorand gives its users the liberty to create user-defined tokens.With Algorand, one can build user based Algorand assets that are just as secure and safe as the native Algo currency.
In-built Direct Support Mechanism
Algorand blockchain system was put together world leading developers. They built a system that protects unintentional creation and discarding of tokens. To crown it all, the system gives direct support for optional minting, clawing back, freezing and burning tokens. The direct support that Algorand Layer-1 contracts provide is not limited to only tokens. It also extends to scuritized loans, crowdfunding, “post and sale” transactions and simple recurrent types of transactions.
Expressive Power
Algorand is concerned with providing its users with an expressive power on their system. It uses TEAL machine language that enhances user liberty while providing guaranteed off-chain contract’s security.
What Does Algorand Layer-2 Smart Contract Architecture Offer?
Fast And Quick Transactions
The Algorand layer-2 architecture is concerned with off-chain contracts that allows a system that does not slow down block production. Even when a high level of transactions are done, the blockchain’s throughput remains unaffected. This process is fast and quick in getting your transactions in place.
Highly Protected System
Algorand uses a secure method to choose its contract execution committee. This system is deterministic as the committee is made with a randomized, self-selection algorithm. However, this contract execution committee is committed to achieving an unperturbed high level of security with about 150 validators instead of the usual thousands.
Unlike the machine language in Algorand Layer-1 smart contract architecture, the off-chain contract is written in a high level language of code. This is used to create a secure smart contract that is protected from harm.
Smaller Number Of Consensus Committee
The traditional blockchain needs an executive committee quorum of validators for the validation of a call’s effects. Apart from being time consuming, the call’s effects are highly dependent because together they either fail or succeed. Algorand’s system takes very short time for the transactions because its checks are done with a smaller number of consensus committee. For security, the long-lived state of the off-chain contract which is the contract storage, is not shown on the block chain. However, a commitment is what each contract call publishes to the recent contract storage.
Assured Correctness
By using this off-chain contract, correctness is greatly assured. This blockchain system keeps proper track of the contract call dependencies. The system guarantees that dependencies whose call effects have been violated would never find their ways to the blockchain.
High Level Of Transaction Success
Algorand is confident that most of their off-chain contracts would succeed because the dependencies of the contract is majorly under the user’s control. They believe that users would never want to do anything that would cause a violation of their own dependencies.
Increased User Responsibility
Not only do they give a high level of liberty but also the system is used to create more successful ones. Apart from that, Algorand puts its users in a situation where they have to bear the responsibility for the violation of their dependencies. This would also save the blockchain company from having to listen to incessant customer complaints. With this process, a contract call is more guaranteed to make it on to the chain after passing the contract committee’s validation.
Easily Scalable System
This blockchain system is easily scalable for users regardless of how big their contracts may be. It also covers contracts that are computationally demanding or difficult. All of these transactions are handled without creating a clog or queue for others on the blockchain system. There is an easy flow of transactions for all users.
Flexible Blockchain Technology
Algorand builds a blockchain system that is flexible. It’s smart contract architecture is not intimately intertwined with the blockchain architecture. Off-chain contracts are isolated from the consensus committee so that the transactions would take lesser time than traditional blockchains. This reveals Algorand’s commitment of being a problem solving blockchain technology across the globe.
Conclusion
Apart from what Algorand currently offers its users, it focuses on a future where multiple contract committees can be enabled. They also plan to form a collaboration for the wide adoption of their off-chain contracts. However, the power that Algorand gives its users can be considered as being much but the blockchain has a high security for different scenarios.
