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Why NEAR Protocol?
A high performing L1 blockchain with an emerging, vibrant ecosystem and a war chest to attract developers and founders.
Welcome to the Alpha Please newsletter. We curate alpha for you. That’s it; that’s the newsletter.
alpha please has been monitoring NEAR for a while and we picked it to have a great 2022.
As always, we are going to try and blitz our way through this massive topic, but hopefully this gives you the foundation and fomo needed to dig deeper into NEAR.
What is NEAR?
NEAR describe themselves as “a collective, a foundation, and a development platform built on a new layer-one blockchain.”
It is being built by the NEAR Collective, a worldwide community of researchers, developers, and thinkers, who wrote the initial code for the NEAR Protocol and continue to support the project by releasing bug fixes, updates, and building out the surrounding NEAR ecosystem. Since the code for NEAR is open source, anybody can join the collectible and begin contributing towards its development.
What is the NEAR Protocol?
NEAR is a base layer blockchain, also commonly referred to as a layer-one, and a Proof-of-Stake protocol. NEAR’s PoS works by a voting mechanism: once a validator is chosen, they then work on solving the block.
Why build on NEAR? In their words:
NEAR allows developers to just deploy their app without thinking too much about how the infrastructure around it operates or scales, which is more like the modern clouds like Amazon AWS or GCP or Azure which drive almost all of today’s web applications.
NEAR was meant to be a sharded blockchain from the start. In this approach instead of running one blockchain, multiple blockchains called shards run in parallel.
NEAR uses a technology they call Simple Nightshade to achieve its massive throughput capabilities.
What Makes Simple Nightshade Unique?
Firstly, what’s a quick TL;DR on sharding? Think of a blockchain protocol as being composed of multiple other blockchains. Each of these component blockchains is called a “shard,” and each has their own set of validators.
NEAR’s Simple Nightshade system is modelled as a single blockchain, with each block containing all transactions from all shards. As a consequence, each block changes the entire state of all shards.
The Simple Nightshade approach is unique in that each block contains all transactions from all shards. No participant downloads either the full state or the full logical block — instead, they maintain the state connected to the shards for which they validate transactions.
Near have built a mechanism to split a shard into multiple parts through live upgrades, which will serve as the foundation for dynamic resharding in the future. Meanwhile, because every shard is still validated by all validators, the safety guarantees remain the same.
On a practical level, this significantly speeds up transactions (TPS, or transactions per second) and enhances security both for the community and any cross-platform or multi-chain projects.
Though Simple Nightshade’s launch is only the first of several steps toward a fully-sharded, truly agile NEAR, its impact on DeFi and Crypto in Phase 0 is immediate and potent.
In phase 3 (dynamic resharding), NEAR want to expand on that and create the ability for the network to dynamically split and merge shards based on resource utilization. In their words, this will make NEAR almost infinitely scalable and resilient to short-term usage spikes. They expect to deliver phase 3 in Q4 2022.
The full explainer on the Simple Nightshade Sharding roadmap is here.
John Wang with an excellent and thorough write up.
If polynya respects the tech, then you can be sure that NEAR has a great chance of finding its place in this multi-chain world. Polynya adds a bit more colour to John’s thread.
What is Aurora?
Aurora is an Ethereum Virtual Machine created by the team at the NEAR Protocol. It delivers a turn-key solution for developers to operate their apps on an Ethereum-compatible, high-throughput, scalable and future-safe platform, with low transaction costs for their users.
In a nutshell:
Here is how the NEAR founder sees Aurora:
How to become a bridgeooooor:
NEAR’s Ecosystem Fund
Yes, NEAR is a newer L1 and I can hear some people in the back of the room shouting, “but they are too far behind”. Well, NEAR may have an answer to this bit of fud. NEAR has a very large war chest to incentivise developers and start ups to build on their protocol.
3AC also just led another big raise for the NEAR foundation. Major crypto focused funds all wanted a piece of the action: Mechanism Capital, Dragonfly Capital, Andreessen Horowitz (a16z), Jump, Alameda, Zee Prime and Amber Group, among others. Probably nothing?
Assorted CT Commentary
The Defi scene is starting to blossom on NEAR.
This anon has gone all in.
Sell me NEAR in one tweet.
The founder of NEAR speaks alongside the founders of SOL and AVAX.
NEAR transactions are demonstrating solid growth.
NEAR is still not on Coinbase.
NEAR has a growing NFT scene.
More NEAR NFT alpha.
Missed early ETH NFTs, missed early SOL NFTs… another chance to be early?
Gaming is another vertical that is gaining traction on NEAR.
OP Games is currently building on NEAR. They work directly with game developers to turn their games into fractionalised NFTs that are then offered to the community. Players in turn can discover new HTML5 games on OP Arcade, play, compete in tournaments and buy NFTs thus becoming stakeholders.
OP Games raised $8.6 million to help game developers transition to Web3.
Hash Rush is considered by many to be one of the best, most innovative emerging games in the NEAR ecosystem.
There are a ton more builders developing games on NEAR and far too many to mention, but Near Lands is another intriguing project. It is a multiplayer 2D world running on NEAR, which other developers can build on. Holistic pilgrim is an example. Stardew Valley vibes.
What’s the TA saying?
A few perspectives to help you get an entry, should you so desire one.
Sherpa is a regular watcher of the NEAR meme lines.
Livercoin is short term bullish.
Short term levels to hold for continuation.
An idea from Gregariou$.
What’s the Catch?
There are always tradeoffs, anon.
Bizdev concerns from Hasu back in September.
And that’s your alpha.
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Not financial or tax advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Do your own research.