Growing NEAR’s Ecosystem with Decentralization
NEAR Protocol started in a small WeWork office in San Francisco in the summer of 2018. There were three of us at the time, thinking how we could leverage blockchain to solve some of the cross-border payment problems we were experiencing with the AI project we were building.
What started as trying to solve a practical problem as blockchain users led us down the crypto rabbit hole, like so many before us. Diving deep into the world of blockchain left us with the understanding that something needed to change. Blockchain was expensive, difficult to use, and not very scalable. It lacked the foundations for mass adoption. So we decided to do something to fix that.
Fast forward three years, and we — with lots more help in that SF office and around the world — built the blockchain we wanted to see as users.
Of course, the crypto ecosystem is a lot more than code: it’s a social and organizational movement on a truly global scale. Making the most of these new tools requires innovating on a lot more than just the technology. We have been building new ways for communities to gather, govern, and grow via the Guilds program and DAOs.
As this new world continues to scale around us, we’re moving quickly to decentralize our own organization to mirror this organic growth and ensure NEAR stays in the hands of its users.
Learnings from Google
Before we dive in, allow me to share a bit about my time at Google. From the outside, Google appears to be a single centralized company, but internally it’s quite a bit different. It’s really a large number of distinct teams working together.
Each team works on its own piece of a larger puzzle but is able to easily leverage any code or services produced by other teams. Anyone can contribute code to another team’s codebase, and has the freedom to take 20% of their time to spend on a passion project, or — if they are a senior engineer — pitch an idea to a VP to start a new project.
Google also built and spent a lot of energy to maintain the meritocracy. The levels at Google have a high correlation to the impact that person has had in the organization.
The major piece that I felt was missing from the Google puzzle was a market economy. As we talked about the impact of any particular project, it ended up being hard to evaluate it in absolute terms, and we had to rely on a lot of metrics hacking and intermediate goal creation.
For example, I was a contributor to Tensorflow, Google’s Open Source Machine Learning framework and one of the top projects on Github. The lack of any economic forces around a specific product made it challenging to assess how much impact our work had inside Google or on the wider tech world.
Similarly, a VP could decide to shut down a project for internal reasons which might not reflect the market’s needs. For example, a product is desired by the market, but it’s not within the scope or focus of the VP’s department.
Scaling Ecosystem
NEAR Ecosystem’s vision is to give every person control of their assets, data, and power of governance. This is done by enabling and fostering the Open Web: permissionless, decentralized, and user-first apps built using open technologies.
To achieve this, many of the same principles that are internal to Google are applied to the whole Ecosystem: all code is open and anyone can use and contribute to it; all services run on open technologies and can be leveraged and relied on anyone else; and the ecosystem follows the principles of meritocracy, rewarding contributors to the ecosystem, while adding a way for markets to determine which projects are succeeding.
To start, we’ve looked internally. Near Inc and NEAR Foundation, two major players in the ecosystem, have been plugging various holes as we expand the ecosystem by getting internal teams to build things that are missing. This is a fairly common approach since the people most familiar with the infrastructure, technology, and community will usually be able to execute the fastest.
An ecosystem expanding exponentially meant that no single organization could plan and hire talent. The tradeoff then was loss of focus. We found that the internal team was involved in too many projects simultaneously and constantly under-resourced. Some high profile projects cannibalized resources from others, especially the more critical community initiatives.
Notable NEAR Spinoffs
Now, as we have recently passed the one-year anniversary of NEAR’s Mainnet becoming permisionless and decentralized, we’ve begun a process of “spinning off” certain projects from within the NEAR core team. A spinoff, or spinout, happens when a core team already working on a specific project or vertical separates into an independent company.
The first and most well known spinout in the NEAR ecosystem is Aurora, an Ethereum compatibility layer that allows developers to operate apps targeted for Ethereum on NEAR’s high-throughput, scalable, and future-safe platform, with low transaction costs for their users.
Aurora technology was originally built by Near Inc engineers and a few external contributors, including Anton Bukov and James Prestwich. Beyond just building the software, to succeed Aurora needs its own marketing and business development working directly with projects across the Ethereum ecosystem to understand and address their scaling challenges. Aurora Labs, the new company that with former Near Inc developers, has already raised $12 million from top VCs like Pantera, Electric Capital, and Dragonfly.
Aurora’s mission is distinct and specific even though it clearly fits into the broader NEAR ecosystem and the shared Open Web vision. It also brings the NEAR and Ethereum ecosystems closer with top projects like Sushi, 1inch, ImToken, Etherscan, and others committed to launching on Aurora.
A few more spinoffs took place this summer, and several more are now finalizing their spinout process.
Another recent spinoff is Proximity Labs, a DeFi product and research studio that has helped projects like Ref Finance and Skyward launch, as well as assisted native lending protocol Burrow, with more apps in the pipeline. Since launch, Ref Finance has accrued more than $170 million in total value locked on NEAR. Skyward, meanwhile, has raised more than 5m $NEAR (equivalent to $50m USD at the time of this writing) with its radically new IDO platform.
Satori, the team that built the NFT.HipHop pop-up shop that launched at the Universal Hip Hop Museum’s groundbreaking ceremony, is currently building crypto products and fan experiences for artists by leveraging NFTs on NEAR.
NEAR Pay, a collaboration between a NEAR core engineer and experts in traditional and crypto finance, will tie NEAR accounts and banking together into one seamless experience.
Finally, the first ever NEAR spinoff is Human Guild, a community led by two of the early NEARians, which focuses on earners in the NEAR ecosystem. Human Guild helps apps and platforms that provide play-to-earn and create-to-earn, in turn increasing the number of people who are participating in the NEAR economy.
In each case, these spinoffs are projects whose participants were already passionate and working within NEAR core teams. They were also working on other internal projects and splitting their attention between multiple goals. Now, with the clarity and focus of a spinoff, they are able to fundraise independently and build a team focused on delivering the best experience. They’re also much better positioned to achieve financial success since each team now has market-based incentive mechanics as well.
The NEAR ecosystem is starting to grow exponentially. Each project brings new users and more developers who are leveraging its technology. This flywheel is being added to by NEAR Foundation’s funding efforts, but also, more importantly, its roadmap to pass many of its functions to the Treasury DAO and other projects and DAOs in the ecosystem.
All of this lays the foundation for an ecosystem that is truly decentralized, and a world where people are in control of their money, their communities, and the tools to create new worlds for themselves.
If you’re looking to build on NEAR, check out our developer resources.
If you’re an entrepreneur and want to get started, head for our Founders space.
If you’re looking to create DAOs and Guilds, check out our Community Page.
