NEAR PROTOCOL, A BLOCKCHAIN TO WATCH OUT FOR.

The NEAR token is one of the top 30 cryptocurrency and top gainers of the crypto market, it rose in value by 900% from its ATL within a period of 2 years .Within this short period, NEAR protocol also established a reputation of being one of the blockchains with fastest transaction fees and low transaction fees. This feat was achieved without being a threat to the environment as the operations of the protocol has been declared climate neutral by the South Pole.

WHAT IS NEAR PROTOCOL

NEAR is a layer 1 protocol created to incentivize a network of computers to ensure a decentralized platform where developers could create and launch decentralized applications with the provision of good speed, good throughput and an enhanced compatibility with other chains.

TEAM

Near protocol was founded by Alex Skidanu and Ilia Polosukhin in 2017. Skidanov worked former director of Enginnering and Senior Software Developer at database company, MemSQL, He also worked earlier as a software developer in Microsoft. Poluskin previously worked at Google and Salford System. The mainnet of NEAR was officially launched April 2020. Currently, Marieke Flament is the Chief Executive Officer of the blockchain, she had previously worked at Louis Vuitton, Boston Consulting Group, Mettle, and crypto organization, Circle.

MECHANISM

NEAR protocol employs the Proof of Stake mechanism where validators receive a reward for maintaining the blockchain’s security and validity by staking their coins on the network. The staked tokens can either be bought or borrowed via stake delegations, and just like every staking system; more staked tokens, more rewards. NEAR increases its token supply by 5% each year with 90% of the new tokens goes to the validators.

The validators ensure the security and validity of transactions on the NEAR protocol by a means known NIGHTSHADE or SHARDING. This involves the split of the network’s data into chunks or shards that will be handled by computers known as nodes. These nodes are capable of processing and adding data to the main chain and these activities are carried out in parallel. Each node works on a specific “chunk or shard” to the exclusion and non-interference of other nodes.

Another means employed by NEAR protocol is known as DOOMSLUG. This allows for permanent addition of blocks to the blockchain. Once the addition of the blocks are finalized,instant block confirmations are performe by the validators, who take turns verifying the blocks.

Veteran Cryptocurrency founder, Vitalik Butterin once stated that the three core vitals watched out for in every cryptocurrency launched is, decentralization, security, and user experience which has been a struggle for most coins as the achievement of one is most times at the detriment of the other. How has NEAR protocol handled these issues in relation to the chain?

DECENTRALIZATION

NEAR protocol operates independently as there is no body in total control or at the helm of affairs with regards the operation of the protocol. The sharding system allows for decentralization of power as different people are in charge of the verification of transactions. Although, there is a non-profit, open organization made up of the developers of the chain to guide the development of the network, decision making on the network does not solely lie on this organization, known as the NEAR foundation. Participants of the network also take parts in the decision making of the chain

The aim of the foundation is to abolish the foundation over time to allow the network to function completely decentralized. Token holders are needed in this exercise to ensure proper decentralized governance. To ensure this, there shall be a need for more adoption of NEAR by the web 3 community and more interest by existing users and new users in the governance and development of the chain.

NEAR protocol also launched a guild which is segregated into different communities based on their proximity or interest. The essence of the guild is to allow an environment where every user of the protocol can find a place of belonging in the ecosystem and make it easier to be able to contribute to matters affecting the blockchain. Some of these guilds have grown into big organizations and has helped to onboard more people into the chain.

SECURITY

The security of assets and transactions is of great importance to any user of web 3 or cryptocurrency as hacks are becoming a very common occurrence. The nightshade mechanism made use of by NEAR protocol helps to ensure a very secure experience for users. While the data is divided into chunks or shards making every node run the validation in a parallel order, a hack on any data only affects the compromised node, such hack shall not be able to spread across other nodes where data of other users are being validated. Each node functions as an independent body, hence while running validations on received data, there is no interference or intersection amongst nodes.

USER EXPERIENCE

Most times user experience is usually measured by scalability, transaction costs and user interface. These are all concepts that facilitate constant use of a chain by a user.

NEAR protocol is known for its infinite scalability and speed. The chain is capable of 100,000 transactions per second. This is possible with the nightshade mechanism which employed by the protocol. The distribution of data into smaller segments to be processed independently allows for greater efficiency. This enables the process of greater amount of transactions in seconds.

One of the notable features of the NEAR protocol is the low transaction fees. Cryptocurrency users have always expressed their displeasure over having to pay high transaction cost alongside the original transaction. Transaction costs at NEAR protocol are about $0.01, this is a feature lauded by most users.

NEAR protocol is also well known for its friendly user interface. A new user would most likely not need any guide to be able to operate or transact on the NEAR wallet. Up until recently, NEAR allowed for users to make use of actual names or nicknames as wallet addresses unlike the regular 54 based characters. This is a feature not common to most blockchains. This helps to create a familiar experience, users would not feel completely lost or aloof while operating on the chain.

There are some emerging concept and technologies into web 3 and cryptocurrencies as they continue to expand. These concepts have become vital to the operation and adoption of any coin or cryptocurrency, they include:

DECENTRALIZED FINANCE

This is a banking system in which only the contractual parties are involved. This is opposed to the traditional banking system, as such fiat is not made use of in Defi as government and other bodies have control over. Decentralized finance platforms search for suitable cryptocurrencies and blockchain to build their product on. With NEAR protocol’s infinite scalability, great transaction speed, low transaction fee and acute security, it should be the perfect chain for operations of decentralized finance.

However, that is not exactly the case, with these great features NEAR has to offer, there are still significantly less DeFi platforms and operations on the chain. The only reason that could be behind this is that NEAR is also behind in terms of community and active wallets, it may only be natural to be behind in defi operations as well.

Nevertheless, NEAR protocol still remains of the best blockchains for DeFi operations. There are some projects already launched for this purpose. The most well known ones are:

-REF FINANCE

This functions just like Uniswap on Ethereum blockchain. It allows assets to trade seamlessly and permisionless through liquidity pools managed by a smart contract. It also allows the launch of decentralized applications on the platform. An example of a dApp launched is Allbridge, where SOL|(Solana token) can be bridged to the NEAR token.

-RAINBOW BRIDGE

This DeFi platform allows users to bridge NEAR to Ethereum . Participants can easily transfer tokens and assets from Ethereum wallet to a NEAR wallet and vice versa.

NON-FUNGIBLE TOKENS (NFTs)

NFTs are the latest trend in cryptocurrency, where pictures or artworks are used to ascertain ownership over certain things. NFT creators have to launch on a crptocurrency blockchain since the value of the NFT shall be in cryptocurrency since it is a product of web 3.Ethereum and Solana chain are well reputable in this field, NEAR protocol has not been completely isolated from the launch of NFTs either.

There have been launch of notable and successful NFTs on NEAR protocol with values as high as $2000, An NFT launched on the NEAR protocol, Secret Skellies, has successfully launched 3 generations of NFTs on the protocol. However, there is still a significantly less volume of NFTs on NEAR when compared to its counterparts despite the great user experience the chain offers.

NEAR PROTOCOL TOKEN (NEAR)

The NEAR protocol launched its token when it launched its mainnet in 2020. The token is used for transaction costs and execution of contract. NEAR is also used as collateral security of the network, voting for decision making and governance concerning the network. Also, staking on the chain can only be done with the NEAR token.

The token has a total supply of $1 billion, a market capitalization of $3,231,739,359 and at the time of this article a trading volume of $87,946,446.Just like every other token on any cryptocurrency protocol, it is subjected to the volatility of the crypto market. The token launched with a token value of $1.34 which later dropped to $ 0.54 An All time low, few months after launch. After series of rise and drop of the value of the token, the NEAR token reached its all time high of $20.44 on January 16, 2020.

One of the aims of the NEAR protocol chain is to allow seamless operation within the chain and between NEAR protocol and other chains. This was what brought about AURORA, a layer 2 scaling protocol built on NEAR protocol.

AURORA

Aurora is a layer 2 scaling solution built on NEAR protocol for developers who wish to launch their Ethereum Decentralized Applications on NEAR since Aurora is built with EVM (Ethereum Virtual Machine). Aurora, through the use of EVM enables Ethereum users and developers to be able to link their Ethereum smart contracts and assets to NEAR seamlessly.

Aurora allows users of Ethereum to carry out their regular operations within the familiarity of ethereum but on a NEAR protocol interface. The implication of this is that Ethereum Dapps shall function within the scope of Ethereum but with less transaction fees, greater speed, better throughput and all other advantages using NEAR protocol.

The compatibility has been tested by developers and proven to be one of the best blockchains for seamless integration between two different chains. This innovation has been highly appreciated and welcomed by users and developers of both chains and is quickly becoming adopted by many Ethereum developers.

CONCLUSION

NEAR protocol has proven to be one coin to definitely watch out for due to its great features and the vast achievement within the short period of its launch. The NEAR token has fallen more than 80% from its ATH, and some fear that the token may not survive the bear market. However, NEAR protocol has made laudable efforts to ensure protection and survival of the token. It has secured huge funding and collaborations with huge and major companies. These include, $800 million funding initiative targeted at accelerated growth, and more recently a $500 million dollar funding was raised. NEAR protocol is backed by top VCs like A16Z, Pantera Capital, Electric coin, Tiger Global, amongst others.

Some days ago, NEAR protocol secured another collaboration with Coinbase, one of the largest and fully registered cryptocurrency exchange platforms. This involved the listing of NEAR token for exchange on the platform which took effect from the 1st of September, 2020. A learn to earn program was also launched for NEAR protocol on Coinbase, where a $3 dollar reward would be earned by anyone who takes the course which involves everything about NEAR protocol.

Most NEAR enthusiasts or users have often mentioned lack or inadequate marketing as the deficiencies of the chain, stating that the protocol has the ability to actively compete with other layer 1 protocols. The NEAR protocol paid attention to this as its recent activities are all tailored towards onboarding of persons into the blockchain.