What Is NEAR Protocol?

Nov 30, 2022
6 min read

This blog post will cover:

  • About NEAR Protocol (NEAR)
  • Where did NEAR Protocol (NEAR) come from?
  • What are the advantages of NEAR Protocol (NEAR)?
  • What are the disadvantages of NEAR Protocol (NEAR)?
  • How to buy NEAR Protocol (NEAR) on SimpleSwap?

About NEAR Protocol (NEAR)

NEAR Protocol is a blockchain with an open source code and a support of smart contracts to create decentralized applications. Protocol runs on the PoS consensus algorithm. Its cryptocurrency NEAR is used in staking to maintain the network and pay for its transactions.  

The initial emission of NEAR is 1,000,000,000 tokens. 12% of this quantity was sold during the ICO in 2020 and 18% — during the seven private funding rounds. 

The remaining coins are used for the NEAR ecosystem development. A big part also goes to the NEAR and NEAR Foundation teams. Moreover, the network issues 5% of new tokens every year. Most of them are spent to reward the validators. However, the 5% annual inflation doesn’t affect the price growth. 

Nowadays decentralized application platforms are very popular. The capabilities of such platforms are used not only by cryptocurrency projects but also by the banking sector. Thanks to developments in the direction of solving the problem of scaling and transaction speed, NEAR stands out among many competitors.    

In NEAR Protocol there is a mechanism of segmentation called Nightshade and also a mechanism of block building — Doomslug. Together they can achieve transaction speed up to 100,000. 

In order to achieve consensus, the dPoS mechanism is used. This stands for delegated Proof-of-Stake. To improve performance, sharding is used. But all the shards are perceived as part of a single blockchain, unlike other crypto projects. 

A Rainbow Bridge mechanism allows the use of any information that was cryptographically proven in NEAR, Ethereum contracts and vice versa.  

Doomslag mechanism ensures block generation by validator nodes in the network one by one. New blocks are created every second. 

NEAR Protocol simplifies the developers’ job — they can create applications using familiar languages — Rust and AssemblyScript, as well as Solidity which is used in Ethereum. 

The scalable platform of smart contracts appears to be a whole ecosystem which includes:

  • Writing smart contracts with TypeScript — a typed JavaScript application — or any other language that is compiled into the WASM (Web Assembly)  
  • Horizontal segmented scaling similar to that used by largest companies in the world to work with databases 
  • Consensus using Nightshade, a Byzantine fail-safe algorithm focused on speed, simplicity and security
  • NEAR Wallet giving users an opportunity to confirm low-barrier transactions for entering the staking or, in many cases, even without holding   
  • Instant token transfer between NEAR accounts including tokens from other compatible platforms

All this allows to efficiently work on financial apps of the next generation and gives developers a ready business model for applications. 

In January 2022, NEAR team closed another funding round where they managed to raise $150 000 000 from various investors including Dragonfly Capital and Three Arrows Capital. The NEAR Protocol team also started many partnerships with the major blockchain projects such as Chainlink, Balancer, Ledger, TrustWallet, Ardana and many more. 

The partner of Pantera Capital cryptocurrency hedge fund Paul Veradittakit is convinced that the growth of NEAR will continue this year.

Where did NEAR Protocol (NEAR) come from?

The first concept of the project emerged in 2017 and was formed by Illia Polosukhin and Alexander Skidanov. One had the experience of being a leading contributor for TensorFlow at Google and the other worked as a lead engineer at MemSQL.The first testnet of the project was launched in April 2020, in October that year the official testnet went live.

The NEAR Protocol is created by the NEAR Foundation. It is represented by the community of researchers, developers, and enthusiasts from all over the world. They altogether wrote the first code of the platform and continued the project development. They have been managing all the bugs and updates on the platform since then. Besides, the NEAR Protocol is an open-source project, so anyone can take part in its development.

What are the advantages of NEAR Protocol (NEAR)?

  • Proof-of-Stake mechanism
    PoS enables users to stake and get rewards, as well as enhance the scalability of the project.
  • Nightshade technology
    NEAR Protocol applies the Nightshade technology to boost the throughput capabilities of the cryptocurrency. It also allows cross-chain interoperability.
  • Doomslug
    Doomslug is a novel consensus mechanism that is here to boost efficiency of the performance on the platform. It is responsible for ensuring high-speed transactions and making validators’ work even.

What are the disadvantages of NEAR Protocol (NEAR)?

  • Governance
    Voting is available only for validators at the moment, which leaves other users non-involved in the growth and development process of the project.

How to buy NEAR Protocol (NEAR) on SimpleSwap?

If you want to purchase NEAR coins, SimpleSwap is here to help you. Just follow the simple instructions below to get some coins:

  • For example, you want to swap BTC for NEAR. Select the currency you want to exchange (e.g. BTC) in the first drop-downlist. Then enter the amount you want to swap.
  • Select NEAR in the second drop-down list. You’ll see the estimated amount that you’ll get after the exchange.
  • Click the Exchange button.
  • Enter the Recipient's Address. NEAR will be sent. Be careful and make sure you use the correct address.
  • Create the exchange.
  • You will see the Bitcoin deposit address. You need to transfer the necessary amount of BTC to this address to start the BTC to NEAR exchange.

SimpleSwap reminds you that this article is provided for informational purposes only and does not provide investment advice. All purchases and cryptocurrency investments are your own responsibility.

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