Today’s blockchains have achieved significant progress. The total Crypto Market Capitalization skyrocketed from roughly $15 billion in 2017 to $2.34 trillion as of today (15600%). Bitcoin, the original blockchain which launched in 2008 has been priced at over $1.2 trillion, Ethereum is following at the 2nd place with the value of $427 billion.
Unfortunately, these original networks are facing problems of scalability, security, and usability. In this article, we would like to introduce a high-overview about Near Protocol and its ecosystem. The protocol aims to represent an evolution beyond what has come before it and is the first decentralized application platform to solve all of the three key challenges mentioned above to gain mainstream adoption.
We will cover plenty of useful information about the Near ecosystem and some predictions from Coin98 Insights:
- Near overview, Near token, and Roadmap.
- The ecosystem on Near Protocol.
- Predictions and investment opportunities with the Near Ecosystem.
So let’s get started!
- Near Overview
- All About Near Ecosystem
- Predictions about Near Ecosystem's Future
- Investment opportunities with Near Ecosystem
What is Near?
NEAR is a blockchain platform allowing developers and entrepreneurs to build applications and secure high-value assets such as money or identity, etc. while making them friendly and usable enough for consumers to access.
In history, Near had an impressive fundraising result. It successfully raised almost $35M and has been backed by the most well-known venture capitals and firms such as Coinbase Ventures, a16z, Multicoin Capital, Pantera, Arrington XRP Capital, IOSG Venture, Libertus Capital,...
NEAR uses a sharding approach which allows the network to increase its capacity, throughput, and finality as additional nodes participate. It aims to achieve 100,000 TPS at 1M nodes, ~1s finality.
End-User Usability and Developer Usability: Besides providing familiar web experiences for their users, Near has a number of supports for developers, allowing them to learn, develop, test, and deploy their applications easily. It supports contracts written in Rust and AssemblyScript, creates Robust Tooling - the NEAR’s development suite - to equip developers with a set of tools so developers can easily build, test and deploy applications.
Leveraging NEAR's performance with Ethereum Virtual Machine (EVM): Ethereum developers don’t need to learn an entirely new language to build applications on Near.
In total, Near is having 138 projects in all categories, 54 Dapps include 19 DeFi projects, 20 NFTs and Gaming projects, and 8 DAO projects. DeFi projects recently have moved pretty fast with notable ones such as Ref Finance, OIN Finance, Flux Protocol, Metapool, etc.
- Ticker: NEAR.
- Blockchain: Near.
- Consensus: Proof of Stake (PoS).
- Token Type: Coin.
- Circulating Supply: 474,395,299.00 NEAR
- Max Supply: 1,000,000,000
- Total Supply: 1,000,000,000
- All-Time High (Sep 09, 2021): $11.83
- All-Time Low (Nov 04, 2020): $0.526
- Exchanges: Binance, Huobi, Gate.io, OKEx, etc.
- TPS: 100,000 TPS at 1M nodes, ~1s finality
- Validators: 60
- Blocktime: 1.01s.
- Total transactions: 34,712,493
- Total accounts: 1,120,800
- Avg. Tx fee ($): 0.005$.
Partners and Backers
- Aurora: An Ethereum Virtual Machine created by the team at the NEAR Protocol.
- Crust Network: Is essentially an IPFS incentive layer protocol and a substrate-based blockchain that builds a decentralized storage network of Web3.0 ecosystem.
- Octopus Network: A sidechain network to host Web3.0 application-specific blockchains, aka appchains, around NEAR protocol.
- The Graph: An indexing protocol for querying networks like Ethereum and IPFS. Anyone can build and publish open APIs, called subgraphs, making data easily accessible.
- Coin98 Wallet: Coin98 Wallet is the #1 non-custodial, multi-chain wallet and DeFi gateway, designed to seamlessly connect users to the crypto world in a safe and secure manner.
- ChainLink: Is a decentralized oracle network that provides real-world data to smart contracts on the blockchain.
- Band Protocol: Is a cross-chain data oracle platform that aggregates and connects real-world data and APIs to smart contracts.
Near is backed by Coinbase - a top venture capital firm. Other backers include a16z, Multicoin Capital, Pantera - they are picky investors and have high standards when it comes to evaluating investment opportunities. Similar to BSC which is backed by Binance and Solana which is backed by Alameda Research, Near would receive generous supports from those backers and has its own advantage edges to accelerate in the long run.
a) 2018 - 2020: Formation of Near Protocol and its Mainnet
- In August 2018, Illia Polosukhin and Alexander Skidanov started Near.ai. From April 2020 to August 2020, the mainnet was launched and the testnet was running in parallel with validators.
- The team continued code and security reviews until October 2010 when Near protocol governance responsibilities were handed over to the community as decided by an on-chain governance vote. This stage also unlocked token transfers and protocol rewards.
→ It means that Near Protocol has turned to be community-operated and that its node hardware is run by independent participants and no entity controls sufficient stake to override decisions made on the network, giving the network better security.
b) Q2 and Q3 2021: Critical infrastructure components have been launched and integrated.
- Rainbow Bridge (4/2021) - Network Integration: a bridge developed by the NEAR Foundation to connect the Ethereum and NEAR blockchains.
- Aurora - an EVM built on the NEAR Protocol, aims for full compatibility with Ethereum development tools.
- First and flagship DApps launched on Near include Ref Finance (AMM DEX); Metapool (Staking pool), Oin Finance (Lending), Paras (NFTs Marketplace), etc.
- Near active accounts exceeded 1M for the first time in September 2021.
2. Upcoming plans - Q4 2021 to Q4 2022
- Phase 0: Simple Nightshade (expected delivery in November 2021): Near will shard the state, but not process them. Validators will still track all shards.
- Phase 1: Chunk-Only Producers (expected delivery in January 2022): Near will introduce a new role: chunk-only producers, who only validate one shard. This phase helps increase the total number of validators and improve the decentralization of NEAR. Once this phase is complete, there will be 200-400 validators and only a fraction of them need to run more expensive hardware.
- Phase 2 - Nightshade (expected delivery in 2022 Q3) and Phase 3 - Dynamic Resharding (expected delivery in 2022 Q4): Elimination of the need for any validators to track all the shards. Once this step is completed, both state and processing will be fully sharded.
→ Then the expansion on the fully shared version will continue, the TPS on Near Protocol will increase from 5 to 8 times, 100,000 TPS at 1M nodes, and approximately 1s finality. The network will become more secured, increase significantly its throughput and finality.
All About Near Ecosystem
1. Rainbow Bridge
The fully-functional NEAR — ETH rainbow bridge. It enables the transfer of any token, NFT, or asset between the NEAR and Ethereum blockchains. Total assets issued on Rainbow Bridge from Sep 27th to Oct 3rd, 2021 increased 10.16% compared to the previous week.
Blockchain bridges are important for DeFi development specifically and for any ecosystem in general. They create asset flows and interoperability between blockchains. Rainbow Bridge enables users to transfer digital assets from Ethereum - a blockchain that holds significant value to Near - the one that is developing its DeFi ecosystem and in need of additional liquidity. It is also excited to see SOL <> NEAR and BSC <> NEAR bridges that are under development currently.
2. Octopus Network
A sidechain network to bootstrap and run Web3.0 application-specific blockchains, aka appchains. The Octopus Network launched its mainnet in September and its first appchain on October 8th. When Octopus runs in its full capacity, 30-50 appchains will be launched in the network annually.
3. Aurora - an EVM built on the NEAR Protocol, aims for full compatibility with Ethereum development tools. Aurora launched its validator on NEAR and started charging delegators with 9% fees to ensure transactions remain free for users. The fee will be adjusted over time according to the amount of the delegated funds.
Flux, ChainLink, and Band Protocol are oracles that provide smart contracts with access to off-chain data feeds. Services from both ChainLink and Band Protocol have not mainnet on Near yet and Flux Protocol is the first oracle originally developed on NEAR Protocol at this moment.
Metapool - a liquid staking protocol built on Near - announced its partnership with OIN FInance to bring the first native stablecoins to Near Ecosystem - stUSD. Users will be able to enjoy the staking rewards on Metapool, while having stUSD in their wallets to use.
Lending & Borrowing
1. OIN Finance
A decentralized multi-chain stablecoin issuance protocol. OIN Finance has received a grant of $25,000 from the NEAR Foundation to develop OINDAO. Recently OIN Finance introduced its partnership with Metapool to issue the first Near-backed stablecoin, which will add DeFi functionality to the NEAR token and unlock liquidity for NEAR holders.
Lending and Borrowing projects have the same importance as AMMs in terms of assets and money flows retention. They maximize profits for DeFi players. DeFi players can deposit assets that they want to hold for the long term, earn interests, and are still be able to get new assets minted to use on other projects.
OIN Finance has not introduced many details or functionalities on Near Protocol yet and the Lending/ Borrowing lego on Near ecosystem really needs to show much better performance to help the whole ecosystem bootstrap.
AMM DEXes are undoubtedly necessary to any ecosystem since their abilities to attract huge amounts of volume and liquidity. AMM DEXes contain most of the important liquidity pools of their ecosystems and also act as places for DeFi users earn additional rewards through Yield Farming activities.
Near Ecosystem has only one AMM currently - Ref Finance.
Ref Finance is similar in design to Uniswap. It is a stack of DeFi services and products built around a core AMM. The project has big plans for upcoming 2022, major developments include:
- Ref Finance will launch stableswap pools.
- An orderbook style DEX.
- A lending service.
NearPad is A launchpad, DEX Aggregator, and Yield Aggregator of the Near Ecosystem. The platform will also be the first DAO-led protocol on Aurora by giving its community complete control over the treasury and public funds.
2. Skyward Finance
Skyward Finance is the first IDO platform on the NEAR protocol using the Streaming Time-based Auction mechanism. Skyward Finance’s goal is to enable fair token distribution for projects built on Near Protocol.
NFTs and Application
Mintbase is a global platform that allows anyone to create NFTs without worrying about technical complexities.
Paras is an NFT marketplace that focuses on digital collectibles. Paras started with digital art cards that were inspired by real-world trading cards and has expanded its digital collectible marketplace to other kinds of assets.
Pluminite is an NFT marketplace that allows you to mint NFTs. Users do not need NEAR tokens to get started as Pluminite will front the cost of the first three mints!
NFTs on Near are somewhat attracting attention from communities. There have been no sources tracking their volumes and revenues yet however, the numbers of followers of both Paras and Mintbase are 15.9K and 27.8K consecutively, which are pretty substantial.
Paras takes 5% of every transaction on its platform including the secondary market sales. The fee is quite high compared to other NFT Marketplace projects such as OpenSea (2.5% fee + ETH gas fee), Artion (Fantom’s NFT Marketplace, 0% commission), etc. Hopefully, the team can improve the fee structure or add substantial advantage edges to increase its competitiveness.
Shroom Kingdom - the first play-to-earn video game built with web technologies running on the NEAR Protocol Blockchain. Other watch-worthy projects include OPGames, ZedRun, Near Lands, etc.
Predictions about Near Ecosystem's Future
As of today, the number of projects built on Near is still humble compared to other chains (138 projects in all categories) such as Solana (423 projects in all categories), Ethereum (220 DeFi projects), BSC (241 DeFi projects), etc. Investors can expect to see:
- More and more upcoming projects on Near Ecosystem, especially DeFi category and NFTs & Gaming category.
- dApp with attractive APYs and APRs to attract liquidity.
- Lending/ Borrowing category showing improved performance.
- ChainLink and Band Protocol launch their services on Near and feed off-chain data to Near’s on-chain network.
Near has almost completed its infrastructure and is switching to Phase 0 of Simple Nightshade - a step towards a fully sharded blockchain. This change will improve the total TPS by 5-8x and potentially reduce the storage cost. In the following phases, Near will increase the number of block producers on its mainnet to 100, then will introduce chunk-only producers and likely bring the total number of validators significantly higher.
Bridges to BSC and Solana are under development. When finished, they will attract substantial liquidity and money flow to the Near Ecosystem.
Coinbase listing: Even though Near is backed by Coinbase, it has not been listed on Coinbase yet.
Investment opportunities with Near Ecosystem
New projects will either require Near tokens for the gas fees or ask users to stake Near and earn rewards and privileges. The demand for Near tokens will probably increase.
The market cap of Near is about $7,9 billion. It is far lower than the market caps of various chains such as Cardano (roughly $100 billion), Solana ($77 billion), Polkadot ($34.8 billion), Ethereum ($416 billion) as of today. In terms of new blockchain technology, Near has the potential for further development and expansion.
Near holders also can stake Near tokens into validators and earn interests. As of today, there have been 60 active validators, $423M of Near has been staked and the average annual interest is 10.47%.
Two recent projects, Aurora and Metapool, have introduced the staking functionality on their websites. Staked Near value on Aurora has surged significantly by 58% within the last 30 days and the annual interest is 10.93%. Metapool will reward Near holders with stNEAR token which could be used in DeFi platforms or swapped back to NEAR without the requirement of waiting 52 to 65 hours.
Dapps on Near
Since the ecosystem is pretty much in its infancy, it is expected that a lot more meaningful projects are coming.
The AMM category is the one that should be watched closely. There is only one single AMM launched on Near currently (Ref Finance) so Near fans should not spare possibilities of new ones. Since AMMs are bread and butter for any ecosystem (because of their use cases and functionalities), they will flourish when ecosystems flourish and vice versa.
Currently, Ref Finance is having very impressive APYs of its nine provided pools. Pools with good APYs as of today include PARAS-wNEAR (114.5%); HAPI-wNEAR (45.5%), DAI-wNEAR (56.1%), OCT-wNEAR (40.9%). Stakers, however, should consider Impermanent Losses before actually staking their tokens in the pools.
For the last several months. Near Ecosystem’s focus seems to be on NFTs and Gaming projects. This category has outnumbered others obviously. Investors can consider “skinning-in-the-game”, creating and selling NFTs as well as participating in games in the early stages.
Investors also can consider projects which have had their products introduced but have not yet issued their tokens or have not run their mainnets at all; to experience them and earn chances to earn retroactive, For example, Ref Finance, Paras, Aurora, Octopus Network, Mintbase.
Recently, the first play-to-earn video game on Near Protocol - Shroom Kingdom - has announced an airdrop to its early users who meet its requirements.
There are currently 3 IDO platforms on Near Protocol: Skyward Finance, NearPad, and Transak. Since it is expected to have more upcoming projects launching, investors can consider looking for hidden gems and join their IDO sales. Below are ROIs of listed projects on Skyward Finance:
|Octopus Network||SKYWARD 25% Initial sale||PARAS 5% SALE|
|IDO Price||0.3 NEAR||3.792 NEAR||0.08 NEAR|
|Price at the end of the sale||0.762 NEAR||6.662 NEAR||0.119 NEAR|
Below are the main highlights for readers’ convenience:
- Quicktake 1: The DeFi category on Near ecosystem is still in its beginning stage.
- Quicktake 2: The infrastructure category is almost ready to run.
- Quicktake 3: Near lovers have some varieties of investment opportunities.
To conclude, the Near ecosystem is still new and relatively small when compared to other existing ecosystems. It has shown much more acceleration recently than it used to in the past. Hopefully, the article has provided readers with some meaningful and useful insights. Please leave any questions you have below, and we will get back to you as soon as we can!
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