ALGO coin price prediction: Will ALGO bounce back?
Will new Falcon technology protect the crypto from the threats of quantum computing?
- What is Algorand?
- From the Algorand whitepaper
- ALGO’s price history
- Price spike
- El Salvador partnership
- Algorand price prediction
Since launching in 2019, the Algorand (ALGO) cryptocurrency has struggled to pass its initial coin offering (ICO) price.
ALGO’s price skyrocketed in September 2021, when the blockchain formed a partnership with Koibanx to build El Salvador’s cryptocurrency infrastructure. It has since lost most of these gains, but experts and price prediction websites are hopeful it can eventually reach such heights again.
So, what is next for the altcoin, and can we make an ALGO coin price prediction? First, let’s see how the Algorand blockchain works, and take a look at its price history.
What is Algorand?
ALGO is the native currency of Algorand, a blockchain that wants to address the ‘blockchain trilemma’ of security, speed and decentralisation. Algorand achieves this aim through a consensus system called pure proof-of-stake, which creates and validates its blocks. The block leader and validating committee are randomly selected, but it is weighted by the amount of ALGO a user stakes.
Silvio Micali, a professor at the Massachusetts Institute of Technology (MIT) in the US, founded Algorand in 2017, with the blockchain and native currency launched in June 2019. Only a day after launching, the ALGO coin price immediately crashed.
From the Algorand whitepaper
The Algorand Theoretical Paper was originally published on 26 May 2017 and is 75 pages long.
The whitepaper states: “Algorand is a truly democratic and efficient way to implement a public ledger. Unlike prior implementations based on proof-of-work, it requires a negligible amount of computation and generates a transaction history that will not fork with overwhelmingly high probability.”
It goes on to say: “The Algorand approach applies to blockchains and, more generally, to any method of generating a tamper-proof sequence of blocks. We actually put forward a new method – alternative to, and more efficient than, blockchains – that may be of independent interest.”
ALGO’s price history
ALGO’s ICO was held in June 2019, with the price at $2.40. On 22 June, its first day of trading, the price dropped to $2.16. This was just the beginning as the price continued its bearish trend throughout the next few months, reaching a low of $0.19 on 27 September 2019.
There were many reasons for this crash. The first was the expanding token supply of 10 billion that would gradually be released. Algorand announced three billion ALGO would be released over the first five years from its launch date through public auctions. The large pool of ALGO, combined with investors valuing it at $24bn, proved too much for the market despite the strong public interest.
Private investors were another possible cause of ALGO’s coin price crash. Investors bought ALGO in private placement rounds that set a price for the coin from $0.05 to $0.50. By the time the token launched it was valued at $2.16, which enabled private investors to gain large profits.
Chen Fangfang, the previous head of operations at the Algorand Foundation, wrote a letter to the investment community. According to Global Coin Research, the letter said that early supporters had injected unnecessary risks into the project, including dumping tokens and short-selling.
ALGO’s coin price did see a spike on 14 August 2019, after it was listed on Coinbase. Algorand claimed it was one of the fastest on the platform. The price was around the $0.56 mark in July and reached $0.80 on 9 August when the news was announced. Despite a few spikes, ALGO struggled to get above the $0.50 mark over the next 18 months of trading, let alone surpass its launch price.
The currency started seeing a bullish trend at the beginning of 2021. Throughout January it was priced around the $0.56 mark, but on 12 February 2021 it hit a multi-year high of $1.71.
As with ALGO’s earlier price crash, this spike had several potential reasons. The first, at the beginning of 2021, was a growing interest in stablecoins. Stablecoins combine the decentralised nature of cryptocurrency with the stability of fiat money. As Ethereum had high gas prices at the beginning of 2021, Algorand became a viable alternative for stablecoin issuers.
Algorand was also generating interest through a partnership with Instimatch Global, a short-term money market trading platform. This started in January and by February, millions of dollars in transactions per quarter were going through Algorand.
El Salvador partnership
ALGO’s coin price did dip below the $1 mark between May and August 2021. However, it then saw its price rise. On 31 August, El Salvador announced its cryptocurrency infrastructure would be built on Algorand. The coin was then trading at around $1.12. Over the course of the following few days, the price shot up to a new post-launch all-time high of $2.38 on 12 September 2021.
On 29 September 2021, Algorand launched a new update that improved smart contracts by allowing them to be written in well-known computer languages including Python and Reach, but that did little to help the downward trajectory, and the coin closed the month at $1.63.
The ALGO coin price was very volatile between October and December, but continued trading sideways, and closed 2021 out at $1.66. The coin fell further to $0.90 by 14 February 2022, and $0.67 a month later, the coin’s lowest value since August.
ALGO recently saw some recovery when filesharing software developer LimeWire chose Algorand to power its NFT marketplace. The token hit $0.80 on 21 March 2022 and raced to $0.97 on 2 April. But it was unable to sustain these gains and dropped below the $0.80 barrier.
At the beginning of May, FIFA announced its partnership with Algorand, meaning the network will become the official blockchain platform of FIFA, and provide the official blockchain-supported wallet solution. However, the Q2 bull runs were short-lived, and by mid-May, a market-wide crash saw ALGO trading at lows of $0.36. The destabilisation of the market continued, and by the end of June, the token closed trading at $0.31, and $0.34 by the end of July.
In order to compete in the rapidly maturing digital asset space, Algorand has introduced the ‘Falcon’ upgrades to the protocol, a silver lining given current conditions.
Their blog update elaborates: “Algorand State Proofs fortify cross-chain applications with Post-Quantum security. By using advanced cryptography, ASPs can withstand attacks by powerful quantum computers that try to alter the reported state of the blockchain, providing a robust, portable source of truth about on-chain data.”
At the time of writing on 22 August 2022, ALGO is hovering at approximately $0.30.
Let’s take a look at some of the ALGO coin predictions and see if another bull run is likely.
Algorand price prediction
Gov Capital’s ALGO coin price prediction for 2022 sees the coin close in December at $0.44, before reaching $1.45 in a year’s time. The site’s ALGO price prediction for 2025 is for the coin to break the $4 mark in August.
WalletInvestor has a bearish Algorand price prediction. It sees the coin sinking to $0.02 within a year and does not predict any meaningful recovery thereafter. The site describes ALGO as a “bad long-term (one-year) investment”.
DigitalCoinPrice projects an average value for the coin of $0.39 in 2022. The site also suggests the coin could be worth $0.45 in 2023 and $0.58 in 2025. Its ALGO price prediction for 2030 is for the coin to reach up to $1.38.
The token put on a good show in 2021, staying above previous averages and reaching a new all-time high in September. That said, the volatility typical of lower-value altcoins, including ALGO, was on full display.
Having lost most of its 2021 gains, Algorand investors will be hoping it can follow predictions and turn its recent breakout into a sustained rally.
Is ALGO coin a good investment?
It might be: Gov Capital and DigitalCoinPrice both forecast an upward trend in 2022. But remember, predictions can often be wrong – so do your own research before investing.
What is the ALGO coin price prediction for 2025?
Gov Capital has projections for the coin to break the $4 mark in August 2025, and DigitalCoinPrice believes it will be even slower.
All price predictions are based on historical data and are not accurate representations of all market conditions. Cryptocurrencies are highly volatile, and past performance does not guarantee future profits.
How to buy ALGO coin
If you want to buy ALGO, then you can do so at a range of exchanges, including Currency.com. Just remember to do your research first, and never invest more money than you can afford to lose.