The Algorand Foundation and Algorand Inc have announced a significant upgrade to its layer-1 protocol that will enhance the platform’s abilities to power complex decentralized applications, including DeFi projects scalable to tens of millions of daily transactions with low fees.
Algorand Protocol Update To Enhance DeFi Solutions
The company announced the protocol upgrade in a press release shared with CryptoPotato. It described it as the “launch of comprehensive smart contract capabilities that will enable the creation of DeFi solutions and dApps that can scale to billions of users, tens of millions of daily transactions, with negligible transaction fees, all while taking advantage of the layer-1 benefits of the Algorand protocol.”
The statement admitted that scaling issues, slow transaction speeds, and high fees restrict the blockchain and DeFi fields to reach mass adoption. However, Algorand’s upgrade aims to remove these obstacles and enable DeFi and dApp developers to build more sophisticated solutions and scale their applications.
The announcement specified that the integration will join all existing layer-1 protocol capabilities, including Atomic Transfers, stateless smart contracts, and Algorand Standard Assets (ASA1s).
The costs of operating with these features will be “trivial – 0.001 ALGO,” and it will enable the powering of multiple DeFi features – from credit and lending to marketplaces and decentralized exchanges. The statement outlined the company’s growth, as it has attracted over 400 projects into its ecosystem launched approximately a year ago.
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DeFi Can Change The Financial World
While commenting on the product upgrade, Algorand founder Silvio Micali asserted that DeFi has the potential to make a considerable change for the better to the current financial system.
As such, the company’s upgrade will serve “as a solid foundation to power truly frictionless applications, and our approach to smart contracts makes them high-performing and functionally advanced enough to rival today’s existing financial services.”
Kendrick Nguyen, Co-Founder and CEO of Republic, one of the companies employing the Algorand network, said that his firm chose Algorand because “of the functionality on a cost-effective platform at scale.”
“Since the launch of Republic’s digital asset on the Algorand blockchain we have been impressed by the performance, scalability, and strategic value it brought to the Republic ecosystem.” – added Nguyen. Consequently, he believes that the new upgrade comes at the right time during the ongoing DeFi popularity boost.
