What is NEAR Protocol? A Comprehensive Guide

By: crypto insight|2025/08/20 22:10:02

Key Takeaways

NEAR Protocol is a scalable, layer-1 blockchain platform designed to make decentralized applications (dApps) more accessible and user-friendly, using innovative sharding technology to handle high transaction volumes without sacrificing speed or cost.
Its native token, NEAR, powers the ecosystem by facilitating staking, governance, and transaction fees, while enabling developers to build and deploy apps with low barriers, much like how smartphones democratized app development.
Key advantages include low fees, fast transaction speeds (up to 100,000 TPS through sharding), and a focus on usability, making it ideal for Web3 adoption in gaming, DeFi, and social apps.
NEAR emphasizes community-driven growth with tools like the NEAR Wallet and BOS (Blockchain Operating System), positioning it as a bridge between traditional web users and blockchain tech.
While it offers strong security via proof-of-stake, users should be aware of risks like market volatility and the evolving regulatory landscape in crypto.

What Is NEAR Protocol?

NEAR Protocol is a community-operated cloud platform for building and deploying decentralized applications, leveraging sharding to achieve high scalability and low costs, making it easier for developers and users to engage with blockchain technology without the typical complexities.

Imagine trying to build a house on a crowded plot of land where everyone’s competing for space—that’s kind of like older blockchains struggling with congestion. NEAR Protocol flips the script by dividing the “land” into smaller, manageable shards, allowing everything to run smoother and faster. Launched in 2020, NEAR emerged from a vision to make blockchain as intuitive as the web we’re used to. Its origins trace back to the need for a more developer-friendly alternative to platforms like Ethereum, where high gas fees and slow speeds can feel like roadblocks. The core concept revolves around “usability first,” blending advanced tech with simple tools to onboard the next billion users into crypto. The ecosystem includes the NEAR token for transactions, a robust set of dApps in areas like DeFi and NFTs, and partnerships that expand its reach. Founded by a team with AI and engineering chops, it’s backed by heavyweights in the tech world, fostering an environment where innovation thrives without the usual headaches.

Origins and Background

NEAR didn’t just pop up overnight; it was born from frustrations with existing blockchains. Back in 2018, as Ethereum was hitting its limits during the ICO boom, the founders saw an opportunity to create something better. The platform went live on mainnet in October 2020, quickly gaining traction for its focus on real-world adoption.

Founding Team and Proponents

The brains behind NEAR include Alex Skidanov, a former Microsoft engineer, and Illia Polosukhin, who co-created the Transformer model that’s foundational to modern AI like ChatGPT. Their expertise in scalable systems and machine learning informs NEAR’s design, emphasizing efficiency. The project has attracted support from investors like Andreessen Horowitz and Pantera Capital, adding credibility and resources.

Core Concept of NEAR Protocol

At its heart, NEAR is about sharding—splitting the blockchain into parallel chains to process more transactions. This isn’t just tech jargon; it means you can send money or run apps without waiting forever or paying an arm and a leg. The ecosystem ties into this with user-owned data and seamless integrations, like logging in with a simple email instead of managing complex keys.

The NEAR Ecosystem Overview

Think of the NEAR ecosystem as a bustling city: the Blockchain Operating System (BOS) is the infrastructure, dApps are the buildings, and tokens like NEAR fuel the economy. It supports everything from decentralized finance platforms to social networks, with tools that let developers code in familiar languages like JavaScript. Growth has been steady, with over 100 million accounts created by mid-2025, showing its appeal beyond crypto enthusiasts.

FAQs on NEAR Basics

What makes NEAR different from other blockchains?
NEAR uses Nightshade sharding to scale horizontally, unlike Ethereum’s layer-2 solutions, which can add complexity.

Is NEAR beginner-friendly?
Absolutely—its wallet uses human-readable accounts, so no more memorizing hex strings.

Who Created NEAR Protocol?

NEAR Protocol was spearheaded by a duo with deep roots in tech innovation. Alex Skidanov, with his background at Microsoft and MemSQL, brought expertise in distributed systems. Illia Polosukhin, known for his work on AI at Google, contributed insights into scalable computing. Together, they founded NEAR Collective in 2018, aiming to solve blockchain’s usability issues. The project originated from their experiences in the AI space, where they saw parallels in needing efficient, decentralized computation.

The whitepaper, released in 2019, outlined NEAR’s sharding approach and proof-of-stake consensus, emphasizing low-latency and high-throughput. Key milestones include the testnet launch in 2019, mainnet in 2020, and the introduction of Rainbow Bridge for Ethereum interoperability in 2021. By 2022, NEAR hit 1 million daily transactions during a gaming boom, and in 2023, it integrated with major wallets like Ledger for enhanced security. Fast forward to 2025, and NEAR has expanded with Chain Abstraction, making multi-chain interactions feel seamless—like switching apps on your phone without noticing the backend.

The team has grown to include engineers from Facebook and Google, fostering a collaborative environment. Historical hiccups, like a brief network halt in 2021 due to a bug, were quickly resolved, building trust. It’s like that friend who stumbles but always gets back up stronger.

Background on Founders

Skidanov and Polosukhin aren’t your typical crypto bros; they’re problem-solvers from the tech trenches. Their AI background influenced NEAR’s focus on developer tools, making it easier to build without a PhD in cryptography.

Project Origins and Whitepaper

Born in San Francisco’s startup scene, the whitepaper detailed a “thresholded proof-of-stake” system, designed for security without energy waste.

Historical Milestones

From genesis block to global adoption, milestones like the 2024 partnership with major brands for NFT drops highlight NEAR’s evolution.

How Does NEAR Protocol Work?

NEAR operates on a sharded proof-of-stake blockchain, where the network is divided into shards to process transactions in parallel, boosting speed and reducing costs. At its core, it’s like a super-efficient assembly line: instead of one worker handling everything, multiple teams work simultaneously.

The consensus mechanism, called Doomslug, combines elements of BFT (Byzantine Fault Tolerance) with staking, where validators lock up NEAR tokens to secure the network and earn rewards. Smart contracts on NEAR are written in Rust or AssemblyScript, deployed via the NEAR CLI, and executed in a WebAssembly environment for security. Private keys manage user accounts, while public keys verify transactions—think of it as your digital lock and key.

Ever wondered why some blockchains feel sluggish? NEAR’s Nightshade sharding dynamically adjusts shards based on load, aiming for 100,000 TPS. Transactions are near-instant, with finality in about 1-2 seconds, powered by a network of validators elected through staking.

Blockchain and Consensus Mechanisms

NEAR uses proof-of-stake, where stakers “vote” on blocks, avoiding the energy hog of proof-of-work.

Smart Contracts and Technical Principles

Contracts are like automated agreements; NEAR makes them gas-efficient, so running a DeFi app doesn’t break the bank.

Private and Public Keys Explained

Your private key is your secret password—lose it, and you’re locked out. Public keys are shareable for receiving funds safely.

FAQs on NEAR’s Mechanics

How secure is NEAR’s consensus?
It’s designed to withstand attacks, with over 33% of staked tokens needed to compromise it—pretty robust!

Can I run a node on NEAR?
Yes, with modest hardware, making it more accessible than some chains.

How Is New NEAR Created?

New NEAR tokens are minted through a proof-of-stake mechanism where validators and delegators stake existing tokens to secure the network and earn rewards. There’s no mining like Bitcoin; instead, it’s all about staking. The total supply is capped at 1 billion NEAR, with an inflation model that adds about 5% annually to reward stakers, but unused gas fees are burned to counterbalance this.

Staking works by locking NEAR in a contract—validators run nodes, and anyone can delegate to them for a share of rewards. Rewards are distributed per epoch (about 12 hours), based on stake amount and network participation. It’s like earning interest on a savings account, but with the added thrill of supporting the blockchain. The model encourages long-term holding, with a 1% fee on rewards going to the protocol treasury for development.

Issuance Method and Staking

Tokens are issued as staking rewards, not pre-mined en masse.

Inflation Model and Total Supply

With 1 billion max, inflation keeps the economy humming without diluting value endlessly.

Reward Mechanisms

Earn up to 10% APY by staking—better than most banks, right?

What Are the Use Cases of NEAR Protocol?

NEAR shines in scenarios where speed and cost matter, like DeFi lending platforms where users borrow without banks, or NFT marketplaces for digital art sales. It’s great for payments, enabling micro-transactions in games without fees eating profits. In governance, NEAR holders vote on proposals via DAO tools, giving the community a real say.

Cross-border transfers? NEAR’s low fees make it a contender against pricey wires. Smart contracts power automated insurance or yield farming in DeFi. Think of social apps on NEAR, where users own their data—no more tech giants harvesting your info. It’s even dipping into enterprise, with partnerships for supply chain tracking.

Payments and Value Storage

Store value like digital gold, or send remittances instantly.

DeFi and Smart Contracts

Build lending apps or DEXes with ease.

NFTs, Governance, and More

From minting art to voting on upgrades, NEAR covers it.

Everyday Example

Picture buying coffee with crypto—NEAR makes it fast enough to not hold up the line.

How Can You Buy, Send, or Store NEAR Protocol?

Getting started with NEAR is straightforward. Buy it on exchanges like WEEX, where you can trade spot or futures. For sending, use the NEAR Wallet app: enter the recipient’s address, confirm, and it’s done in seconds. Storage? Hot wallets like the official NEAR one are convenient for daily use, while cold wallets like Ledger offer top security for long-term holds. Always enable 2FA and back up your seed phrase—losing it is like misplacing your house keys forever.

WEEX Exchange is a trusted spot for trading NEAR, with low fees and high liquidity. New users can register to snag a free 20 USDT bonus, making it a smart entry point into crypto. It’s user-friendly, perfect for beginners dipping their toes.

https://www.weex.com/how-to-buy

Purchasing Channels

Exchanges, OTC desks—WEEX stands out for its bonuses.

Wallet Types and Security

Hot for quick access, cold for safety.

Common Operations

Scan a QR, hit send—easy as texting money.

FAQs on Handling NEAR

What’s the safest way to store NEAR?
A hardware wallet, away from online threats.

How do I avoid fees when sending?
Use NEAR’s low-gas network; it’s pennies per tx.

Pros & Cons / Risks

Pros: High scalability with sharding for fast, cheap transactions; user-friendly design lowers entry barriers; strong focus on developer tools boosts innovation; proof-of-stake is eco-friendly; growing ecosystem with real-world partnerships.
Cons/Risks: Market volatility can swing prices wildly; regulatory uncertainties in crypto could impact adoption; technical risks like bugs in sharding; competition from established chains; dependence on staking participation for security.

Ever chased a “sure thing” in stocks only to watch it dip? Crypto’s the same—exciting, but pack your risk tolerance.

Comparison

NEAR vs. Ethereum: While Ethereum pioneered smart contracts, it’s often bogged down by high fees—NEAR’s sharding gives it an edge in speed, like a sports car vs. a reliable sedan. Against Solana, NEAR emphasizes usability over raw TPS, with better decentralization. Positioning? NEAR is the “people’s blockchain,” aiming for mass adoption where others focus on enterprise.

Market & Ecosystem

As of 2025-08-20 14:04:10, NEAR’s market is vibrant, reflecting its push for Web3 accessibility.

Market Cap & Trading Volume

NEAR boasts a market cap in the billions, with daily trading volume often exceeding $500 million, driven by DeFi and gaming surges.

Exchanges Where It’s Listed

Available on major platforms like Binance, Coinbase, and WEEX for seamless trading.

Community Size & Activity

With over 1 million Twitter followers, active Reddit discussions (r/nearprotocol), and bustling Telegram groups, the community is engaged—think daily AMAs and hackathons.

Ecosystem Growth: Partnerships and Developer Activity

Partnerships with Google Cloud and Circle expand its reach; developer activity is high, with thousands building on BOS, fueling dApp growth.

What’s the Latest News of NEAR Protocol?

(Note: Based on the provided summaries, no news directly pertained to NEAR Protocol as of the extraction time. For the most current updates, check official channels.)

Conclusion / Next Steps

NEAR Protocol’s blend of scalability and usability points to a bright future, potentially powering the next wave of Web3 apps as adoption grows. Dive deeper by reading the whitepaper on near.org or checking the roadmap for upcoming features like enhanced AI integrations. Join the community on Discord to chat with developers, or start small by staking some NEAR—it’s a hands-on way to learn. Who knows, you might just build the next big dApp over your morning coffee.

Editor's Note: Citrini7's cyberpunk-themed AI doomsday prophecy has sparked widespread discussion across the internet. However, this article presents a more pragmatic counter perspective. If Citrini envisions a digital tsunami instantly engulfing civilization, this author sees the resilient resistance of the human bureaucratic system, the profoundly flawed existing software ecosystem, and the long-overlooked cornerstone of heavy industry. This is a frontal clash between Silicon Valley fantasy and the iron law of reality, reminding us that the singularity may come, but it will never happen overnight.

The following is the original content:

Renowned market commentator Citrini7 recently published a captivating and widely circulated AI doomsday novel. While he acknowledges that the probability of some scenes occurring is extremely low, as someone who has witnessed multiple economic collapse prophecies, I want to challenge his views and present a more deterministic and optimistic future.

Never Underestimate "Institutional Inertia"

In 2007, people thought that against the backdrop of "peak oil," the United States' geopolitical status had come to an end; in 2008, they believed the dollar system was on the brink of collapse; in 2014, everyone thought AMD and NVIDIA were done for. Then ChatGPT emerged, and people thought Google was toast... Yet every time, existing institutions with deep-rooted inertia have proven to be far more resilient than onlookers imagined.

When Citrini talks about the fear of institutional turnover and rapid workforce displacement, he writes, "Even in fields we think rely on interpersonal relationships, cracks are showing. Take the real estate industry, where buyers have tolerated 5%-6% commissions for decades due to the information asymmetry between brokers and consumers..."

Seeing this, I couldn't help but chuckle. People have been proclaiming the "death of real estate agents" for 20 years now! This hardly requires any superintelligence; with Zillow, Redfin, or Opendoor, it's enough. But this example precisely proves the opposite of Citrini's view: although this workforce has long been deemed obsolete in the eyes of most, due to market inertia and regulatory capture, real estate agents' vitality is more tenacious than anyone's expectations a decade ago.

A few months ago, I just bought a house. The transaction process mandated that we hire a real estate agent, with lofty justifications. My buyer's agent made about $50,000 in this transaction, while his actual work — filling out forms and coordinating between multiple parties — amounted to no more than 10 hours, something I could have easily handled myself. The market will eventually move towards efficiency, providing fair pricing for labor, but this will be a long process.

I deeply understand the ways of inertia and change management: I once founded and sold a company whose core business was driving insurance brokerages from "manual service" to "software-driven." The iron rule I learned is: human societies in the real world are extremely complex, and things always take longer than you imagine — even when you account for this rule. This doesn't mean that the world won't undergo drastic changes, but rather that change will be more gradual, allowing us time to respond and adapt.

The Software Industry Has "Infinite Demand" for Labor

Recently, the software sector has seen a downturn as investors worry about the lack of moats in the backend systems of companies like Monday, Salesforce, Asana, making them easily replicable. Citrini and others believe that AI programming heralds the end of SaaS companies: one, products become homogenized, with zero profits, and two, jobs disappear.

But everyone overlooks one thing: the current state of these software products is simply terrible.

I'm qualified to say this because I've spent hundreds of thousands of dollars on Salesforce and Monday. Indeed, AI can enable competitors to replicate these products, but more importantly, AI can enable competitors to build better products. Stock price declines are not surprising: an industry relying on long-term lock-ins, lacking competitiveness, and filled with low-quality legacy incumbents is finally facing competition again.

From a broader perspective, almost all existing software is garbage, which is an undeniable fact. Every tool I've paid for is riddled with bugs; some software is so bad that I can't even pay for it (I've been unable to use Citibank's online transfer for the past three years); most web apps can't even get mobile and desktop responsiveness right; not a single product can fully deliver what you want. Silicon Valley darlings like Stripe and Linear only garner massive followings because they are not as disgustingly unusable as their competitors. If you ask a seasoned engineer, "Show me a truly perfect piece of software," all you'll get is prolonged silence and blank stares.

Here lies a profound truth: even as we approach a "software singularity," the human demand for software labor is nearly infinite. It's well known that the final few percentage points of perfection often require the most work. By this standard, almost every software product has at least a 100x improvement in complexity and features before reaching demand saturation.

I believe that most commentators who claim that the software industry is on the brink of extinction lack an intuitive understanding of software development. The software industry has been around for 50 years, and despite tremendous progress, it is always in a state of "not enough." As a programmer in 2020, my productivity matches that of hundreds of people in 1970, which is incredibly impressive leverage. However, there is still significant room for improvement. People underestimate the "Jevons Paradox": Efficiency improvements often lead to explosive growth in overall demand.

This does not mean that software engineering is an invincible job, but the industry's ability to absorb labor and its inertia far exceed imagination. The saturation process will be very slow, giving us enough time to adapt.

Redemption of "Reindustrialization"

Of course, labor reallocation is inevitable, such as in the driving sector. As Citrini pointed out, many white-collar jobs will experience disruptions. For positions like real estate brokers that have long lost tangible value and rely solely on momentum for income, AI may be the final straw.

But our lifesaver lies in the fact that the United States has almost infinite potential and demand for reindustrialization. You may have heard of "reshoring," but it goes far beyond that. We have essentially lost the ability to manufacture the core building blocks of modern life: batteries, motors, small-scale semiconductors—the entire electricity supply chain is almost entirely dependent on overseas sources. What if there is a military conflict? What's even worse, did you know that China produces 90% of the world's synthetic ammonia? Once the supply is cut off, we can't even produce fertilizer and will face famine.

As long as you look to the physical world, you will find endless job opportunities that will benefit the country, create employment, and build essential infrastructure, all of which can receive bipartisan political support.

We have seen the economic and political winds shifting in this direction—discussions on reshoring, deep tech, and "American vitality." My prediction is that when AI impacts the white-collar sector, the path of least political resistance will be to fund large-scale reindustrialization, absorbing labor through a "giant employment project." Fortunately, the physical world does not have a "singularity"; it is constrained by friction.

We will rebuild bridges and roads. People will find that seeing tangible labor results is more fulfilling than spinning in the digital abstract world. The Salesforce senior product manager who lost a $180,000 salary may find a new job at the "California Seawater Desalination Plant" to end the 25-year drought. These facilities not only need to be built but also pursued with excellence and require long-term maintenance. As long as we are willing, the "Jevons Paradox" also applies to the physical world.

Towards Abundance

The goal of large-scale industrial engineering is abundance. The United States will once again achieve self-sufficiency, enabling large-scale, low-cost production. Moving beyond material scarcity is crucial: in the long run, if we do indeed lose a significant portion of white-collar jobs to AI, we must be able to maintain a high quality of life for the public. And as AI drives profit margins to zero, consumer goods will become extremely affordable, automatically fulfilling this objective.

My view is that different sectors of the economy will "take off" at different speeds, and the transformation in almost all areas will be slower than Citrini anticipates. To be clear, I am extremely bullish on AI and foresee a day when my own labor will be obsolete. But this will take time, and time gives us the opportunity to devise sound strategies.

At this point, preventing the kind of market collapse Citrini imagines is actually not difficult. The U.S. government's performance during the pandemic has demonstrated its proactive and decisive crisis response. If necessary, massive stimulus policies will quickly intervene. Although I am somewhat displeased by its inefficiency, that is not the focus. The focus is on safeguarding material prosperity in people's lives—a universal well-being that gives legitimacy to a nation and upholds the social contract, rather than stubbornly adhering to past accounting metrics or economic dogma.

If we can maintain sharpness and responsiveness in this slow but sure technological transformation, we will eventually emerge unscathed.

Source: Original Post Link

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