NEAR Protocol

NEAR is the native coin for the Near Protocol, a smart contract blockchain that wants to take on Ethereum.

Launched in 2020, Near is cheaper and faster than Ethereum, and claims to be able to scale – grow without hindering its performance or making things more expensive – thanks to a consensus protocol called Doomslug and a sharding called Nightshade.

NEAR set its all-time high of $20.42 in January 2022, after the token skyrocketed in 2021. The price of the coin sank shortly thereafter to around half that, but as of May 2022 remains far higher than the range of $1-$2 it traded at toward the end of 2020.

At launch, Near created a billion coins and then allocated them to contributors and early investors, such as those who contributed to the $21.6 million March 2020 token sale, as well as community grants and programs.

NEAR’s issuance schedule is inflationary, meaning that the number of NEAR tokens in circulation rises over time. Its supply increases for two reasons:

NEAR’s supply is not capped, but generally increases over time; new coins are issued at a rate of about 5% a year. Ninety percent of those new tokens goes to validators, and 10% goes to the protocol’s treasury. Data from Messari predicts that the supply of NEAR coins could reach over 1.3 billion by early 2027.

That inflation, however, depends on the popularity of the network – the protocol increases its supply at about 5% a rate less transaction fees. Near burns 70% of transaction fees, and NEAR could become a deflationary token if the number of daily transactions surpasses about 1.5 billion.

Near is a proof-of-stake blockchain that relies on a consensus protocol called Nightshade. Nightshade allows Near to operate at about 100,000 transactions per second, and process a block a second. Transaction fees are virtually negligible.

Near has hung its hat on a technology called sharding, where transactions contained within a block are split into smaller pieces. Individual nodes focus on validating these smaller blocks simultaneously rather than the whole blockchain at once. The idea is that through sharding, blockchains can become more efficient at processing transactions.

The NEAR token is used to incentivize validators, and it’s also the coin used to process transactions and power smart contracts. Near is building support for the Ethereum Virtual Machine (EVM), which allows developers to deploy their Ethereum-based decentralized finance protocols on Near without having to change much of the code.

Near was founded in 2018 and launched its main network in October 2020. The project now operates via a decentralized autonomous organization, meaning holders of NEAR coins can vote on the future of the platform.

In January 2022, Near raised $150 million from venture capital firms such as Andreessen Horowitz, Dragonfly Capital and Jump Capital. In April 2022, Near raised $350 in a funding round that was led by Tiger Global. FTX Ventures and Dragonfly Capital.