NEAR is um A smart contract-enabled blockchain designed to be a next-generation platform for dapps, with its own unique scaling solution. NEAR Protocol is a layer-1 blockchain that uses sharding technology to achieve scalability. NEAR uses smart contracts and adopts the Proof of Stake (PoS) consensus mechanism to secure its network.
What is NEAR Protocol (NEAR)?
NEAR is a blockchain advanced tier-1 capable of running smart contracts and is more scalable for the future of decentralized application development. The NEAR Foundation is responsible for the NEAR Protocol blockchain and the ecosystem that surrounds it. It has its roots in the NEAR Collective, which is an extensive collection of people and companies collaborating to create one of the largest open source projects in this space. NEAR Collective’s focus is to build something user-friendly for developers and end users. Their goal is to have an entire ecosystem that everyone can seamlessly engage in without needing immense technical prowess.
As a significant part of blockchain technology is very difficult for the average user to understand, it is almost impossible for some people to get started in the community. The good news is that some members of this team have experience building a scalable database system that uses sharding. That’s why the unique Nightshade sharding system will be so crucial to the future of NEAR Coin.
Sharding is a concept from the world of relational databases. It allows a database to be scaled horizontally by splitting and distributing the data across multiple servers. The NEAR blockchain’s Nightshade algorithm makes it possible to infinitely scale the number of transactions the NEAR network can process per second. This killer feature separates it from coins like Bitcoin and Ether. Since scalability is built into the Tier 1 network, it doesn’t require a lot of the additions and hacks that networks like Ethereum do to get more performance. It also makes it very affordable to build your application on the network.
How does NEAR Protocol (NEAR) work?
NEAR uses its Nightshade technology to improve transaction fee effectiveness. Nightshade is a variation on sharding, in which individual sets of validators process transactions in parallel across multiple fragmented chains, improving the overall capacity of the blockchain. In contrast to “regular” sharding, shards in Nightshade produce a fraction of the next block, called “chunks”. In doing so, the NEAR Protocol is able to reach up to 100.000 transactions per second and close the transaction almost instantly, thanks to a one-second block cadence, while keeping transaction fees to near zero.
The NEAR Protocol also improves the complicated process of integrating with other blockchains, having human-intelligible addresses and creating decentralized applications with log flow similar to what users already know. In addition, it provides developers with modular components, helping them to start projects faster, such as token contracts or NFTs.
Nightshade and Fragmentation of Pieces
Unlike many other coins and blockchains, each validator on the NEAR network only holds a portion of the entire blockchain. This means that each validator can process transactions in parallel, making the entire network more robust and faster. With the hardware cost considerably reduced, it is possible to scale the NEAR Protocol blockchain even further. The obvious benefit is that transaction fees will become negligible, making it possible for developers to build large projects without the cost issues associated with the Ethereum network.
Doomslug consensus
One of the biggest problems with massively distributed network systems is building consensus among all nodes on the network. NEAR’s Doomslug consensus hits the mark in a single round of communication. Even in the worst case scenario, it achieves a 2x improvement in latency when compared to Tendermint, allowing the network to spend more time processing transactions than reaching consensus.
Rainbow Bridge
Rainbow Bridge makes it possible to send tokens between NEAR, Aurora and Ethereum. This quickly and inexpensively minimizes the number of transactions required to migrate from NEAR Coin to others. However, transferring to Ethereum can be very expensive if the network is congested and two transactions are needed to reach completion.
Aurora Layer 2 Scaling Solution
Aurora builds on the NEAR Protocol blockchain to create an Ethereum-compatible Layer 2 scaling solution. It provides the speed and scalability of the NEAR Protocol blockchain with the reach of Ethereum. This allows developers to create Ethereum compatible DApps more cheaply and comfortably. It also makes it easy to scale without worrying about bloated gas fees and other drawbacks that come with Ethereum and application development – as building DApps is built into the NEAR Protocol blockchain.
Main DApps of the NEAR protocol
No blockchain is worth much without the proper applications that people want to use. What makes the entire NEAR Protocol blockchain special is the killer applications it already has. What is NEAR doing now to make things better? NEAR Coin is one of the easiest to use coins available and simplifies application development. Combined with the features of Nightshade and Doomslug, NEAR Coin is ready to help with the development of many useful DApps for years to come. For now, the net has enough valuable programs that you will love it. So what is the NEAR protocol being used for now?
Near Protocol Ecosystem Fund
NEAR announced it has $800 million in ecosystem funding initiatives, following in the footsteps of several Tier-1 blockchains such as Avalanche, Fantom and Celo. The fund will be used to fund initiatives that focus on accelerating the growth of the NEAR protocol ecosystem. This includes $350 million in funding from Proximity Labs. Of the total funding, $250 million will be used to support existing projects, and $100 million will be allocated to Startup Grant Pools, where 20 startups will receive $5 million each.
NEAR is focused on funding Decentralized Finance (DeFi) teams that are “actively revolutionizing and reimagining the way we interact with money.” NEAR is also actively looking for projects based on NFTs, DAOs and games. Additionally, NEAR recently raised $150 million in seed investment led by Three Arrows Capital, with participation from Mechanism Capital, Dragonfly Capital, a16z, Jump, Alameda, Zee Prime and many others. This will be used to accelerate the adoption of Web3 technologies.
NEAR token
The maximum supply of NEAR tokens is 1 billion. This gives NEAR Coin enough flexibility to expand with market needs. However, there are not many coins to make the value less than a penny, as with so many others.
NEAR Protocol launched its mainnet on April 22, 2020, creating 1 billion NEAR tokens at genesis. Every year 5% of the additional supply to support the network is issued as epoch rewards, of which 90% goes to the validators (4,5% of the total) and 10% to the protocol treasury (0,5% of the total ). 30% of transaction fees are paid as discounts from contracts that interact with transactions, while the remaining 70% are burned. The NEAR token is used to:
- Transaction processing and data storage fees.
- Run validator nodes on the network by staking NEAR tokens.
- Governance votes to determine how network resources will be allocated.
NEAR Protocol (NEAR) Cryptocurrency Where to Buy
NEAR tokens can be purchased on several centralized cryptocurrency exchanges. One of the most recommended exchanges for buying and trading NEAR Protocol is Binance.
On Binance, the most active trading pair is NEAR/USDT, which has seen significant trading volume, reaching over $89 million in the last 24 hours. This demonstrates the popularity and liquidity of this pair.
Other popular options include:
- Cooperatives
- bybit
These platforms offer different features and trading fees. It’s important to check the reputation and security of each exchange before purchasing.
When choosing an exchange, consider factors such as fees, payment methods, and customer support. Ensuring transaction security is essential for a smooth experience in the cryptocurrency market.
Is NEAR a good investment?
Many coins have come and gone in the blink of an eye, including meme coins. Combine that with the many pumping and dumping schemes in this industry, and it’s very difficult to figure out if NEAR has the staying power needed to compete with the big, established currencies. It’s even harder to predict whether NEAR will be here in the next few years.
The good news is that the NEAR Protocol recently raised $350 million. This funding round was led by Tiger Global, but many other large companies are also in the mix. However, this is a recent occurrence, and there was a $150 million funding round prior to this recent one. This gives NEAR the staying power it needs to do great things. The money combined with the technical advantages that NEAR brings to the table can be devastating to its competitors.
Having said that, before making any investments, do your research, investing in cryptocurrencies is highly risky and speculative, and this article is not a writer’s recommendation to invest in cryptocurrencies.
Conclusion
NEAR Protocol has the technical resources and people behind it to help it become one of the best coins in the industry. If you’re looking for a preview of what the cryptocurrency world might become, look no further than NEAR. The combination of the Nightshade sharding design and the Doomsbug consensus algorithm is a killer. For newer investors and newbies to cryptocurrencies wondering what NEAR is, given all the technology and developments involved, it is clearly the future.
