Introduction
You may be wondering what all the hype is about around NEAR. Let’s break down what the NEAR protocol is and whether it has a chance to be more than just another blockchain.
Near protocol is a Dapp(decentralized application platform) running on the proof-of-stake(POS) NEAR blockchain. Its goal is to be fast, secure and infinitely scalable. The blockchain runs on hundreds of machines around the world and aims to solve the 3 challenges facing the industry: usability, scalability and security.
Usability
In order for a platform to gain traction the onboarding process needs to be easy. NEAR does this by abstracting the technical layer from the end user. Making it possible for users to interact with dapps with no prior knowledge of blockchain technology. Accounts have human readable names like John.near and offer a more traditional web experience. Developer usability plays a role in adoption and NEAR has created tools to more easily learn, develop, test and deploy to their ecosystem. Smart contracts written in Rust with future plans to allow more common programming languages to be used. NEAR provides modular components like NFT implementations, token contracts and marketplaces to help developers streamline the process. Examples can be found in the NEAR Github repo Here
Scalability
With the goal of infinite scalability, in order to grow with increased adoption NEAR has implemented sharding. A scaling solution that breaks up large sets of data into smaller pieces called shards which makes it possible to run processes in parallel. NEAR uses an alternative sharding method called Nightshade, a dynamic sharding method that significantly speeds up transactions per second(TPS). The NEAR team states that a 100,000+ TPS is possible which would surpass major credit cards. For the end user this means quicker transaction finality and performance.
Security
Using the Proof-of-stake mechanism NEAR has a network of validators that verify transactions. With 100 block producing validators as well as thousands of delegators. Delegators participate in network security by delegating their tokens to validators. The more delegators you have the more decentralized the network becomes. Validators are currently rewarded through a distribution of 45m NEAR tokens per year. NEAR plans to open up positions for additional validators in the future.
NEAR Token
The NEAR Token is the native asset of the NEAR ecosystem. Each token is a unique digital asset. It allows participants to interact economically with the ecosystem. Token use cases such as:
Payment for processing transactions and storing data
Running a validator node
Participate in ecosystem governance
Total supply will be 1 Billion with a current circulating supply of 675 Million.
Why NEAR?
NEAR is a next-generation blockchain protocol attempting to create an inclusive experience for both user and developer. For users it offers familiar login and account features while still providing blockchain security, low transaction fees and almost instantaneous transaction confirmation. Developers, builders and creators can iterate quickly using NEARs powerful toolkit without having to worry about scalability and onboarding difficulties. NEAR is continuously innovating and communicating to build a better, inclusive web experience.
Important Protocols
Take note that the NEAR ecosystem is growing rapidly and many companies are competing for the top spots. Currently the most important protocols to keep an eye on are:
- Aurora Network - An EVM(Ethereum virtual machine) compatible layer built on the NEAR protocol. Fork existing Ethereum dapps over to the NEAR protocol.
- Rainbow Bridge - Seamlessly bridge your tokens between NEAR and Ethereum.
- Ref Finance - An AMM(aggregated market maker) on the NEAR protocol. Offering some of the best farming and stable coin APRs.
- USN - With the anticipated release of its native stable coin USN, NEAR looks to dive into the Defi space.
Closing Thoughts and Future
While only launching in 2020 NEAR has quickly grown its ecosystem and now ranks in the top 20 coins by market cap. By being open to the community and actively building in the space, NEAR aims to compete with giants like Ethereum, Solana and Terra. With an $800m developer fund NEAR has ample reserves for development as well as deep VC funding. The massive growth seen in the industry this year puts NEAR in a perfect position to shine.