NEAR 2021: Lets look back on a year with great developments

• Protocol development
• Fragmentation protocol
• Capital allocation
• The explosive growth of the NEAR ecosystem
• NEAR's DAO community is growing
• Vision in 2022

Now is the right time to take a look back at NEAR's 2021 highlights: from protocol upgrades, ecosystem funding, community development to new projects launching on the official network ( mainnet) NEAR. 

Protocol development

A sign that a network is growing healthy is the fact that it is constantly adding improvements and tweaks in terms of performance, stability, and security. And NEAR Protocol has done that in 2021. 

NEAR Protocol's engineering team has carried out 20 protocol upgrades. Including protocol update 35 – implicit account. This allows NEAR to have an Ethereum account with public keys. They will be generated on-chain when someone transfers a non-zero amount of tokens to this account. 

Another prominent upgrade is protocol update 42 . In this protocol, engineers have reduced the cost of storing staking from 1N per 10kb to 1N per 100kb. This significantly reduces the barrier to entry for contract developers. Because before that, when a developer wanted to deploy a 300kb contract, they needed to have at least 30 NEARs on their account. Since protocol update 42, they only need to pay 3 NEARs. 

Last but not least, the 48 protocol upgrade brought WebAssembly's runtime from wasmer0 to wasmer2. This change has halved the cost of wasm operations, thereby helping to unlock many applications built on Aurora that were previously blocked due to transactions that did not match the NEAR gas limit. It is known that WebAssembly is a low-level binary file designed for the Web platform, similar to the .exe binary file on Windows.

The trend of continuous improvement and protocol updates is carried out throughout 2021. And culminating in the announcement of NEAR's biggest protocol launch - Sharding . 

Fragmentation protocol 

When it released its protocol design in 2019, NEAR began envisioning a completely forked blockchain. The team quickly realized that the new network would not be able to process hundreds of millions of transactions at once. 

As expected, the average number of daily transactions has now surpassed 300,000. As more and more projects are built on NEAR, the transaction volume will increase significantly in 2022. While the NEAR network is still using only a fraction of its total capacity, the development team wants to initiate the transition to the fragmentation protocol immediately to avoid affecting user transactions. It also ensures that support for every application on NEAR runs smoothly. 

November 15, 2021 marked the beginning of this transition as NEAR launched Simple Nightshade with phase 0 called Simple Nightshade – Network Throughput Enhancement . In the first step, NEAR's sharding will divide the current state (state) into 4 shards while they are still monitored and validated by validators. This will significantly increase the throughput of the network. 

At the beginning of this 2022, NEAR is expected to move into phase 1 of Nightshade called Chunk-Only Producers – Increasing Network Decentralization . In phase 1, NEAR will introduce the new role of segmented producers. It is responsible for validating a segment. Accordingly, they will generate blocks for a specific shard without using expensive hardware to run. Since it does not generate new blocks, this will not affect the security of the chain either. The appearance of Chunk-Only Producers will increase the number of validators and improve the decentralization of NEAR Protocol. 

By Q3 2022, NEAR plans to roll out phase 3 Nightshade – Increasing Accessibility for Validators . With this stage, both the state and the processing will be completely broken down. Also eliminates the need for any validators when tracking fragments. 

Finally in Q4 2022, NEAR will enter phase 3 Dynamic Resharding – NEAR to infinite scale . Specifically, NEAR will allow the network to automatically split and merge fragments based on the resource usage of the current system. This will make NEAR virtually infinitely scalable and can smoothly handle short-term spikes in trading volume.

Capital allocation   

With toddler projects, it's always important to get support in the early stages. It will shape the "strong legs" or "normal legs" of a future project. Understanding that, the NEAR Foundation has implemented plans to call for investments and allocate funds to promote the growth and innovation ecosystem. 

In 2021, NEAR has allocated $800 million raised from funding rounds to new initiatives aimed at funding the decentralized finance sector. Although at that time, the decentralized market was still in its infancy. Specifically, $450 million is allocated for ecosystem grants. The remaining $350 million is allocated to decentralized finance (DeFi) through NEAR's DeFi DAO. As can be seen, DeFi projects on NEAR have been growing strongly with a total value of 200 million USD invested in projects such as Ref Finance, Skyward and Octopus. 

In addition, important projects in the NEAR ecosystem such as Aurora have raised 12 million USD in the first round of funding. The Ethereum Virtual Machine (EVM) with the mission of scaling decentralized applications on NEAR has also received funding from major investment funds such as Pantera Capital, Electric Capital, Dragonfly Capital and others.

With the capital already in place, it is only a matter of time before the NEAR ecosystem "gets up and running".

The explosive growth of the NEAR ecosystem 

The year 2021 of NEAR is marked by the tremendous growth of the ecosystem. Besides being powered by Rainbow Bridge, connecting NEAR to Ethereum, implementing Simple Nightshade sharding, the NEAR ecosystem has also seen an exciting proliferation of gaming, Metaverse, NFT and DeFi projects. .

Games

Games have always been oriented to become an integral part of the crypto industry. The year 2021 has witnessed the outstanding development of game projects in the NEAR ecosystem. Some notable names can be mentioned as follows: 

OP Games: Known as the blockchain-based Web3 gaming platform – OP Games has begun to transform the way users can buy, own, and trade in-game assets. OP Games offers in-game assets as NFTs and turns the entire game into fractional NFTs. This way, players and fans of the game can both co-own the project. In the event this game is successful, it will be shaped to evolve through the DAO. 

Vorto Network: Vorto Network has begun to develop its online marketplace where users can trade in-game items and digital assets through crypto wallets. A blockchain-based Real-time Strategy (RTS) game – Hash Rush set on Vorto Network will launch in January 2022. This will allow players to immerse themselves in the Hermeian galaxy , where they build, compete and trade goods through different levels. Hash Rush would be a great example of Web3's increasingly popular Play-to-earn mechanism. 

NEAR Lands: This is a decentralized multiplayer 2D blockchain game built on the NEAR platform. In the NEAR Lands online universe, players create characters and items. Then interact with friends and other participants while adventuring through the game's landscapes. NEAR Lands is a game designed with pixel graphics, so it offers a beautiful and attractive open world experience. 

Inite : This is a science-based movement game where players take on daily tasks to boost their creativity. Through Inite, players will experience the unique virtual world of Metaverse. In Q4 2021, Inite secured a $50,000 grant to build the NFT gaming platform. Besides, when playing Inite, users can earn tokens by generating ideas to improve cognitive skills and personal productivity.

NFT

2021 is a year of strong growth for the NFT. In turn, NFT projects, collections, and artworks were introduced to the world and received the support of the majority of users. Two NEAR NFT marketplaces – Paras and Mintbase have led the way in bringing more and more NFTs into the NEAR ecosystem.

Starting to build on NEAR in August 2020, Mintbase officially launched in 2021. Initially, the executive team developed Mintbase on the Ethereum platform. Not long after that because of the high cost, the team moved the project to the NEAR platform. It can be seen that, with its fast transaction speed and low cost, NEAR is the perfect alternative to Mintbase. In early December 2021, electronic music DJ and producer deadmau5 and Portuguese indie rock band. the Man teamed up with Mintbase and NEAR to create the NFT single "this is fine". If deadmau5 and Portugal. the Man sells over 1 million records in the US, they will make blockchain history and that will definitely mark Mintbase firmly on the global NFT map. 

Paras is also an NFT trading platform built on the NEAR Protocol. However, Paras orients itself as a place to provide artist's artwork in the form of NFT tokens. The cards sold on Paras are not just pictures made in the form of cards, but they are designed according to themes, stories or legends. With this new way of conveying, the electronic cards on Paras are very interesting, rich and extremely attractive to viewers. Thousands of users have purchased these one-of-a-kind NFT collections on Paras. NFT Paras marketplace also boasts over 18,000 Twitter and 3,000 Telegram followers. 

Built on the NEAR ecosystem, Feiyu is a new take on social media where users express their creativity by sharing memes and GIFs. Feiyu decentralized app users can earn rewards such as tokens or NFT items for participating in the social network. 

In terms of NFT audio on NEAR, DAO Records is working to reshape record labels and pay musicians fairly with their recordings. In the current music industry model, record labels and streaming services make up the majority of musicians' income. Meanwhile with DAO recordings, the founders are encouraging indie artists to release and package new music as audio NFTs. To date, DAO Records has released over 150 NFTs from over 100 artists. And over the past 14 months, DAO Records has also hosted more than 50 virtual events where musicians, fans, and even NFT enthusiasts can meet and socialize in tailored Metaverse gatherings.

Metaverse

In 2021, on the NEAR generation system, many applications in the field of Metaverse will also appear. While each Metaverse project has a different unique nuance, overall, they have laid the groundwork for integrating blockchain, DeFi, and NFT games on NEAR. 

For example, the Metaverse AI project, built on NEAR, is focusing on developing an open Metaverse for Web3. Using Metaverse AI's advanced AI engine, users can create decentralized identities and high-fidelity 3D avatars. These blockchain-based DiD (Decentralization Identifier) ​​avatars provide users with ownership of their virtual identities and assets. At the same time the user has the ability to move them across larger Metaverses.

Another NEAR Metaverse project, Reality Chain, will launch on the Octopus Network – a network of application chains based on the NEAR substrate. Reality Chain provides users with games and social activities with immersive feeling and vivid features and functions. 

Meanwhile, the Illust Space app takes a completely different direction about the Metaverse. The Illust Space team is building an augmented reality Metaverse that gives users the tools to combine the real and digital worlds for their artwork. Also make them collectible through NFT technology.

Also in 2021, NEAR launches the MetaBUILD series – a hackathon designed to incentivize developers to build on NEAR. As the name suggests, building the Metaverse is the main highlight of this hackathon. The first MetaBUILD was held from August 27, 2021 to September 19, 2021. And most recently, MetaBUILD 2 is continuing to be held from December 22, 2021 to February 10, 2022). In both contests, NEAR awarded $1 million in prizes to successful developers and teams. 

DeFi

DeFi (decentralized finance) has become an important foundation of any cryptocurrency ecosystem. In the more than 12 months since the launch of the mainnet, there are now more than 40 DeFi projects on the NEAR ecosystem. From infrastructure providers like Rainbow Bridge, Flux, Aurora to 1inch token swaps, Trisolaris and Onomy Protocol. There are staking platforms, lenders, borrowers, credit scorers and even BananaSwappers.

As shared above, NEAR's $800 million global ecosystem fund is being allocated mainly to DeFi projects and other Dapps built on NEAR. NEAR Nightshade Sharding will also enhance DeFi by extending the transaction speed and security of the blockchain.

Launched in 2021, Aurora is one of the most notable DeFi projects on NEAR. This is the platform that makes EVM contracts interoperable on NEAR. Also allow developers to continue using Ethereum while driving their application with NEAR's super fast transaction system with low barrier to entry. Aurora is partnering with several other promising DeFi projects on NEAR, like the oracle cross-chain Flux and Rose – a stable borrowing and swap protocol that elevates the ecosystem's DeFi game.

Besides, another well-known DeFi project is called Ref Finance - an AMM-based DEX built on NEAR Protocol. Ref Finance was created with the goal of organizing all components of DeFi including: AMM DEX, Lending protocol, Synthetic Asset and many more features into a single platform. 

If you're looking for an interest-rate protocol marketplace, Burrow is a pretty interesting dApp to explore. Meanwhile, if users are interested in a solution to distribute tokens for investors, don't go through the first IDO platform on NEAR - Skyward Finance. This is the place where new projects on NEAR Protocol can easily access capital from the community. In addition, Skyward Finance's DAO will allow the community to access token launches immediately instead of letting the frontrunners (private investors and venture capital funds) pump and then pump. that dumps the token. 

NEAR's DAO community is growing

One of NEAR's main directions in 2021 is to develop and diversify the DAO (Decentralized Autonomous Organization) community. This is also considered a new trend that the NEAR ecosystem in particular and the blockchain community in general expect to explode in 2022.

As reported by NEAR on December 28, 2021, NEAR's DAO ecosystem hub – Sputnik DAO V1 currently has a total of 248 DAOs with a total of 17,633 transactions. The total payout amounted to 989,598 NEAR tokens, equivalent to about 9,292,324 USD. In addition, the total locked value (TVL) of the Sputnik DAO is 113,969 NEARs, or about 1,070,164 USD. 

Much of the growth of the DAO community can be seen in the NEAR blockchain infrastructure and the DeFi space. The largest DAOs by total assets are Aurora (a token exchange bridge between NEAR and Ethereum) and Octopus (a platform for building appchains).

2021 sees explosive growth in the way DAOs experiment with governance tools on NEAR. During the first half of the year, SputnikDAO went through two iterations – one to popularize crowdfunding and the other to incorporate custom calling capabilities. By the time Astro DAO launched in October 2021, the demand for its services had caused hundreds of DAOs to be born in just 2 months. And in Q4 2021, the NEAR community has put a lot of thought into protecting the state's liability, legal entities, and regulations for DAOs.

Creations DAO – a fully community-run Vertical DAO – launched in 2021 to support the DAO and creative organizations ecosystem. NEAR is also supporting a research initiative organized by the government to examine DAO-based reward systems. DAO projects are being supplemented by DAO Guilds. Various Guilds even operate as specialized sub-DAOs working in areas such as legal, software development, and DeFi. 

Switzerland-based DaoBox is another resource for projects and organizations that want to design a DAO. The company provides a set of tools to build a DAO on NEAR, helping users with the need to set up a DAO get headquarters address, fundraise and comply through accounting.

Vision in 2022

In general, in the past year 2021, NEAR has built and developed very well infrastructure pieces to serve as a solid fulcrum for projects and applications participating in NEAR in the coming time. It is known that some product developers on NEAR will launch projects in 2022. This means more DeFi, NFT, Gaming, Metaverse and other interesting projects will be added to the system. NEAR ecology. 

With a global ecosystem funding of $800 million, NEAR hopes to see many more DAOs established in 2022. Endowments, Guilds, blockchain experts and other resources will be a factor. important to help DAOs become even more successful. And especially bring the user experience from Web2 to the open Web (open Web).

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