Try Quests to earn cryptoAlgorand Price Correlation
Methodology:
First I used fact_hourly_token_prices for ETH and BTC price(it would be possible to use algorand.prices_swap but the price on some points of the chart would be incorrect and it might make some misunderstanding) for Algo price I use prices_swap from Algorand databases, then I try to see the correlation of these prices. For comparing Algo Price with transactions, transfers, and swaps I used their databases and try to count distinct transactions to have a good comparison.
Algorand (ALGO) is an open-source, payments-focused blockchain network that aims to solve one of the most persistent problems facing cryptocurrency: scalability. To do that, Algorand employs a novel, more scalable form of “proof-of-stake,” a consensus mechanism that’s critical for securing blockchains and making sure no one can create new tokens out of thin air that they didn’t earn.
ALGO price
The supply of Algorand’s native cryptocurrency, ALGO, is capped at 10 billion tokens, created at the time Algorand launched in 2019. Many of those coins are locked up and have yet to be distributed.
Some of the tokens have been allocated to the organizations that are developing the Algorand platform. The allocation includes the following:
- 2 billion (20%) of ALGO went to Algorand Inc., which reports in detail how it uses the funds on its website.
- 500 million (5%) of the total supply was allocated to the Algorand Foundation, which leads the development of the project.
By comparing the price of Algo with BTC and ETH, it can be seen that they are roughly correlated with each other in most movements and have the same movement steps.
Algo chart made with the help of swaps prices; in January, these prices are different from the real price.
By comparing the price chart of Algo and the number of transactions done each day, at first glance, there is no clear correlation, but if we look more carefully, we will see that on the days when the price has reached its floor or peak, the number of transactions has increased compared to the previous days.
For example, on the dates between December 17 and December 27, 2021, the number of transactions has been recorded more than on other days, and by observing the price in this period and after that, it can be seen that the price has started an upward rally after that(from 1.3$ to 2.3$).
In general, the number of transactions decreased with a relatively gentle slope as the price dropped.
By comparing the price chart, as well as the number of swaps done every day, as well as Algo transfers, we can almost reach the same analysis as before.