Ever since Phemex was founded in 2019 by Jack Tao and seven other former Morgan Stanley executives, the Singapore-based cryptocurrency exchange has been steadily adding various in-demand tokens to its contract trading platform.
Among the most popular trading pairs recently added to Phemex’s platform is NEAR/USD. The NEAR Protocol is a community-run cloud computing platform designed as a Layer-1 blockchain, running on a certified carbon-neutral proof-of-stake (PoS) network.
The NEAR Protocol has a lot going for it.
For one, it offers 1000x lower transaction fees than prevailing gas fees on Ethereum, which can amount to hundreds of dollars just to create an NFT store.
It also uses “human-readable” account names instead of wallet addresses, making it more user-friendly, and of course, offers solid security assurance.
What are NEAR’s building blocks?
Some of the main features of the NEAR Protocol are:
Consensus – The network uses a Proof-of-Stake consensus mechanism, translating into faster and more efficient transactions. A new block production technique called “Doomslug” is also in the works, which will run in tandem with its “Nightshade” sharding design.
Sharding – Sharding enables the network to split computational tasks into smaller batches, enabling the network to scale its transaction throughput and improve network performance.
Developer Rewards – NEAR developers are incentivized to create new dApps on the platform via an allocation of 30% of transaction fees.
Randomized Selection – Stakers chosen for the validation process are selected in a secure randomized manner which is completely unpredictable.
The secret behind NEAR’s success
NEAR’s competitive advantage lies in its innovative sharding technology, which addresses blockchain’s stubborn problem of scalability. Sharding allows blockchains to split groups of nodes into smaller “chunks” or “shards,” with each shard owning a unique data set. This enables the network to manage an increased load and achieve over 100,000 TPS.
At the same time, one disadvantage of the NEAR Protocol is that a lot of money is required for one to become a validator–one needs to stake over 60,000 NEAR (worth over $1 million USD) in order to secure a “seat” and voting rights.
And because only validators have voting rights, this renders the network less decentralized. There are currently only 73 validators, which means most users on the platform don’t have voting rights.
How NEAR is changing the game for these dApps
In a nascent industry where so much is based on blind hype and digital gold rush, three fast-growing decentralized apps (dApps) are finding clear use cases on the NEAR protocol.
Mintbase – Mintbase enables anyone with zero technical knowledge to mint and sell NFTs such as digital art, music or event tickets, akin to a “Shopify for NFTs,” according to NEAR. However, as it functions via smart contracts, things can get costly. The NEAR Protocol sidesteps this issue with its sharding technology, enabling Mintbase’s users to enjoy much lower gas fees.
Paras – Another NFT marketplace built on the NEAR blockchain, Paras, takes a more curated, selective approach to building an NFT community, enabling truly promising artists to shine. Transactions are fast (1 to 2 seconds) and budget-friendly at just a few cents or less.
Flux – Flux is an open-data protocol that lets developers create markets on anything, from assets to commodities and real-world events. Besides benefitting from NEAR’s low gas fees, it also uses the NEAR Wallet, which functions as a browser extension, to display account names instead of wallet addresses, resulting in a more frictionless experience.
NEAR’s investment outlook
The NEAR Protocol looks set to open the floodgates for the monetization of applications like never before. At the Paris Blockchain Week Summit in April 2022, it announced a partnership with Sweatcoin, an app that rewards users for walking.
Developments in the works include changes to requirements for running of nodes, enabling even mobile users to participate–this will contribute to long-term security and stability. The platform also wants to enhance its privacy by preventing transactions from being tracked, and by introducing ‘private shards’ which will allow a group of users to run their own private chain.
It also recently launched the “NEAR Regional Hub” in Kenya to grow awareness and adoption of blockchain technology.
With clear use cases, commitment to overall industry growth and on-going developments, NEAR is definitely one of the more promising protocols to keep an eye on. Its addition to the Phemex contract trading platform is well-justified, as the exchange is well-known for being extremely cautious about its listings.
The NEAR protocol was built to make building on blockchain affordable and user-friendly for everyone, and this aligns perfectly with Phemex’s goals—to remove the barriers of investment for the man on the street.
To celebrate its newest listings, Phemex is also hosting the Nearing the Future Campaign with a prize pool up to $100,000. Trade today with Phemex.
Disclaimer: There is no offer to sell, no solicitation of an offer to buy, and no recommendation of any security or any other product or service in this article. The information provided in this release is not investment advice, financial advice or trading advice. All readers are encouraged to do their own research.
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