{"id":11132,"date":"2023-01-19T00:11:52","date_gmt":"2023-01-19T00:11:52","guid":{"rendered":"https:\/\/www.bitnovo.com\/blog\/?p=11132"},"modified":"2025-09-10T15:21:16","modified_gmt":"2025-09-10T15:21:16","slug":"near-protocol-what-is-it-and-how-does-it-work","status":"publish","type":"post","link":"https:\/\/www.bitnovo.com\/blog\/en\/near-protocol-what-is-it-and-how-does-it-work","title":{"rendered":"NEAR Protocol: What is it and how does it work?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-transparent ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Alternar tabla de contenidos\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #ffffff;color:#ffffff\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #ffffff;color:#ffffff\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.bitnovo.com\/blog\/en\/near-protocol-what-is-it-and-how-does-it-work\/#what_is_near_protocol\" >What is NEAR Protocol?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.bitnovo.com\/blog\/en\/near-protocol-what-is-it-and-how-does-it-work\/#the_near_protocol_blockchain\" >The NEAR Protocol blockchain<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.bitnovo.com\/blog\/en\/near-protocol-what-is-it-and-how-does-it-work\/#structure\" >Structure<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.bitnovo.com\/blog\/en\/near-protocol-what-is-it-and-how-does-it-work\/#consensus\" >Consensus<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.bitnovo.com\/blog\/en\/near-protocol-what-is-it-and-how-does-it-work\/#near_cryptocurrency\" >NEAR cryptocurrency\u00a0<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.bitnovo.com\/blog\/en\/near-protocol-what-is-it-and-how-does-it-work\/#utility\" >Utility<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.bitnovo.com\/blog\/en\/near-protocol-what-is-it-and-how-does-it-work\/#near_and_its_numbers\" >NEAR and its numbers<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.bitnovo.com\/blog\/en\/near-protocol-what-is-it-and-how-does-it-work\/#near_protocol_and_its_platform\" >NEAR Protocol and its platform<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/www.bitnovo.com\/blog\/en\/near-protocol-what-is-it-and-how-does-it-work\/#final_considerations\" >Final considerations<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<span class=\"span-reading-time rt-reading-time\" style=\"display: block;\"><span class=\"rt-label rt-prefix\">Tiempo de lectura:<\/span> <span class=\"rt-time\"> 5<\/span> <span class=\"rt-label rt-postfix\">minutos<\/span><\/span><p>To talk about \u201c<strong>cryptos<\/strong>\u201d nowadays is to talk about a topic that is practically installed in the mainstream of our society. It is difficult to find people who, far from being experts, have never heard a word about this subject of \u201ccryptos\u201d.<\/p>\n<p>This broad exposure, beyond the essential work of communicators and communicators, lies in the enormous amount of programming development that lies behind this world.<\/p>\n<p>Today I will give place to\u00a0<strong>NEAR Protocol, a project focused on giving tools<\/strong>\u00a0to these revered actors of our ecosystem,\u00a0<strong>the developers<\/strong>, to facilitate their task and continue to attract new users to this constantly evolving world.<\/p>\n<p>&nbsp;<\/p>\n<h2><span class=\"ez-toc-section\" id=\"what_is_near_protocol\"><\/span><strong>What is NEAR Protocol?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>To begin to understand this ambitious project, it is necessary to understand that it consists of three parts, which I will list below:<\/p>\n<ol>\n<li>On the one hand,\u00a0<strong>we have the NEAR blockchain,<\/strong>\u00a0with a good level of decentralization, a\u00a0<a href=\"https:\/\/www.bitnovo.com\/blog\/en\/what-is-proof-of-stake-and-how-does-it-work\/\">proof of stake<\/a>\u00a0consensus and written in a widely used programming language such as\u00a0<strong>Web Assembly<\/strong>.<\/li>\n<li>On the other hand, we have\u00a0<strong>NEAR Platform<\/strong>, from which developers<strong>\u00a0can simply create secure, scalable and easy-to-use decentralized applications<\/strong>. Applications can be created from scratch or one can use the open-source components provided by the protocol.<\/li>\n<li>And last but not least,<strong>\u00a0there is the native cryptocurrency of the NEAR blockchain<\/strong>, which bears the same name<strong>. Its usefulness is fundamental as in any proof of stake chain.<\/strong><\/li>\n<\/ol>\n<p>Through these three main components,\u00a0<strong>NEAR Protocol presents itself as a large platform, based on blockchain technology, which is governed by its own community.<\/strong><\/p>\n<p>&nbsp;<\/p>\n<h2><span class=\"ez-toc-section\" id=\"the_near_protocol_blockchain\"><\/span><strong>The NEAR Protocol blockchain<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>NEAR Protocol,<strong>\u00a0a decentralized blockchain that achieves consensus through proof of stake<\/strong>. However, the creators of the network\u00a0<strong>Alexander Skidanov<\/strong>, a former Microsoft employee, and\u00a0<strong>Illia Polosukhin<\/strong>, with a background at Google and TensorFlow, did not replicate these well-known models without adding features that make the\u00a0<strong>NEAR<\/strong>\u00a0blockchain distinctive. So, without further ado, let\u2019s take this project apart to understand how NEAR works!<\/p>\n<h3><span class=\"ez-toc-section\" id=\"structure\"><\/span><strong>Structure<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><strong>In pursuit of maximum scalability<\/strong>, so important in the ecosystem,\u00a0<strong>NEAR leaves off the table the need<\/strong>\u00a0for each node participating in the network to<strong>\u00a0run the entire blockchain locally in order to participate in it<\/strong>. This avoids problems arising from possible network congestion, a situation that arises when the number of transactions performed exceeds the processing potential of the network.<br \/>\nYou may ask,<strong>\u00a0but how do they achieve this?<\/strong><\/p>\n<p>And the answer, once again, is\u00a0<a href=\"https:\/\/www.bitnovo.com\/blog\/en\/what-is-third-generation-blockchain\/\">sharding<\/a>, specifically called \u201c<strong>Doomslug<\/strong>\u201c. Through this, now famous, data handling technique\u00a0<strong>NEAR is able to process transactions in parallel, reaching a total of 1,000 per second<\/strong>. This methodology allows it to raise\u00a0<strong>the scalability limit to a direct relation with the number of nodes participating in the network.<\/strong><\/p>\n<p>What\u00a0<strong>sharding<\/strong>, in blockchain terms,\u00a0<strong>proposes is to divide the data storage into different sub-chains<\/strong>, therefore the validators in the network will be randomly assigned to one of these \u201cshards\u201d or sub-chains,\u00a0<strong>allowing multiple simultaneous validations.<\/strong><\/p>\n<h3><span class=\"ez-toc-section\" id=\"consensus\"><\/span><strong>Consensus<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Now that we know the structure of the blockchain,\u00a0<strong>we can understand how it achieves consensus through a mechanism called \u201cNightshade\u201d.<\/strong><\/p>\n<p>According to the specifications of this exclusive development of the\u00a0<strong>NEAR team, each validator in the network processes the transactions that correspond to it according to the shard in which it operates. These transactions are sent to the metachain, the main blockchain of the protocol, where the rest of the validators assigned to the shard from which the transactions were sent, must \u201capprove\u201d the transaction to make it irreversible.<\/strong><\/p>\n<p>The most important thing about\u00a0<strong>this validation process is that it does not stop the production of new blocks<\/strong>, which are made up of transactions from different shards.<\/p>\n<p><strong>Once validated,\u00a0<\/strong>each of these transactions\u00a0<strong>are included in a new block that is added to the NEAR blockchain<\/strong>, with each node being notified instantly.<\/p>\n<div class=\"is-divider divider clearfix\"><\/div>\n<div id=\"image_1591058331\" class=\"img has-hover x md-x lg-x y md-y lg-y\">\n<div class=\"img-inner dark\"><img fetchpriority=\"high\" decoding=\"async\" class=\"attachment-large size-large lazyloaded smush-detected-img smush-image-2\" src=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/09\/Qu%C3%A9-es-NEAR-Protocol.jpg\" sizes=\"(max-width: 768px) 100vw, 768px\" srcset=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/09\/Qu\u00e9-es-NEAR-Protocol.jpg 768w, https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/09\/Qu\u00e9-es-NEAR-Protocol-300x205.jpg 300w\" alt=\"\" width=\"768\" height=\"526\" data-srcset=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/09\/Qu\u00e9-es-NEAR-Protocol.jpg 768w, https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/09\/Qu\u00e9-es-NEAR-Protocol-300x205.jpg 300w\" data-src=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/09\/Qu\u00e9-es-NEAR-Protocol.jpg\" data-sizes=\"(max-width: 768px) 100vw, 768px\" \/><\/div>\n<\/div>\n<h2><span class=\"ez-toc-section\" id=\"near_cryptocurrency\"><\/span><strong>NEAR cryptocurrency\u00a0<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The NEAR blockchain has\u00a0<strong>its native currency, also called NEAR<\/strong>, which fulfills the usual functions of a native crypto in a blockchain with the consensus of proof of stake. What are these functions and their tokenomics, I explain below.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"utility\"><\/span><strong><br \/>\nUtility<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The main functions of this currency are:<\/p>\n<ul>\n<li>\n<ul>\n<li><strong>To be the means of payment for transactions on the network<\/strong>, which have an extremely low cost.<\/li>\n<li>They are given as<strong>\u00a0incentives<\/strong>\u00a0in programs that invite developers to contribute to the network (more information in the last section).<\/li>\n<li><strong>To provide security to the blockchain\u00a0<\/strong>that gave it life, and this is achieved through the daily work of the network\u2019s validators.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p><strong>To become a validator of the NEAR network it is necessary to stake or deposit as a guarantee the necessary amount of NEAR tokens to be among the first 100 validators of the list that is made, exclusively, for each shard or sub-chain of the network.<\/strong><\/p>\n<p>Of course, those users who are not able to run a node and become validators of the NEAR network,<strong>\u00a0have the possibility to delegate their tokens to the validator of their choice, hoping to obtain a reward<\/strong>\u00a0that is estimated according to the percentage of contribution.<\/p>\n<p><strong>For each new block that is produced in the network, a certain amount of NEAR tokens is created. 10% of these new tokens are automatically derived to the NEAR Foundation\u2019s treasury, for the purpose of promotion and development of the network. While the remaining 90% is paid back to the network validator. It is on this last percentage that the reward that the \u201cstaker\u201d or NEAR delegator will obtain is calculated according to the amount provided.<\/strong><\/p>\n<h3><span class=\"ez-toc-section\" id=\"near_and_its_numbers\"><\/span><strong><br \/>\nNEAR and its numbers<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><strong>While NEAR\u2019s mainnet or mainchain was released on October 13, 2020,<\/strong>\u00a0the team previously held a famous\u00a0<a href=\"https:\/\/www.bitnovo.com\/blog\/en\/what-is-an-ico-initial-coin-offering\/\">ICO<\/a>, in two rounds of\u00a0<strong>funding, conducted in July 2019 and May 2020 in which its proceeds exceeded $35 million.<\/strong><\/p>\n<p>Today, it is possible to acquire the token on any of the most popular exchanges.<\/p>\n<p>In reference to the\u00a0<strong>NEAR<\/strong>\u00a0numbers, we have a working capital of\u00a0<strong>465,914,595 out of a total supply of 1,000,000,000,000.<\/strong><\/p>\n<p><strong>It is important to know that NEAR issuance is adjusted based on currency inflation and that a mechanism was established whereby most of the\u00a0<a href=\"https:\/\/www.bitnovo.com\/blog\/en\/what-are-network-fees\/\">fees<\/a>\u00a0paid for each transaction are \u201c<a href=\"https:\/\/www.bitnovo.com\/blog\/en\/what-is-token-burning\/\">burned<\/a>\u201c, which helps to maintain control over the total amount in circulation.<\/strong><\/p>\n<p><strong>As of today, NEAR is in 44th position according to its market value which is observed at US $4,123,168,885<\/strong>. Just a few weeks ago, on September 9, it reached its<strong>\u00a0historical maximum price of about US$11.84, while its historical minimum was US$0.526762 recorded on November 4 last year.<\/strong><\/p>\n<div id=\"image_271891642\" class=\"img has-hover x md-x lg-x y md-y lg-y\">\n<div class=\"img-inner dark\"><img decoding=\"async\" class=\"attachment-large size-large lazyloaded smush-detected-img smush-image-3\" src=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/09\/Qu%C3%A9-es-NEAR-Protocol2.jpg\" sizes=\"(max-width: 768px) 100vw, 768px\" srcset=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/09\/Qu\u00e9-es-NEAR-Protocol2.jpg 768w, https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/09\/Qu\u00e9-es-NEAR-Protocol2-300x205.jpg 300w\" alt=\"Qu\u00e9-es-NEAR-Protocol\" width=\"768\" height=\"526\" data-srcset=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/09\/Qu\u00e9-es-NEAR-Protocol2.jpg 768w, https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/09\/Qu\u00e9-es-NEAR-Protocol2-300x205.jpg 300w\" data-src=\"https:\/\/www.bitnovo.com\/blog\/wp-content\/uploads\/2021\/09\/Qu\u00e9-es-NEAR-Protocol2.jpg\" data-sizes=\"(max-width: 768px) 100vw, 768px\" \/><\/div>\n<\/div>\n<h3><span class=\"ez-toc-section\" id=\"near_protocol_and_its_platform\"><\/span><strong>NEAR Protocol and its platform<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>If you have managed to read this far, you will be aware of o<strong>ne of NEAR\u2019s most important contributions<\/strong>\u00a0to the ecosystem in general, which is undoubtedly\u00a0<strong>its platform supported by its community.<\/strong><\/p>\n<p>It is a platform managed by a committed community that provides pre-conceived tools so that any developer can quickly get actively involved and create their own application on the network.<strong>\u00a0Some of its noteworthy initiatives are:<\/strong><\/p>\n<ul>\n<li>\n<ul>\n<li><strong>An important library<\/strong>\u00a0with code examples to replicate in a simple and didactic way.<\/li>\n<li>A system that guarantees developers of applications on\u00a0<strong>the network 30% of the fees<\/strong>\u00a0generated by transactions of their applications.<\/li>\n<li>The possibility of writing Smart Contracts in\u00a0<strong>familiar languages<\/strong>\u00a0such as Rust, WASM, AssemblyScript.<\/li>\n<li>The development of\u00a0<strong>hackathons<\/strong>\u00a0in order to bring programmers and funders together or directly fund them through the NEAR Foundation\u2019s treasury, with the goal of evolving as an ecosystem.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"final_considerations\"><\/span><strong>Final considerations<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><strong>Undoubtedly, the future of this blockchain and its community is extremely promising.\u00a0<\/strong><\/p>\n<p><strong>Scalable, low-cost systems\u00a0<\/strong>with ample growth prospects\u00a0<strong>will undoubtedly be welcome in the near future of our ecosystem.<\/strong><\/p>\n<p>As I always emphasize, i<strong>nteroperability<\/strong>\u00a0between networks will be of vital importance in the medium term, and with the arrival of the \u201cAurora\u201d bridge,\u00a0<strong>which will connect NEAR protocol with\u00a0<a href=\"https:\/\/www.bitnovo.com\/blog\/en\/what-is-ethereum-eth-and-how-does-it-work\/\">Ethereum<\/a><\/strong>, this network will take a step forward that will provide great benefits for all.<\/p>\n","protected":false},"excerpt":{"rendered":"<p><span class=\"span-reading-time rt-reading-time\" style=\"display: block;\"><span class=\"rt-label rt-prefix\">Tiempo de lectura:<\/span> <span class=\"rt-time\"> 5<\/span> <span class=\"rt-label rt-postfix\">minutos<\/span><\/span>To talk about \u201ccryptos\u201d nowadays is to talk about a topic that is practically installed in the mainstream of our society. It is difficult to find people who, far from being experts, have never heard a word about this subject of \u201ccryptos\u201d. This broad exposure, beyond the essential work of communicators and communicators, lies in [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":6821,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[165],"tags":[],"class_list":["post-11132","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cryptocurrencies"],"_links":{"self":[{"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/posts\/11132","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/comments?post=11132"}],"version-history":[{"count":2,"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/posts\/11132\/revisions"}],"predecessor-version":[{"id":24581,"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/posts\/11132\/revisions\/24581"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/media\/6821"}],"wp:attachment":[{"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/media?parent=11132"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/categories?post=11132"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bitnovo.com\/blog\/wp-json\/wp\/v2\/tags?post=11132"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}