You cannot yet buy ALGO directly with IDR, so you’ll have to go through another cryptocurrency such as Bitcoin.
The following steps explain how to buy Bitcoin (BTC) with Indonesian rupiah and then how to buy Algorand with Bitcoin. This example walks through buying ALGO with some of the most popular exchanges, but they aren’t the only options, so you may want to compare a range of options first.
Visit the Luno website and then click “sign up” in the top right corner of the page. Before you can start purchasing, you will need to verify your identity by providing the following:
Your email address
Your phone number
Proof of ID
Proof of residency
A photo of yourself holding a signed statement
You should enable 2-factor authentication on your Luno account for extra security before moving on to step 2.
Once you’ve logged into Luno and gotten verified, you can click on the “Deposit IDR” button on your account dashboard. This will give you three ways of making a deposit:
Internet or mobile banking
Making a payment via ATM or using Internet or mobile banking is the quickest option but incurs a deposit fee of IDR4,000 for every transaction.
Once you’ve made a deposit, you can buy Bitcoin with IDR by clicking the “Buy/Sell” tab at the top of the page.
Select Bitcoin from the list, choose “buy” and then enter the amount you want to purchase.
Double check all the details and the price. If everything is in order, confirm the transaction.
You can now transfer your Bitcoin to an exchange that supports Algorand. In this example, we’ll use Binance – the world’s most popular exchange by volume.
To register for a Binance account, visit the site and select “register” from the top bar.
You will be required to enter and verify your email address and choose a password. No other identity verification is required unless you want to raise your withdrawal limits, but 2-factor authentication is strongly recommended.
Algorand, founded in 2017, says it’s a permissionless, public and decentralised blockchain. It’s similar to Bitcoin or Ethereum in this respect.
It’s designed to serve as a base-level blockchain protocol on which other dapps can be built and smart contracts operated.
One thing that makes Algorand different is that it claims to be highly scalable, so it’s not prone to the same bottlenecks or fee issues that Bitcoin or Ethereum frequently are. It uses a proof-of-stake system that provides immediate transaction finality, which eliminates a lot of the “forking” problems of earlier blockchains.
As a proof-of-stake system, it encourages ALGO holders to “stake” their tokens, and essentially become ALGO “miners”. Token holders can enjoy some governance powers. In both network consensus and governance, a super-majority of users is required to pass decisions.
It also offers unique economic innovations, including a public token dispersal process through periodic Dutch auctions. The basic tenet is that the market will always ensure a fair ALGO price, and that users will be able to return their ALGO for 90% of the purchase price for up to a year after the purchase, as a kind of algorithmic “satisfaction guaranteed” arrangement.
The team behind Algorand has attracted a lot of attention. Most notably, it was founded by Turing Award-winning computer scientist Silvio Micali.
What to consider before you buy ALGO
There are risks involved in purchasing any cryptocurrency, and even though ALGO aims to offer more assurances through its money-back and Dutch auction system, it still carries many of the same risks as any other cryptocurrency, including a complete loss of funds in the event of hacking or other misadventure.
Other factors to consider include the following:
The prevalence of protocol-level blockchain tokens: There are a lot of base-level blockchain protocols out there, and Algorand is operating in an extremely competitive area.
Complications: The Algorand system is complex, and there may be issues with bugs or other errors down the line.
Regulatory issues: As a public, permissionless blockchain protocol, Algorand occupies something of a regulatory grey area, and it may be unpredictably affected by regulatory shifts.
User participation: Algorand emphasises user participation, but this might be lacking if everyone is only interested in it for speculation.
High initial valuation: In its first Dutch auction, ALGO tokens sold for $2.40. If that’s the “correct” price, it means the total ALGO market cap is $24 billion, which gives it one of the highest market caps of all coins. When considering whether ALGO is over- or under-valued at its current prices, remember that its total supply is 10 billion and extrapolate accordingly.
Disclaimer: Cryptocurrencies are speculative, complex and involve significant risks – they are highly
volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of
future performance. Consider your own circumstances, and obtain your own advice, before relying on this information.
You should also verify the nature of any product or service (including its legal status and relevant regulatory
requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may
have holdings in the cryptocurrencies discussed.
Andrew Munro is the cryptocurrency editor at Finder. He was initially writing about insurance, when he accidentally fell in love with digital currency and distributed ledger technology (aka “the blockchain”). Andrew has a Bachelor of Arts from the University of New South Wales, and has written guides about everything from industrial pigments to cosmetic surgery.
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