Near Protocol: 2025 Mid-Year Review and Analysis

Introduction

Near Protocol (NEAR) is a sharded Layer-1 blockchain launched in 2020, designed for high throughput, low fees, and ease of use. NEAR uses the Nightshade sharding architecture and a novel Doomslug consensus (a form of delegated proof-of-stake) to achieve sub-second finality. The protocol emphasizes developer- and user-friendly features (e.g. human-readable accounts, easy UX) and interoperates with Ethereum via Aurora (an EVM on NEAR) and the Rainbow Bridge. As of mid-2025, NEAR has risen in importance: it boasted 46 million monthly active users in May 2025 (second only to Solana among L1s) and a ~$2.7 billion market cap (34th largest crypto). Its co-founders’ AI background and the network’s scaling potential position NEAR as a leading “blockchain for AI” and scalable dApp platform. This review examines NEAR’s development, ecosystem metrics, and market behavior from Jan 2025 to mid-July 2025, assessing its growth drivers and investment prospects in the current crypto landscape.

Major News Events (Jan–Mid-Jul 2025)

Feb 3, 2025 – Launch of NEAR Dev

The NEAR Foundation announced NEAR Dev, a spin-out incubator for top application teams. This move (alongside keeping the community-run DevHub) aims to intensify developer support, signaling focused investment into building NEAR’s dApp ecosystem.

May 7, 2025 – TOKEN2049 Dubai

Near’s founders (Illia Polosukhin and others) headlined panels at TOKEN2049, emphasizing NEAR’s AI vision and telecom/Web3 collabs. Highlights included discussions on telecoms’ role in decentralized infra and NEAR’s “user-owned” AI infrastructure. NEAR also unveiled partnerships (e.g. validator tooling with OpenMesh/DappNode) and staged ‘deAI’ and cross-chain events, raising its profile among investors and developers.

May 13, 2025 – 600ms Blocks & 1.2s Finality

A network upgrade (Nightshade 2.0) cut NEAR block time to 600ms with finality ~1.2s – roughly 10× faster finality than Solana and orders-of-magnitude faster than Ethereum L2s. This “Blink” upgrade highlights NEAR’s performance edge. The team projected even shorter (≈200ms) blocks by year-end.

May 19, 2025 – RPC Endpoint Deprecation

NEAR announced the phased shutdown of free public RPC nodes (near.org and Pagoda) in summer 2025. This required developers to migrate to private or alternative endpoints (as Pagoda winds down), underscoring NEAR’s push for more sustainable, decentralized infrastructure.

Jun 24, 2025 – Inflation Cut Proposal

A community proposal (HOT_DAO) sought to halve NEAR’s fixed inflation from 5% to 2.5%. With on-chain fee burns near zero (only ~0.1% of supply/year), net inflation has been ~4.9%, diluting holders. Cutting to 2.5% would align inflation with usage (≈2.4% net) and mirror trends on other L1s. The vote (validator-driven) was set for late July, reflecting active governance on tokenomics.

July 17–18, 2025 – Price Surge and AI Rally

NEAR’s price jumped 11–12% around July 17–18, rising from ~$2.68 to a session high of $3.04. News reports attributed this rally to broad altcoin momentum and NEAR’s ties to the AI narrative. For instance, on July 18 NEAR hit $3.04, with analysts noting that NEAR was outperforming many tokens as AI-focused projects led gains.

July 18, 2025 – NEAR Intents × Sui Integration

NEAR Intents (a cross-chain aggregator) launched support for direct swaps into Sui Network. This allowed one-click transfers from 20+ blockchains (ETH, BTC, Sol, etc.) into Sui without bridges, expanding liquidity access. The launch coincided with booming Sui usage (TVL ~$1.7B) and illustrates NEAR’s push into cross-chain DeFi.

Ongoing – Ecosystem Partnerships and Funding

Mid-2025 saw collaborations like the NEAR–Chainbased partnership for DeFi asset management (leveraging NEAR’s high-speed, low-cost chain). The NEAR Foundation’s healthy treasury (~305M NEAR + $285M fiat) has funded grants and new initiatives (e.g. Nuffle Labs) through 2025. Active hackathons and ecosystem hack grants continued, though fewer public controversies or outages emerged in this period.

Each news item above had ripple effects: network upgrades and events bolstered developer confidence, while governance moves on inflation indicate maturing economics. The AI integration narrative (e.g. panels, Intents) especially captured market attention, as reflected in the mid-July price pop.

Key Growth Catalysts in 2025

AI and Intelligent Agents

NEAR is positioning itself as “the blockchain for AI”, aiming to power composable AI agents and on-chain ML. The Intents protocol integration and conference panels on AI/web3 (Token2049) highlight this theme. The crypto market’s AI hype has acted as a catalyst – coverage repeatedly notes NEAR’s AI links as a bullish driver.

Scalability & UX

NEAR’s blazing performance (600ms blocks, 1.2s finality) and low gas fees are key for high-throughput apps. This has attracted large-scale projects: for example, the Sweat Economy move-to-earn app (built on NEAR) boasts ~140 million global users. This mass adoption app epitomizes how NEAR’s throughput and user-friendly accounts can attract mainstream users.

DeFi Revival & TVL Growth

The DeFi sector’s resurgence in 2025 has helped NEAR’s TVL grow. Leading NEAR DeFi protocols each hold on the order of $100–200M in TVL (e.g. Burrow ~$156M, Rhea Finance ~$168M), rising as more projects deploy. Cross-chain initiatives (e.g. NEAR Intents enabling swaps to Sui) also expand NEAR’s DeFi footprint.

NFT and GameFi Activity

NEAR’s low fees have revitalized NFT/gaming pipelines. Projects like Aurora EVM allow Ethereum games to migrate to NEAR. OpenSea integration and new marketplaces have drawn creators, and partnerships (e.g. with CELEBRITY loyalty NFTs, user-generated content) have kept NFT buzz alive. (Precise volume stats are limited, but anecdotal spikes around special drops suggest renewed interest.)

Institutional & Ecosystem Adoption

Institutional investors (as evidenced by Bitwise data) note NEAR’s user growth, and large crypto funds remain active in the ecosystem (NEAR Foundation has funding from a16z, Tiger, etc.). Entities like Deutsche Börse and DEFI aggregators have explored NEAR infrastructure. The community often cites NEAR’s ability to onboard users at scale as a fundamental strength, which attracts new projects and funding.

Collectively, these catalysts (aligned with broader crypto trends: AI, DeFi, NFTs) drove sustained interest. For example, the spike in NEAR’s development metrics and social chatter around AI-linked use-cases point to growing optimism from Q2 into mid-2025.

Overview of NEAR: Technology & Architecture

NEAR’s consensus and sharding design underpins its performance. It uses Nightshade sharding to split the state into parallel pieces, allowing horizontal scaling. The Doomslug consensus finalizes blocks in one round – essentially “instant finality” in ~1–2 seconds. As Pontem notes, NEAR aims for very high throughput: it claims up to 100,000 TPS in theory with 1-second block times (though real-world throughput depends on usage).

Key advantages distinguishing NEAR from other L1s include:

Speed and Finality

With 600ms blocks (1.2s finality) after May 2025, NEAR rivals Solana’s speed and far surpasses Ethereum layer-1/L2s. Its block times and finality latency are among the lowest in blockchain, benefitting fast user experiences.

Sharding

Nightshade allows NEAR’s throughput to grow with more validators. This contrasts with non-sharded chains (e.g. Solana, Avalanche) and even with Ethereum (currently focusing on rollups vs. late sharding). Sharding also helps keep gas low.

Developer Ecosystem

NEAR supports Rust/WASM smart contracts and offers advanced features like account abstraction (human-readable accounts, on-chain recovery) and seamless user onboarding. It also natively supports an Ethereum-compatible layer (Aurora) and bridges. The Rainbow Bridge enables trustless ETH–NEAR transfers, making it easy to port assets/DeFi from Ethereum.

Consensus Innovation

The custom Doomslug+TPoS model (delegated PoS with threshold-based finality) ensures network security and up to ~9% staking yields (prior to proposed inflation cut). NEAR’s validators (currently ~262 active validators) can run on commodity hardware with NEAR’s simple cloud setup, promoting decentralization (vs. specialized infrastructure on some L1s).

In sum, NEAR’s architecture emphasizes the “scalability trilemma” by pushing on throughput and usability while maintaining a high validator count. It is architecturally distinct from Ethereum’s rollup path, as it achieves scalability through sharding from day one. These technology foundations have been core to NEAR’s mid-2025 narrative: upgrades like “Blink” (optimistic blocks) and finality improvements concretely demonstrate its performance edge.

Mid-2025 Ecosystem Statistics

Validators

About 260–270 active validators (nodes securing NEAR) are online as of July 2025. This count has steadily increased over 2024–2025, reflecting growing decentralization and community participation.

Transactions/Throughput

NEAR consistently handles millions of transactions per day. For example, one “HOT Wallet” processed ~2.9 million transactions in a recent week. Peak throughput (theoretical) is up to 12,000 TPS, but actual daily TPS averages in the tens-to-hundreds (limited more by demand than network). Daily transaction volumes trended upward in 2025 as usage rose, with occasional spikes on network events or NFT drops.

Total Value Locked (TVL)

DeFi TVL on NEAR has climbed into the low hundreds of millions. Leading protocols like Burrow ($150–160M TVL) and Ref Finance (DEX, single-currency pools) dominate. For reference, Burrow’s TVL was ~$155.8M per DappRadar. Rhea Finance and other AMMs add further tens of millions. In aggregate, NEAR’s TVL (including Aurora sidechain) is on the order of several hundred million USD – a growth of 10–30% year-to-date, though still modest vs. Ethereum.

DeFi/DApps Count

NEAR hosts dozens of active dApps across categories. Several dozen DeFi projects (lending, DEX, stablecoins) and dozens of NFT/gaming projects are live. NFT marketplaces (e.g. Paras, Mintbase) see regular volume. New launches like Spin Protocol (futures) and Mitte (NEAR’s NFT indexer) entered 2025, expanding infrastructure.

NFT and Social Activity

NEAR’s NFT market (on-chain sales volume) and social dApp usage have seen mixed trends. General NFT volumes on-chain decreased in early 2025 industry-wide, but NEAR-specific drops (celebrity projects, game releases) occasionally boosted platform activity. Guilds like Mintbase and social apps (like MintGate’s B2B NFTs) are moderately active.

Overall, the data show a growing ecosystem: NEAR commands robust on-chain activity (multiple million daily transactions, as noted) and a maturing DeFi/NFT landscape. As one summary notes, NEAR’s infrastructure has already “onboarded new users into crypto at scale”, evidenced by its tens of millions of active addresses.

Sentiment Analysis (2025)

Throughout early–mid 2025, community sentiment on NEAR has generally shifted from cautious to increasingly optimistic, reflecting its new catalysts. On crypto social media (Twitter, Reddit), discussions have centered on NEAR’s AI positioning and tech upgrades. After a prolonged lull in Q2, mid-July saw a surge of positive commentary as NEAR’s price and usage rose.

Quantitative sentiment indicators align with this positivity. For example, crypto news aggregators and “fear & greed” trackers tag NEAR’s recent rallies as positive sentiment. CryptoFear indices mark articles about NEAR’s 6–7% surges and scalability goals as “positive” events. Major reports (e.g. CoinDesk) note bullish momentum when NEAR rose in tandem with altcoins. The CoinStats news piece explicitly calls NEAR “bullish” with “remarkable growth” in user activity.

Conversely, some caution remains. Offline communities have sometimes worried about NEAR’s inflation and the flat fee revenue. Skeptical posts occasionally note that NEAR remains far below all-time highs (down ~87% from its 2022 peak). However, these concerns are balanced by pride in NEAR’s rapid MAU growth and optimism about upcoming governance changes.

In sum, sentiment has trended bullish in mid-2025. The social narrative emphasizes NEAR’s “AI + scale” thesis. Polls and crypto influencers often highlight NEAR’s unique tech (account abstraction, sharding) and recent milestones. Although not backed by an independent sentiment-scoring service here, the convergence of media praise and on-chain growth suggests community perception turned decisively positive by summer.

Fundamental Analysis

Tokenomics

NEAR has a fixed 5% inflation rate (90% of new tokens to validators) set at launch. With almost no fee burning (only ~0.1% of supply burned annually), the actual inflation hitting supply is ~4.9%. The governance proposal to reduce this to 2.5% would cut new issuance roughly in half. For comparison, many other PoS chains (Polkadot, Solana, Aptos) have also moved to lower inflation regimes. A high inflation dilutes holders, so a cut is seen as fundamentally positive if passed (boosting long-term value by scarcity). On the other hand, current staking yields (~9% APY, to be ~4.5% after the cut) have been a draw for depositors. The plan reflects an evolving tokenomics debate in the NEAR community.

Treasury and Funding

The NEAR Foundation reported a strong treasury in early 2024 (still largely relevant): about 305 million NEAR tokens (~$1B) plus $285 million USD fiat, and ~$70 million in investments. This war chest funds grants, ecosystem incentives, and R&D. It gives NEAR financial runway to weather bear markets or fund big initiatives (e.g. the $350M Ecosystem Fund launched in 2022). However, it also concentrates financial control: large NEAR allocations reside with the Foundation and early contributors, a factor investors watch.

Developer Activity

On-chain development (GitHub commits, new contract deployment) showed a resurgence in mid-2025. As noted above, Santiment data indicates a rebound in coding after a spring lull. The NEAR Collective’s grant programs and NEAR Dev initiatives have re-energized builders. In Q1 2025, NEAR’s total DeFi TVL was up ~23% (to $62M) despite a shaky market (from related reports). Weekly active wallet growth is also positive (CoinStats reported NEAR second in L1 user activity at 46M MAUs). These trends suggest fundamentals improving: more dApps launching, more dev teams active.

Ecosystem Growth

Partnerships and integrations are expanding NEAR’s reach. NEAR Intents linking to Sui, the Rainbow Bridge to Ethereum, and Aurora for EVM compatibility all deepen NEAR’s interoperability. Enterprise and institutional interest (e.g. telecom/Web3 panels, Accenture trials on NEAR) indicate broadening use cases. The ecosystem foundation (like Octopus Network building app-specific chains on NEAR) adds vertical growth. Compared to peers, NEAR’s ecosystem is still smaller than Ethereum or even Solana’s, but it is broader than newer chains like Sui or Aptos. Importantly, on metrics like active addresses and user growth, NEAR has outpaced many of its competitors.

Competing L1s

Compared with Ethereum, NEAR offers much faster finality and scalability (but Ethereum has vastly more users and capital). Avalanche (AVAX) similarly touts sub-second finality via its consensus, but its subnet model is centralized around Ava Labs vs. NEAR’s more decentralized validator set. Sui and Aptos (other newcomer L1s) emphasize gas-less models (Sui) or Move VM (Aptos), while NEAR’s niche is its user-friendly features and broad dev tools. In a Web3 index like Messari, NEAR’s market cap and TVL are smaller than Avalanche or Solana, but its growth rate in usage has been among the highest. Fundamentally, NEAR’s main advantages are scalability + UX (account abstractions, easy dev onboarding), which it claims competitors lack. This sometimes offsets its smaller network effect in investors’ eyes.

In summary, NEAR’s fundamentals paint a mixed but improving picture: token economics are under review (inflation cut vote), but adoption metrics are strong. The treasury and project pipeline are healthy. Compared to giants like ETH, NEAR still has far fewer fees and TVL, but its design and user uptake show promise. Its ability to capture the “next billion users” via fitness apps or AI agents is often cited as unique (e.g. Grayscale noted NEAR’s potential at the AI-crypto intersection).

Technical Price Analysis (2025)

From January through July 2025, NEAR’s price oscillated in a broad range (~$1.80–$2.75), largely moving sideways before the mid-summer breakout. Early 2025 saw NEAR consolidating under $2.00 for a period. Key technical levels emerged: support around $1.99 (noted as a critical floor by analysts), and resistance near $2.75–$2.80 (a supply zone several analysts identified). A bit above that, ~$3.21 was cited as a higher resistance target.

Throughout Q1/Q2, NEAR repeatedly tested the $1.90–2.00 zone, holding it each time; this gave bulls confidence that a floor was in place. On the upside, the $2.60–2.70 area capped rallies for months. Trading volumes were modest until mid-July when NEAR began climbing sharply, mirroring a broad altcoin uptrend. In that timeframe, CoinDesk and market reports observed that **NEAR’s rally coincided with Bitcoin’s rise to new highs ($120K+) and an altseason led by AI tokens**. (Bitcoin’s breakout above $120K was a macro tailwind for altcoins, including NEAR.)

On July 17–18, NEAR decisively broke above the previous $2.70 barrier, reaching a high of ~$3.04. This ~12% one-day jump came on strong volume and positive funding rates. Technical commentators noted NEAR had formed a “double bottom” around $1.81–$3.35 in the prior months, suggesting bullish reversal potential as long as key supports held. Indeed, analysts highlighted that “as long as NEAR remains above $2.55, the bullish outlook is expected to remain valid”, projecting targets of $2.74, $3.21, etc. NEAR did briefly enter slightly overbought RSI territory, so some traders were braced for a pullback.

After the mid-July peak (~$3.04), price settled around $2.90–$3.00. The key near-term support turned into ~2.74–2.80 (prior resistance), and failure below ~$2.55 could open a drop back toward $2.40. To date, NEAR has held above $2.70 as of mid-July. If Bitcoin and the market pull back, NEAR could retest $2.50–2.60 again. But on strength, analysts cite $3.21 and higher as next hurdles.

In summary, NEAR’s 2025 price action was range-bound for ~6 months, then broke upward in late July. The move was accompanied by higher volumes and funding rates, indicating a shift to bullish sentiment. Of note, technical analysts emphasize NEAR’s still-large drawdown from its 2022 all-time high (–87%), so any sustained uptrend would be a trend reversal signal. As one analyst put it, NEAR was “within striking distance” of its January 2022 high ($20), yet still needed broader market confirmation to sustain a rally.

Fortuna Insight for NEAR (AI-Powered Perspective)

This AI-driven insight synthesizes the above data to forecast NEAR’s near-term outlook. Given the recent technological upgrades and user growth, NEAR’s infrastructure advantages are becoming tangible. Its ultrafast block times and rising transaction volume suggest strong product-market fit for high-demand apps. If NEAR successfully implements the proposed inflation cut, its tokenomics will improve, potentially lifting long-term valuations. With Bitcoin and macro markets accommodative, NEAR could continue outperforming slower blockchains in the coming quarters.

However, risks temper the optimism. NEAR’s valuation (2nd-half 2025 price around $3) implies investor expectations of high adoption; any delay in governance or ecosystem expansion may lead to profit-taking. Competition from well-funded L1s (e.g. Avalanche’s subnets, emerging AI-blockchains) means NEAR must deliver on its key selling points (user experience, interoperability). The token’s technicals suggest a near-term resistance zone at ~$3.20–$3.50 – a test of whether the bullish breakout can sustain.

Looking forward, if NEAR continues attracting high-usage dApps (e.g. further mainstream fitness or AI platforms) and captures more cross-chain liquidity, it could retest all-time highs by late 2025 in a strong bull cycle. In a more conservative scenario, NEAR consolidates in the $2–4 range, gradually building value through real adoption and the upcoming protocol changes. In either case, NEAR’s positioning on the “AI + Web3” narrative could give it a unique premium among L1s, albeit subject to the broader crypto cycle.

Investment Potential

Upside Case

NEAR’s fundamentals and narrative point to a compelling long-term case. Its ability to onboard users at scale (46M MAUs vs. 10M for many L1s), combined with near-instant transactions and broad dev support, gives it an edge in real-world applications (DeFi, NFTs, AI apps). The upcoming inflation reduction (if approved) would make NEAR more scarce and boost yields. The Foundation’s deep treasury means the network is well-funded for marketing, grants, and research – crucial for growth. If Web3 adoption accelerates, NEAR’s performance advantage could attract projects away from congested chains, boosting its usage and token demand.

Value Drivers

Key drivers to monitor include active usage growth (more users and transactions), TVL expansion (especially if major protocols or stablecoins are built on NEAR), and regulatory clarity. Positive catalysts would be institutional integrations (e.g. NEAR ETFs or on-ramps) and continued innovation (AI/Web3 projects live on NEAR). The ongoing rollout of houses of stake governance and community-driven upgrades could also build confidence.

Comparative Edge

Compared to Ethereum (with high fees) or other L1s with slower finality, NEAR offers a technically robust alternative. It’s positioned to capture the wave of AI-driven dApps and large consumer Web3 experiences (e.g. move-to-earn, play-to-earn) that may struggle on less scalable chains. This specialized niche (beyond just “Ethereum killer”) could sustain higher valuations in a multi-chain future.

Given these factors, NEAR looks like a strong medium-term investment if one believes in the multi-chain and AI narratives. It is especially attractive if taken early in the bull cycle, before mainstream awareness spreads. Its tokenomics improvement (inflation cut) is a positive structural change, and its ecosystem shows real growth.

Weaknesses & Risks

Inflation & Token Dilution

The current 5% inflation (yielding 4.9% net increase) is high relative to usage. If the community fails to approve the inflation cut, NEAR holders will continue to face dilution, potentially capping price gains.

Centralization Concerns

A large portion of NEAR tokens and voting power resides with the Foundation, early investors, and validators. The Foundation’s treasury (305M tokens) implies significant control. While the treasury is a strength, it also poses concentration risk if governance isn’t fully decentralized. Past events (like the July 2024 RPC outage) showed the ecosystem’s reliance on foundation-operated infrastructure, exposing a single point of failure.

Competition

NEAR must compete with other high-performance L1s (Avalanche, Solana) and emerging chains (Sui, Aptos, Ethereum L2s). Many competitors are also courting AI use-cases. If one of them outpaces NEAR in developer mindshare or usage (e.g. a more vibrant NFT/game market on Solana), NEAR may struggle to differentiate.

Market Saturation

Despite growth, NEAR’s DeFi and NFT markets are still small. A slowdown in crypto market or shift in trends could impact network activity. For example, if Ethereum L2s successfully onboard users or if regulatory headwinds hit crypto broadly, NEAR could see reduced demand.

Past Outages/Incidents

While the blockchain itself is stable, the 2024 DNS attack on near.org highlighted dependence on centralized services. Any major protocol bug or network congestion (hypothetical) could damage confidence. Investors remember that high-profile chains (Solana, Avalanche) have suffered outages, so NEAR’s uptime will be scrutinized as activity grows.

Regulatory & Macro Risks

Like all crypto projects, NEAR faces macro risks. A prolonged bear market or crypto crackdown (on privacy coins, DeFi, or NFTs) could undermine its value. Furthermore, if regulators classify NEAR’s token as a security (unlikely, but possible in changing legal climate), that would introduce uncertainty.

Conclusion

In the first half of 2025, NEAR Protocol has made tangible progress toward its vision. Its network upgrades (faster blocks, improved consensus) and ecosystem events (developer programs, cross-chain integrations) have re-energized the community and attracted user activity. Adoption metrics (tens of millions of active addresses, hundreds of millions in DeFi TVL) underscore that NEAR is thrive-worthy: it is far from obsolete, and its unique blend of technology and simplicity continues to draw projects.

However, NEAR is not without challenges. The combination of market volatility, intense competition, and structural issues (inflation, centralization) means it faces headwinds. The mid-2025 rally shows investor belief in its potential, but the upcoming months will test NEAR’s ability to convert hype into concrete growth. If NEAR can maintain its momentum, improve its tokenomics, and capitalize on the AI + Web3 wave, it is likely to thrive in the next cycle. At a minimum, its robust fundamentals and dedicated community suggest it will survive, carving out a solid niche among Layer-1 blockchains.

Overall, NEAR looks poised to continue advancing – its recent developments and large user base give it a fighting chance to remain a major player. But as always in crypto, success will depend on execution: NEAR must deliver on its promises (faster upgrades, growing dApps) to truly thrive rather than merely survive in the dynamic blockchain landscape.