Will Algorand Resume Uptrend After Ethereum Bridge?
Algorand went live in 2019 and did the ICO (initial coin offering) in June that year. Algorand is a very scalable Layer-1 blockchain, that addresses the issues that have been plaguing Bitcoin and Ethereum blockchains, such as slow transactions and high mining costs. It offers low transaction costs of 0.001 Algos per transaction, fast transactions at over 1000TPS and carbon negative. Therefore it is ranked among Ethereum killer pretenders, since it offers an attractive ecosystem to host and run dApps with greater efficiency.
It’s for this reason that El Salvador has partnered with Koibanx in order to develop the country’s blockchain infrastructure using the Algorand blockchain network. Algorand is also adding Waivlength, which is a social media platform. Blockchain networks are expanding into the social networking space as well as in the decentralized online media, after DeFi and NFTs.
But, Algorand has had a weakness, that it is not compatible with the Ethereum Virtual Machine (EVM). Ethereum leads in the number of applications built on its blockchain, and not being compatible with Ethereum means that you are out of a major part of the DApp market. But, the Algorand team is taking care of that.
Algorand Funding EVM Programmes
Algorand Foundation CEO Staci Warden told CoinDesk earlier this week that “We’re inspired by the depth of talent and activity in the Ethereum network and we’re committed to a multichain world”. Algorand is introducing two programs, worth $10 million each, one of which will go to developers that can provide solutions for compatibility with the EVM, while the other will finance projects that can build helpful developer tools for the Algorand blockchain.
So, Algorand is trying to build a bridge to Ethereum, which will allow it to enter the robust developer community of the Ethereum network, as well as incentivizing new developers by making it easier to build on Algorand. So both programs should help increase the number of projects on the Algorand network.
Algorand Technical Analysis – ALGO/USD Weekly Chart
Will the 100 SMA Hold for Algorand?
Algorand had a great year in 2021, increasing from around $0.30 in January to $2.86 by November. In May we saw a major retreat lower, as the crypto crackdown in China turned the sentiment negative and ALGO/USD retreated to $0.70, where it formed a support zone. The 50 SMA (yellow) held as support at that zone and eventually the price reversed higher as the sentiment improved in the market.
But the crypto crackdown continues and in November we saw another bearish reversal. The support zone at around $1.75 which used to be the high early last year was broken but the 50 SMA (yellow) held as support again. Although, the 50 SMA couldn’t hold for too long as the decline in the crypto market continued in January and the price fell to the 100 SMA (gray). This moving average has been holding in the last few weeks, but might be broken as the price is sticking to it. Below that we still have the support zone around $0.70, so we are watching the price action and might be tempted to buy this digital coin.
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