Algorand misrepresents its performance against Bitcoin

Algorand misrepresents its performance against Bitcoin

Blockchain startup Algorand cited incorrect Bitcoin stats while marketing its own network. The startup claimed that its network handled over 50,000 transactions in less than a month, which it said was equivalent to what Bitcoin does every six months when the network actually does 1.8 million transactions in that time.

Algorand says it had a successful month following token sale

Algorand, a Boston-based blockchain company created to improve blockchain decentralization, made the news last month after it successfully completed a $60 million token sale. The company’s token sale implied that Algo token’s market capitalization was close to $6 billion, which would make it the seventh-largest coin—above Binance’s BNB and just below EOS.

The company’s successful token sale and mainnet launch didn’t last long though, as Algo’s value plummeted just days after the sale. But, the company maintained that everything was going according to plan, saying they had a successful month.

Algorand issued various marketing texts citing their accomplishment during the last month. The company’s CEO Steven Kokinos participated in several AMA sessions, answering questions about the state of the network.

However, the company’s claims were put to the test by a well-known independent cryptocurrency analyst and blogger, who found that some of the data Algorand provided was not only exaggerated but completely incorrect.

Crypto blogger calls out Algorand for sharing wrong stats

The analyst, who goes by the name of Hasu on Twitter, called the comparison “incredibly disingenuous marketing” by Algorand. He found several instances where the company used incorrect data when comparing its transaction volume to that of Bitcoin.

While it’s unclear where the text was pulled from, the same wrong data is used on two separate occasions.

According to Hasu’s tweet, Algorand claimed it handled over 50,000 transactions since the launch of its mainnet less than a month ago. That, the company said, was equivalent to “roughly 6 months of Bitcoin transactions.”

According to data from Blockchain.com, Bitcoin network is confirming almost 300k transactions per day as of July 2019.

This wasn’t a one-time mistake, either. Steven Kokinos, the company’s CEO, used the same data during an AMA.

“In the first two weeks of live mainnet, over 50,000 transactions have been processed, which is roughly equivalent to 6 months of Bitcoin transactions or 2-3 months of Ethereum transactions,” he wrote.

And while Kokinos and Algorand were quick to react to the twitter thread, issuing an apology for using wrong stats, the crypto community still found it to be odd for a data-conscious company.

Users accused Algorand of intentionally using the wrong information to trick investors into believing their network was doing better than Bitcoin.

Others said that using incorrect data from the world’s most transparent data record was a very bad idea.

We are yet to see whether this information spreads and affects Algorand’s price in the following days.

Algorand | ALGO

Updated: Nov 7 at 2:52 am UTC

Algorand, currently ranked #1868 by market cap, is up 2.25% over the past 24 hours. ALGO has a market cap of $0 with a 24 hour volume of $147.31M.

Chart by CryptoCompare

Algorand is up 2.25% over the past 24 hours.

Posted In: , Altcoins, Analysis, Price Watch

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Priyeshu Garg

Priyeshu Garg

Analyst @ CryptoSlate

Priyeshu is a software engineer who is passionate about machine learning and blockchain technology. He holds an engineering degree in computer science engineering and is a passionate economist. He built his first digital marketing startup when he was a teenager, and worked with multiple Fortune 500 companies along with smaller firms. When he is not solving transportation problems at his company (Ola), he can be found writing about the blockchain or roller skating with his friends.

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