NEAR protocol was founded in 2018 by Illia Polosukhin and Alexander Skindanov. Illia holds a master in computer science and spent most of his earlier career working as a software engineer for various tech companies including Google where he focused on machine learning technology that is now used as part of Google translate. Alexander holds a master in computer science and spent of his earlier career working at MemSQL where he served as director of engineering for over 3 years.
Illia and Alexander met up through the famous Y Combinator start-up and founded NEAR protocol which began as an AI focus project in 2017. After both of them had difficulty making payments for their staff overseas, they decided to turn NEAR protocol into a crypto project that would focus on payment and decentralized applications inspired in part by Ethereum and other smart contract cryptocurrencies.
NEAR protocol was built by NEAR incorporated a software company based in San Fransisco California. NEAR protocol development is coordinated by NEAR Foundation, a non-profit organization based in Switzerland.
In technical terms, NEAR is a layer one, sharded, proof-of-stake blockchain built with usability in mind.
NEAR is a simple, scalable, and secure blockchain platform designed to provide the best possible experience for developers and users, which is necessary to bridge the gap to the mainstream adoption of decentralized applications. NEAR is a blockchain for everyone.
NEAR is a user-friendly and carbon-neutral blockchain, built from the ground up to be performant, secure, and infinitely scalable. NEAR is completely carbon neutral and certified.
Unlike other blockchains, this network has been built from the ground up to be the easiest in the world for both developers and their end-users while still providing the scalability necessary to serve those users. Specifically, NEAR is designed to make it easier to:
Build decentralized applications, even if you're only used to building with "traditional" web or app concepts.
Onboard users with a smooth experience, even if they have never used crypto, tokens, keys, wallets, or other blockchain artifacts.
Scale your application seamlessly - the underlying platform automatically expands capacity via sharding without additional costs or effort on your part.
NEAR is the native token of the NEAR blockchain. It has a variety of use cases:
Securing the Network
NEAR Protocol is a proof-of-stake (PoS) network, which means that resistance from various attacks comes from staking NEAR. Staked NEAR represents the decentralized infrastructure of servers that maintain the network and process transactions for applications and users on NEAR. Rewards for providing this service are received in NEAR.
Providing a Unit of Account
NEAR is used to price computation and storage on the NEAR infrastructure. The network charges transaction fees in NEAR to process changes and transactions.
Medium of Exchange
NEAR is readily available on the protocol level, so it can be used to transfer value between NEAR applications and accounts. This means that applications can use NEAR to charge for various functions, like access to data or other complex transactions. Entities can also easily exchange NEAR between each other, without the need for trusted third parties to clear and settle transactions.
The following will help you better contextualize the sections below:
Genesis Tokens: There were 1 billion NEAR tokens created at genesis. They are being allocated to individuals and organizations on an ongoing basis during the rollout of MainNet. Inflation, transfers and unlocking did not begin until the final phase of MainNet (“Phase II”), which started on October 13, 2020. All charts in this post began on the date when transfers were enabled (which will be determined by the community). See below for the circulating supply.
Contract-Based Accounts: NEAR uses a smart-contract-based account model, meaning that each account is actually a smart contract as well. Account names are thus human-readable (eg `foobar.near`) and contain any number of uniquely-permissioned keys. Thus it’s possible to have staking keys separate from transfer keys.
Transfer Restriction: Until the network officially reached the Community-Governed MainNet phase (aka “Phase II”), the accounts of token recipients were prevented from directly transferring tokens (but they could still be used to pay for gas or storage, staked, delegated, used to deploy apps, etc).
Lockups and Unlocking: Most tokens are subject to linearly releasing lockups. These lockups are implemented as contract-based locks atop various accounts. Lockups are generally implemented in a linear, per-block fashion instead of in monthly chunks, though some might be implemented that way as well. Lockups begin unlocking when the transition to the final Community-Governed MainNet phase occurs (aka “Phase II”). We use the term “linear lockup” or “linear release” whereas some other projects use the term “vesting”, so you may know it by that name.
Staking and Delegating while Locked: NEAR is a Proof of Stake network where validating nodes put at stake either their own tokens or tokens which have been “delegated” to them by other holders. The number of validating nodes depends on the number of shards in the network but will start at 100. Because of NEAR’s account model, tokens can be staked or delegated even while they are locked.
Foundation Delegation: The Foundation is only actively running nodes during the initial phase of the network rollout. Thereafter, it will shut down its nodes and be limited to delegation. It will only delegate tokens in its endowment.
New Issuance and Economics: As per the Economics Blog Post and Economics Paper, 5% of additional supply is issued each year to support the network as epoch rewards, of which 90% goes to validators (4.5% total) and 10% to the protocol treasury (0.5% total). 30% of transaction fees are rebated to the contracts touched by the transaction and 70% are burned. Because of this burning, at high levels of transaction throughput, the network could become deflationary. In this post, we assume the pessimistic case of 0 fees. New supply creation does not begin until the transition to the final Community-Governed MainNet phase occurs.
The total supply of NEAR is 1 billion tokens, according to the following token distribution:
17.2% - Community Grants
11.4% - Operation Grants
10% - Foundation Endowment
11.7% - Early Ecosystem
14% - Core Contributors
17.6% - Backers
6.1% - Small Backers
12% - Community Sale
NEAR Protocol launched its mainnet on April 22, 2020 with 1 billion NEAR tokens created at genesis. 5% of additional supply is issued each year to support the network as epoch rewards, of which 90% goes to validators (4.5% total) and 10% to the protocol treasury (0.5% total). 30% of transaction fees are paid out as rebates to contracts that interact with a transaction, while the remaining 70% are burned.
In simple the NEAR token is used for:
Fees for processing transactions and storing data.
Running validator nodes on the network via staking NEAR tokens.
Used for governance votes to determine how network resources are allocated.
NEAR tokens can be purchased through several exchanges as below:
1. Binance Exchange - you can purchase NEAR on Binance using your mobile phone or desktop. You only need to follow the step as instructed. You can also receive a 25% discount on trading fees using Binance Coin (BNB) instead of cash. Use the link above for a bonus 10% discount.
2. FTX - Trade Bitcoin, Doge, and other cryptos with zero fees on FTX. Use referral code “24Boston” or use the link above and get a free coin when you trade $10 worth of coins
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