Try Quests to earn NEARNew Grant Approach
What is the Question?🚨
The NEAR Foundation recently announced it would examine and update its grant approach and fundraising strategy “in line with the Foundation’s goal of providing a clear and concise update to continue to foster transparent communication.”
According to the blog post linked below, the Foundation is currently working to create a more decentralized model of capital allocation. Now, we want your help in designing that ecosystem.
Design and create a new strategy for grant and fundraising allocation that will aid the NEAR Foundation in its goal “empower the ecosystem to make decisions that support the strategic approach that will drive NEAR to the next phase of its roadmap.” Your strategy should be backed up by on-chain data, as well as your own opinions on what will create a strong capital allocation strategy for the Foundation. Learn more here.
Ideas and Advices:
- User Growth and People get to know NEAR Protocol and its Foundation
- Contract Deployment and the Power of Developers
- Extend the Decentralization and Staking Environment
Introductionđźš©
> ## What Is Near Protocol and How Does It Work?
Near Protocol is a layer 1 blockchain network. It provides a platform on which developers can build decentralized applications (dapps). The most successful layer 1 blockchain is Ethereum, so protocols like Near are seen as challengers.
The key yardsticks for layer 1 networks are transaction costs, speed and the ability to maintain those features as transaction volumes grow. These factors are the focus for layer 1s like Near to improve upon Ethereum, which has encountered issues with costs and speed over the last few years.
Near Protocol is faster and cheaper than Ethereum. More importantly, it promises to be faster than some of the other largest challengers. When fully implemented, Near is expected to be able to process up to around 100,000 transactions per second (TPS). Ethereum’s largest rival, Solana, averages less than 3,000 transactions per second, according to its own blockchain explorer. Ethereum averages double-digit transactions per second. Bitcoin does less than 10.
Outside the crypto sphere, an important comparison is Visa’s (V) capacity. The global payments giant processes around 7,000-8,000 TPS, based on its claim of 232.5 billion transactions over a 12-month period. Near Protocol could eclipse that, though it has not yet realized its theoretical potential as of July 2022.
“Near has built technology to enable transactions that are fast (~1 second), quick to finality (~1-2 seconds), cheap (less than a penny), and secure,” crypto research firm Messari noted in March 2022.
More Info
Method⚡
In this dashboard, i will give some advices to NEAR Foundation to update their grant approach and fundraising strategy and analyzed some related metrics to this purpose and backed up my thoughts with on-chain data as well. It seems they want to create a more decentralized model of capital allocation, so i gave them some suggestions and advices to reach their purpose.
I talked about a total of 3 ideas about this topic. First one is about user growth and advertising to attract more people to its network and ecosystem and make more partnerships. For the second idea i talked about the contract deployment on NEAR and developers power and why they should not underestimate them on their way to the goal.
And in the last section i talked about the nakamoto coefficient and staking behavior on NEAR by validators and how they relate to this topic at all.
For on-chain data i used Flipsidecrypto as my data provider and extracted the needed data from ==near.core== database.
First Idea: Users Growth and People get to know NEAR Protocol and its Foundation
One way that can bring this grant approach to the next level is that protocol launch more interesting and easy to use dapps or platforms or make partnerships with other popular platforms to get more popularity in not only web3 but web2 world too.
Sweatcoin can be described as a play-to-earn project founded on the belief that movement and an active lifestyle could have real value. As gaming is so popular in nowadays, we can clearly see this partnership effect on NEAR activity after September 13th 2022 when NEAR recorded a huge spike on Sep 13th with over 120K users more than its previous day!
> Here is some additional explanations to help with the topic:
In September, Sweat Economy—the “economy of movement”—successfully launched on NEAR with the largest ever airdrop to active, opted-in, wallets. The Move-to-Earn platform, active in Web2 since 2016 with over 130 million global users of its Sweatcoin app, distributed their new Web3 SWEAT token to 13.5M token holders. The Sweat Wallet app quickly became the #1 most downloaded Finance app in more than 50 countries. This follows Sweat’s success as the fastest IDO ever to sell out on the DAO Maker platform.
Sweat Economy distributed over 4.7 Billion of its newly launched SWEAT tokens to the 13.5M Sweatcoin users who opted to enter Web3. For many of these users, it is their first experience with blockchain technology, making this the largest ever on-ramping of self-custody users from Web2 to Web3.
As we see, this kind of events like Sweat economy launch on NEAR and its airdrop to newbie people in web3 will attract more people to come and get to know what is happening in web3 especially with NEAR protocol and its partners!
In the charts below, i divided the charts to 3 periods for 3 partnerships that NEAR foundation made to see how they effected this ecosystem in that time and also in long term.
Second Idea: Contract Deployment and the Power of Developers
As you may know or may not know, NEAR protocol is a blockchain that focuses on developer and user-friendliness. To accommodate this mission, NEAR has incorporated features like human-readable account names as opposed to only cryptographic wallet addresses, and the ability for new users to interact with dApps and smart contracts without requiring a wallet at all.
Projects building on NEAR include Mintbase, a non-fungible token (NFT) minting platform, and Flux, a protocol that allows developers to create markets based on assets, commodities, real-world events, and more.
Atm, NEAR Foundation is actively working towards a more decentralized model of capital allocation that will initially involve the DeveloperDAO, besides MarketingDAO and CreativesDAO with an additional DAO that will begin formation in Q1 of 2023. This will impact the ecosystem in the following ways:
- NEAR Foundation will cease allocating capital directly from our inbound start-up grants program
- working directly with community members to outline a clear application process for funding via the DAOs.
- Any projects that have already received a portion of their funding and are working towards their agreed milestones will continue to be supported through the remaining milestones.
- Any application that is not already in the approval stage will not receive funding. However, we will do our best to redirect you to appropriate, alternative funding sources.
==Key Insights and Personal Thoughts:==
Contract development is a very helpful matter for every chain especially NEAR which let developers build dapps on it and its easier than other chains to build something on.
After April 2022, number of monthly active contracts started to decrease and by far it decreased more than 50% in January 2023 and it is not looking good and also this matter has multiple reasons: First one is the bearish market, users are getting disappointed from crypto and the awful incidents that happened on 2022 like Terra crash or FTX’s collapse and seems like they are leaving crypto world and not just for NEAR blockchain, for the whole market.
Also the contract deployment on a monthly basis has decreased massively after 2022’s third quarter. If NEAR Foundation wants to get more decentralize with its capital allocation, they should work on their contract development and attract more developers to come and build attractive and interesting dapps or other things to absorb normal people from web2 and bring them to web3 especially NEAR and its new plans for grant approach.
We can observe that after Sweatcoin launch on NEAR which happened on Sep 13th, this contract completely outperformed other popular NEAR contracts like Aurora and NearCrowd and took the first place from Aurora in top 10 contracts chart.
Third Idea: Extend the Decentralization and Staking Environment
The next important part for every Chain is the decentralization and the nakamoto coefficient. In blockchain, decentralization refers to the transfer of control and decision-making from a centralized entity (individual, organization, or group thereof) to a distributed network. Decentralized networks strive to reduce the level of trust that participants must place in one another, and deter their ability to exert authority or control over one another in ways that degrade the functionality of the network.
The Nakamoto coefficient measures decentralization and represents the minimum number of nodes required to disrupt the blockchain's network. A high Nakamoto coefficient means that a blockchain is more decentralized.
==Key Insights and Personal Thoughts:==
NEAR’s current Nakamoto Coefficient is 8 but this chain has been recorded its highest coff on October 2023 with 9. The more nakamoto coefficient a chain has, the more decentralized it is.
Figment.poolv1.near validator has been staked over 39M $NEAR over time and this number is almost 15M more than the second validator which is astro-stakers.poolv1.near.
In the pie chart i tried to show the top 10 NEAR validators based on their staked amount where we can see Figment with accounting 12.7% of top 10 share is in the lead.
If NEAR Foundation wants to get more decentralized and upgrade its capital allocation to decentralize level, they should set things up for validators to stake more and invest on NEAR with their funds so the project gets more powerful and get supported by strong validators and in that time it can get more decentralized and also in this matter, they can sign more partnerships with popular platforms and dapps too.
Conclusion and Final Suggestionsđź’ˇ
- NEAR Foundation as i said should work on their reputation and sign more partnerships with popular platforms to bring users from web2 to their environment and introduce them to web3 especially NEAR and what does this chain do actually. We saw that when Sweatcoin launched on NEAR, number of new wallets and transactions experienced a massive spike on mid September and so many users started to know web3 and especially NEAR.
- We should not underestimate developers power and what they can do with their knowledge. NEAR is a fast and user friendly blockchain which allow developers to build their dapps on this chain and they set up the space for them to work easier than other spaces. If NEAR Foundation gain more new developers which deploy more new contracts on NEAR, they can extend the decentralization and development with this purpose and also attract more stronger developers too.
- With the performance that i analyzed from different angles, we can say that NEAR future is so bright and they actually care a lot about their community growth and users experience with this chain. I saw before that chains care about their supporters but in NEAR, it is something different and the Foundation is actually putting so much effort into this chain and its ecosystem! They work so much on their transparency and want to be as much transparent as they can and represent the real web3 to the whole world.