What is NEAR (NEAR) Protocol Crypto? Should You Buy Now?

Blockchain financial technology to secure cryptocurrencies as bitcoin for online payments and money transaction.
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The NEAR protocol was built by Alexander Skidanov and Illia Polosukhin in 2018, and NEAR crypto is the ecosystem’s native token. The pair initially held roles in companies such as Google, Microsoft and MemSQL before co-founding NEAR Inc. They initially set out working on a machine learning project but slowly pivoted towards blockchain technology.

NEAR is on a path to creating the decentralized, permission-less “open web.” This means no company, no government and no individual person has the ability to shut it down. It relies on code and users instead. 

Using Meta Platforms, Inc. — formerly known as Facebook — as a comparative example, NEAR doesn’t want to create what it deems a closed, biased ecosystem. Instead, NEAR wants to build a place where users control their own data. 

NEAR’s solution is what it coins the “community cloud,” where users can store “meaningful things like money, identity and digital assets and securely transact them with anyone without requiring someone else’s permission or platform.”

What Is NEAR Protocol?

NEAR is a Layer-1 blockchain solution built for an ecosystem’s underlying base network and infrastructure. Bitcoin and Ethereum are examples of some other Layer-1 blockchains. These blockchains finalize and validate transactions as well as secure the network from malicious behavior by incentivizing validators with rewards. In this case, validators are rewarded with NEAR cryptocurrency tokens.

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NEAR’s team compares its solution to existing centralized platforms such as Amazon Web Services and Microsoft Azure. However, NEAR’s differentiator is the distributed number of validators that secure the network with no single point of failure. This aims to prevent tampering, hacking, removal and loss of data, as well as negating other inefficiencies associated with a cloud platform controlled by a sole entity.

The primary goal of NEAR crypto is to help users regain control of three pillars:

  • Data
  • Assets
  • Governance

How Does NEAR Protocol Work?

The NEAR protocol optimizes user and developer benefits, which helps to foster wider adoption. Entrepreneurs and developers can create decentralized applications and open-source software that can generate cash flow while maintaining a user’s ownership of the data. 

NEAR also aims to solve two crucial issues that predecessors have failed to overcome: system design and organization design. These issues have led to problems in relation to usability and scalability, with the primary concern being transaction processing times in periods of high volume. NEAR solves this issue through proof of stake and its self-calibrated nightshade technology. 

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Nightshade technology uses a process known as “sharding” to reduce user fees. This means each node can be split into “shards” which operate their own set of data, thereby fostering increased network throughput. This permits much higher transaction volume than some other networks, processing roughly 100,000 transactions per second. 

NEAR wasn’t just built with the “blockchain-savvy” in mind, either. By building an experience that resembles a typical individual’s Web 2.0 experience, NEAR has the potential to bring in a wide array of users, not just crypto-enthusiasts.

For developers, NEAR uses Web Assembly and Rust ⁠– two easy-to-use programming languages for running nodes and smart contracts. Developers can program ownership, encryption and storage with all the tools provided to build the open web. NEAR describes that significant drop-off rates estimated between 97% and 99% occur when developers experience frustration when creating and maintaining apps, so it has simplified tasks so anyone can interact with the network.

NEAR Protocol’s Performance

NEAR has appreciated significantly in value and has been on an upward trajectory since its inception. The token’s price and market cap topped out at roughly $12 billion in January 2022 but it has gone on to become one of the largest cryptocurrencies in the world, boasting a spot among the top 20 cryptocurrencies by market capitalization. 

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The average 24-hour trading volume has risen steadily over the last several months too, suggesting adoption is rising. It’s also one of the cheapest cryptocurrencies to buy, making it attractive to new crypto investors.

A negative, however, is that NEAR is currently limited by its availability on exchanges. The NEAR token is yet to be listed on Coinbase but it is available for trading on Binance, so it’s important to compare cryptocurrency exchanges before investing.

Good To Know

Investing in any cryptocurrency asset carries risk due to a number of factors, including limited regulation, unproven technology, and unproven returns. However, the number of developers gives credibility to NEAR’s long-term goals to haul in 1 billion users within the next five years.

Expert Opinions on NEAR Crypto

Andreesen Horowitz, a reputable venture capitalist fund, backs the project. The fund has been associated with several other successful, well-known projects and companies such as Coinbase, Alchemy, Keep, Maker, OpenSea, Solana, Celo and Trust. Others in the industry have followed suit by investing in the NEAR protocol, including:

  • Blockchange Ventures
  • ParaFi Capital
  • MetaWeb Ventures
  • Hashed
  • Republic Capital Group
  • Tiger Global 
  • FTX Ventures
  • Dragonfly Capital Management
  • Einsvill Labs
  • 6th Man Ventures

The most recent funding round led by Tiger Global has seen $350 million raised to support further development, acting as a short-term catalyst that led to price appreciation for NEAR crypto holders.

Is It Worth Investing in NEAR?

NEAR has sprung rapidly to the list of top 20 cryptocurrencies, but it is still extremely early on in its development. It’s a good idea to keep an eye on its progression before making a large investment. 

However, the signs are telling so far, and NEAR looks set to cement its position if it continues to execute. To illustrate, none of this existed four years ago. NEAR transformed from a small team in an office in San Francisco to where it is now. Adoption has sped up at an incredible pace, and the statistics from a recent presentation are encouraging. This includes:

  • More than 40 million total transactions
  • More than 1 million accounts on the network 
  • More than 1,000 people building on the NEAR Protocol monthly
  • More than 200 ongoing projects
  • More than 200 decentralized autonomous organizations

The token has the potential to produce outsized returns and become one of the best Web 3.0 cryptocurrencies to buy. The stakes are high, and an investment could lose some or all of its value.

Data is subject to change.

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About the Author

David is a qualified financial advisor in the Republic of Ireland. He has a bachelor's degree in business and entrepreneurship, as well as over five years of investing experience.
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