ALGO is here! The star project, initiated by Turing Award winner and MIT professor Silvio Micali, raised more than $60 million in the first auction on the 20th, and the final token price was set at $2.40. After the auction, the first-line exchanges such as Firecoin, OKEx and Coinan announced that they had put on the ALGO, BKEX, Matcha and other online exchanges. They can also say that ALGO is the “Six-God Pack”. After the opening of the market, ALGO has fallen back. It is currently reported at $2.53, which has been 50 times higher than the private offer price of 0.05.
Source: Fire Coin
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Why is Net Red ALGO fire?
Algorand aims to create a borderless economy and opportunities. Its core technology solves the triangulation problem of the existing blockchain, that is, security, scalability, and decentralization can only satisfy two at the same time. Most of the Algorand team was born at MIT, including many heavyweight experts including Turing Award winners.
ALGO is so popular because it uses the Dutch auction for ICO. Dutch auctions, also known as reduced-price auctions, auction auctions are decremented from high to low, until the first person's price is the auction success. That is, the item starts from a very high price, and the price decreases according to the time progress. If the price falls to the psychological expectation of the bidder, he can directly buy it, and then no other person will compete.
Algorand is preparing to put 3 billion Algo into circulation in a Dutch auction for 5 years, auctioning 25 million each time, twice a month, for a total of 120 auctions. The token will be circulated after the auction is over and will not be locked. Yesterday was the first auction, but users in the United States, Canada, China and other regions were unable to participate in the auction. During Algorand's Dutch auction, Algo's price linearly decreased from $10 in time until the full supply of 25 million units was sold, to the clearing price, or to $0.1 after five hours.
The most powerful part of Algorand is the put option (put option), which can also be seen as a repo mechanism. If ALGO is sold for more than $1, then all investors (ie, those who are more than $1) can get a 7-day refund after one year, during which time 90% of the funds can be returned. This is still very attractive for investors.
Algorand is the "funding disk" at the Turing Award level?
For the design of Algorand's option, the founding partner of Primitive Ventures, Wan Hui, today believes that Algorand is a high-intelligence “funding disk” and praises it as a “funding disk” at the Turing Award level.
She believes that the most powerful part of Algorand is to design the repurchase mechanism as a put option, anchoring the exercise price of the put option to the price of the open market. In other words, set a hard bottom for the ALGO price, as long as the price falls more than 10%, the people who participate in the auction will buy, because they can arbitrage at a higher price.
She believes that:
“With the design of a price mechanism, Algorand successfully guided the expectations of both parties involved in the transaction. It is really a very clever game design. For the first time, it can be called cryptography economics. How much repo should be paid in the end? Conversely, as long as the seller knows 'I can always be 90% guaranteed within a year'. Effective expected management is the real magic."
So the question is, what new mechanism does Algorand introduce after the one-year put option expires after the first auction?
ALGO is here, TALGO is here too.
Considering this put option is so easy to use, Algorand's launch has also spawned a new transaction item – RMGO. At present, the Hufu trading platform has been launched on TALGO. TALGO is distributed to users who have invested in ALGO in Hufu. They hold 1ALGO to get 1TALGO, and TALGO can return the same number of ALGO in Hufu platform. Of course, users can trade on the exchange through TALGO/USDT transactions.
Considering the huge volatility of the encryption market, it is not impossible for ALGO's price to fall below 90% of the auction price. Then the right to withdraw the currency also means a huge arbitrage opportunity. Of course, ALGO prices may also go up all the way. It is worth noting that the right to withdraw the currency needs to be exercised within 7 days after the expiration of the lock period. This 7 days and a period of time ago may be welcoming the TALGO market.
For investors holding TAlGO, staying in insurance or selling them is another issue that needs to be considered.