Cryptocurrency: Near Protocol (NEAR) - Function, Operation, and Aim in 2025 - An Examination

Cryptocurrency: Near Protocol (NEAR) - Function, Operation, and Aim in 2025 - An Examination

In the rapidly evolving world of blockchain technology, Near Protocol has emerged as a significant player, making strides in scalability, AI integration, and institutional adoption.

Launched officially in October 2020, Near Protocol, a Layer 1 blockchain, was designed to democratize access to decentralized applications and facilitate the advent of Web3. The brainchild of a trio of visionary entrepreneurs—Alexander Skidanov, Illia Polosukhin, and Erik Trautman—the platform has quickly gained traction, particularly in 2021, with the launch of numerous DeFi and NFT applications within its ecosystem.

One of the key factors setting Near Protocol apart is its exceptional performance while maintaining an eco-friendly approach. By being carbon neutral, the blockchain offers a sustainable solution for the growing demands of the digital economy. This eco-friendly approach is coupled with Nightshade sharding technology, enabling the network to handle up to 100,000 transactions per second, making it one of the most efficient Layer 1 blockchains.

As Near Protocol continues to grow, it is focusing on significant technological upgrades and ecosystem growth. The Q4 2025 roadmap includes key improvements such as stateless validation, dynamic sharding, and chain abstraction, aiming to scale the network's throughput to 1 million transactions per second. These enhancements are crucial for supporting emerging use cases like AI-native applications and micropayments.

Near Protocol is also positioning itself as the first truly AI-native blockchain, combining artificial intelligence and blockchain technology. In partnership with a leading AI infrastructure provider, Near is launching a User-Owned AI initiative to embed autonomous agents into its ecosystem, positioning Near as a hub for next-generation decentralized AI-driven applications with an emphasis on user ownership and privacy.

The NEAR token, the central element of the Near Protocol ecosystem, is used for transaction fees, staking, and decentralized governance. Institutional interest in NEAR has been growing, as evidenced by the July 2025 launch of the Bitwise NEAR Staking ETP, which allows regulated institutional investment and staking rewards participation. This development marked an important step in protocol adoption, causing the token to surge nearly 10% in the market.

From a tokenomics perspective, Near Protocol has proposed halving its annual inflation rate from 5% to 2.5% to reduce token dilution and create a more sustainable, deflationary economic model. This strategy aims to enhance long-term value retention for NEAR holders and improve incentives for staking and governance as the ecosystem matures.

Looking to the future, projections indicate optimistic adoption and price growth potentials for NEAR. Some forecasts suggest that NEAR could surpass $20 by 2031 amid increasing blockchain adoption and the platform’s expanded utility in AI and cross-chain use cases.

However, short-term market volatility and recent development delays have posed challenges for Near Protocol. It is crucial for investors and users to approach these developments with a discerning eye and make informed decisions based on reliable information.

In terms of buying and storing NEAR, the best platforms offer low trading fees, a wide choice of cryptocurrencies, and advanced trading tools. Examples include Bitget, Bybit, and others. When it comes to security, it is recommended to transfer NEAR tokens from exchange platforms to a secure personal wallet for total control over the assets. Cold wallets (hardware wallets) like Ledger provide the highest level of security against online hacks and are suitable for storing large amounts or for long-term storage. Hot wallets (software applications) like MetaMask or Trust Wallet are more convenient for frequent use and interacting with decentralized applications but are inherently more vulnerable to malware and phishing than cold wallets.

Educational initiatives like NEAR University and NEAR Academy are also part of the Near Protocol ecosystem, aiming to foster a robust community of developers and users. Aurora, the EVM compatibility solution, was deployed in 2021, enabling Ethereum developers to easily migrate their applications to the Near Protocol platform.

In January 2022, the NEAR token reached an all-time high (ATH) of $20.42 after a 56% increase in just 7 days, demonstrating the strong investor interest in the token. As Near Protocol continues to innovate and grow, it remains well-positioned to capitalize on emerging blockchain and AI application trends.

1. The eco-friendly approach of Near Protocol, a Layer 1 blockchain, has promoted its placement in the digital economy, offering sustainable solutions while maintaining exceptional performance.
2. With AI integration as a key focus, Near Protocol aims to position itself as the first AI-native blockchain, launching a User-Owned AI initiative to embed autonomous agents into its ecosystem.
3. The Near Protocol ecosystem is not limited to finance and DeFi applications but also includes education-and-self-development through initiatives like NEAR University and NEAR Academy.

Read also: