High hopes for the adoption of Bitcoin as legal tender in El Salvador left the market stunned by a recent major correction. Despite the overall market crash, one major project stood out – NEAR Protocol grew over 40 percent throughout the crash. The sudden rise in value brought NEAR to 38th by market cap, drastically increasing their standing. While the price has fluctuated and declined since it remains up significantly from the previous valuation before September.
NEAR is one of many coins competing to overtake Ethereum as the prime location for blockchain-based decentralized applications. A recent backend update went live before the crash and maybe the cause of the spike in value was witnessed. The market itself seemed to stabilize after the initial drop, which may aid NEAR in maintaining its high valuation. As decentralized application adoption ramps up across the board, NEAR’s platform may continue to ride the wave higher.
What is the NEAR Protocol?
The NEAR Protocol is a platform for decentralized applications that uses the ‘sharding’ technique. Sharding allows the blockchain to run parallel validations, allowing for considerably faster transaction speed without an associated drop in security or decentralization. As with most ‘Ethereum Killer’ style platforms, NEAR offers exponentially more efficient transactions than the Ethereum blockchain.
NEAR also allows direct integration of Ethereum projects through their trustless EVM bridge. The bridge allows developers to easily create cross-chain projects, as well as transferring projects built on Ethereum over to the NEAR blockchain. NEAR recently launched “NearPad,” a DeFi platform for launching decentralized projects in the NEAR ecosystem. NearPad raised $2M in seed funding.
Is Ethereum Falling Behind?
Just as Bitcoin faces a constant deluge of new ‘digital currency’ competitors, Ethereum must fend off a variety of smart contract platforms. However, while BTC maintains a high value – and doesn’t need to accomplish much else – Ethereum must prove themselves the better platform or risk losing out to one of these start-ups. NEAR’s recent performance despite the market downturn makes them one of several top competitors.
While the Ethereum Foundation continues to update ETH, its pace is slower than expected. The near-mythical switch to proof-of-stake would help Ethereum catch up to these start-ups. Yet, for now, Ethereum fees remain prohibitive and allow for slow chipping away of Ethereum’s market share.