What is NEAR Protocol (NEAR)?

The rise in popularity of the Ethereum network has prompted the emergence of numerous blockchain platforms aspiring to establish an ecosystem of decentralized finance (DeFi) and decentralized applications (DApps). While Ethereum has attracted many new users and laid the groundwork for a new crypto industry, its scalability and network density problems have given rise to alternative platforms. One such alternative is the NEAR Protocol, a topic that will be explored in this article.

What is Near Protocol (NEAR)?

Near Protocol (NEAR) is a decentralized platform that supports the creation of DeFi and DApps ecosystems. It is compatible with Ethereum, allowing developers to add NEAR to their network. NEAR is designed as a fast and cheap Layer-1 blockchain, utilizing sharding for high scalability and fast transaction processing. NEAR coin is its native cryptocurrency, currently ranking 18th in market cap with $10.9 billion, priced at $16.3 per coin, and has a maximum supply of 1 billion NEAR with around 667 million already circulating.

Who Created NEAR?

NEAR was established in 2018 by Illia Polosukhin and Alexander Skidanov, both skilled programmers with experience at Microsoft and Google, respectively. They saw the limitations of existing blockchain technology, including slow speed, high cost, and limited transaction capacity. In contrast to Ethereum's complex and challenging programming process, NEAR aims to simplify development for average application developers by adopting industry standards from Google and Microsoft. As a result, NEAR prioritizes convenience for developers wanting to build applications within its ecosystem.

tokenomics">NEAR Tokenomics

The NEAR token has three main uses: network security, transaction fees, and data storage, and it can also be used as a means of exchange. One unique feature is the ability to rent data storage space by locking NEAR tokens, providing long-term profitability and discouraging users from selling or using it as collateral. This helps maintain the NEAR price stability as large amounts of tokens do not suddenly unlock over the next 2 years.

How Does NEAR Work?

The NEAR Protocol is a blockchain that operates on a proof-of-stake (PoS) mechanism. Unlike traditional cryptocurrencies, there is no need for mining as the network relies on validators to secure the system, and all tokens have already been generated since its launch. NEAR Protocol follows four key principles in designing its network infrastructure. Firstly, it focuses on usability, making it simple for developers to create and deploy contracts. Secondly, scalability is essential, ensuring the platform can handle growth without limitations. Additionally, continuous decentralization is emphasized by reducing barriers for validators to participate. Similar to other PoS networks like Solana, Polkadot, and Fantom, NEAR enables fast and cost-effective transactions.