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Apr 30, 2021

Algorand Transparency Report: April 30, 2021

By: Algorand

Disclaimer: Algorand Cayman SEZC and its wholly owned subsidiaries, all of which are Cayman Islands subsidiaries of Algorand, Inc., are now the sole owners of all tokens held by any of Algorand,  Inc. and its subsidiaries. References to “Algorand” in this transparency report refer to Algorand Cayman SEZC and its subsidiaries, and all transactions described in this report that use the Algo token are made by Algorand outside the United States with non-US counterparties or otherwise handled in full compliance with US securities laws and regulations.

Algorand is committed to providing full transparency into our actions and token holdings. As previously outlined, we will be providing transparency reports on a regular basis. This report covers the period from November 1, 2020 through April 30, 2020. 

Our wallet addresses, previous transparency reports, and statement of use can be found here

As of April 30st, Algorand beneficially owns 2.047B Algos. Of those, approximately 1.765B are held in the wallets we have publicly shared, and for the remaining 282M Algorand maintains legal ownership but not physical custody (as described below).

Use of tokens 

To date, there have been two primary uses of tokens held by Algorand: 1) incentives to build and contribute to the growth of the Algorand platform, and 2) development and growth of the financial ecosystem.

Incentives to contributors and application developers through token grants, competitions, and investments.  

Total Algos: ~240.5 (up from ~192M at last report)

  1. Investment in Borderless Capital: Approximately 159.1M tokens were contributed to Borderless Capital (previously Algo Capital). Borderless Capital is a fund that is unrelated organizationally to Algorand Inc. or its subsidiaries. 100M of these tokens are permanently held and remain locked by the fund while the value accrues to all fund participants. Confirmation of Borderless Capital’s holdings and their corresponding transparency statement can be found here.
  2. Equity Investments: Approximately 70.8M Algos have been used to date to invest in ecosystem partners. 
  3. Market Development: Approximately 6M Algos have been used to date to build global awareness and promote Algorand through both technical and marketing partnerships.
  4. Application Development: Approximately 4.6M Algos have been used to date to pay developers, vendors, and contractors for applications and services benefiting all members of the Algorand ecosystem including wallets, custody solutions, etc.

Development of the financial ecosystem by encouraging growth and liquidity through support of partner solutions including lending, staking, and market making.  

Total Algos: ~201M (up from 184.4M at last report)

  1. Lending: To date, approximately 159.1M Algos have been loaned and are held as collateral with 3rd parties to assist in the creation of lending markets. These tokens will be returned to Algorand.
  2. Market Making: To date, approximately 41.3M tokens have been loaned to various market makers to support exchange liquidity and create orderly markets. The Algo is currently traded on over 50 exchanges across over 100 trading pairs at those exchanges. These tokens will be returned to Algorand at the completion of their respective engagements.
  3. Miscellaneous: Approximately 84K Algos have been used to date for other purposes including product testing, payment of transaction fees, etc.

As described below, a limited number of tokens have been sold to fund development initiatives. All other token movements represent internal transfers between wallets for rebalancing. 

Since network launch, Algorand, Inc. has continued to reduce it’s voting influence over the network. Our commitment to responsible decentralization is described in more detail here.

Token Sales

As previously described, Algorand sells tokens periodically to fund development initiatives. Any sales will follow the guidelines below which have been designed to limit market impact. 

For any Algos sold by Algorand:

  • Any tokens scheduled to be sold will be sold via one or more approved 3rd parties, who will execute trades at their sole discretion within the guidelines specified here.
  • Algorand will be a Market Maker (never a taker of bids) and will offer its tokens only in the ask of the order book.
  • Algorand will not represent more than 1.5% of the total market volume in any given period.
  • The 3rd party structured seller has imposed an automatic rule that if the secondary market pricing (as reported on Messari.io) declines by more than 5% from the 7 day moving average, selling will automatically stop and resume when the observed price stabilizes.

During the period, Algorand sold approximately 72M tokens through the methodology described above. During this time, Algorand represented 0.21% of volume across major exchanges according to Messari.

Other Notes

Protocol Development

Algorand will continue to support core protocol development on an ongoing basis, at a minimum for AT LEAST the next 8 years and has received  330M Algos to fund grants and development efforts related to layer 1 support over this time. These Algos are included in our public wallets.

Decentralization of Algorand tokens

Algorand has begun decentralizing control of the 2B Algos received as part of the Founders’ reward. As other parties become responsible for these tokens through distributions and grants, Algorand, Inc.’s stake will decrease over time.