Author: 0xmonomi
In the last quarter of 2023, the NEAR protocol not only achieved significant success in technological innovation and market performance, but also occupied a significant position in the cryptocurrency field. As shown in the trend chart above, NEAR experienced particularly significant growth at the end of December. The circulating market value of NEAR reached $3.7 billion at the end of 2023 (a 245% increase compared to the previous period and a 246% increase year-on-year), while its fully diluted market value reached $4.3 billion. NEAR's market ranking rose by 10 places, from approximately 40th to 30th.
However, behind this series of positive developments, the NEAR Foundation suddenly announced layoffs, which sparked widespread discussion and speculation within the community. This article aims to objectively analyze NEAR's performance in Q4 and explore the possible strategic considerations behind the layoff decision.
NEAR's various data indicators in Q4 2023 performed excellently, and its global ranking surged to 25th place
According to the latest Q4 2023 report from professional data analysis firm Messari, the performance of the NEAR protocol in the cryptocurrency market is remarkable. Its steady growth in decentralized finance (DeFi), particularly driven by key protocols, resulted in a total locked value (TVL) of $128 million, a 147% increase from the previous quarter, and a rise to approximately 25th place in the global blockchain rankings. This significant achievement marks NEAR's strong growth in the DeFi field and the increase in its market influence.
The success of the NEAR protocol is mainly due to its steady growth in the DeFi field, especially the contributions of four protocols: Burrow Finance ($69 million TVL, 242% increase, 54% share), Ref Finance ($25 million TVL, 118% increase, 19% share), Orderly Network (decreased TVL but high activity), and Aurora Plus ($17 million TVL, 326% increase). These protocols not only have unique characteristics and advantages, but together they account for 91% of the total locked value on the NEAR network.
NEAR's decentralized exchange (DEX) also performed impressively in the fourth quarter. The total trading volume reached $400 million, a 237% increase from the previous quarter. This significant growth was mainly due to the substantial increase in the daily trading volume of the Orderly Network and Ref Finance exchanges. This not only demonstrates the liquidity and user activity of the NEAR network but also reflects its competitiveness in the cryptocurrency trading market.
NEAR's achievements in technological development are also noteworthy. In Q4, NEAR launched multiple innovative products and services aimed at optimizing developers' development experience and enhancing users' blockchain interaction experience.
FastAuth SDK Beta: This tool simplifies the blockchain account registration and login process for users, allowing them to register via email without needing to remember seed phrases or passwords, thereby enhancing account security.
Web Push Notifications: This feature allows developers to send direct push notifications to users, surpassing the limitations of traditional in-app notifications and enhancing real-time user engagement.
NEAR Query API (Beta): As a serverless solution, it provides developers with NEAR blockchain indexers, storage, and GraphQL endpoints, simplifying the interaction of blockchain data and application development process.
Layoffs are likely not due to poor financial conditions; NEAR is likely to make multiple adjustments to its development strategy
Despite NEAR's significant achievements in technological innovation and market performance, the sudden announcement by the NEAR Foundation on January 11 to cut approximately 40% of its team undoubtedly came as a surprise. This restructuring announcement not only attracted widespread attention in the cryptocurrency community but also sparked deep reflection on NEAR's future development direction.
According to the financial report of the NEAR Foundation, the foundation's financial condition is quite robust. The report shows that the foundation holds over $285 million in fiat assets and NEAR tokens worth over $1 billion. With such financial reserves, it is theoretically sufficient to support the foundation's long-term operation and development. Therefore, it can be inferred that the decision to lay off employees is not due to financial pressure but is more likely based on a reevaluation and adjustment of future strategic direction.
Next, let's interpret the new direction and planning of NEAR's strategic adjustments, in order to provide more investment value references for the general users. We believe that NEAR's future development may move in the following directions:
Focus on core business: In the rapidly developing blockchain industry, effective allocation of resources is crucial. The NEAR Foundation may be reevaluating its business focus to ensure that resources and attention are concentrated on projects with the most potential and those that best align with its long-term vision. This may mean stricter prioritization of existing projects and possibly cutting projects that no longer align with the core strategy.
Strengthen technological innovation: NEAR has been known for its technological innovation, especially in data availability (DA) and chain abstraction. The layoffs may be aimed at concentrating more R&D resources in these key areas to accelerate the development and market promotion of critical technologies.
Improve operational efficiency: In any organization, as it scales, improving operational efficiency often becomes a challenge. The NEAR Foundation's decision may aim to simplify the organizational structure, improve decision-making efficiency, and enhance its ability to respond to market changes.
Long-term development in the market and community: The NEAR Foundation may be seeking to strengthen its influence in the market and community through more concentrated resource investment. This may include strengthening cooperation with the developer community or establishing a stronger brand and user base in specific market areas.
Increased investment in data availability (DA) and other technical routes by NEAR may have an impact on the overall performance of the project
The NEAR Foundation's decision may indicate a shift in its business focus to certain specific products or services. For example, the development of NEAR in data availability (DA) is worth noting.
NEAR's introduction of the NEAR Data Availability (NEAR DA) layer aims to provide more efficient and cost-effective data availability solutions for Ethereum rollups. This technology's launch not only demonstrates NEAR's strength in blockchain technology but may also become a key focus of NEAR's future development.
In addition, NEAR's efforts in chain abstraction are also worth noting. By simplifying the user experience and enabling seamless trading and interaction across different chains, NEAR is striving to expand its user base for decentralized applications (DApps). The implementation of this strategy may require more resources and focus, explaining the NEAR Foundation's decision to restructure the team.
The recent layoffs by the NEAR Foundation may indicate a significant shift in its business focus. This shift is primarily evident in two key areas: data availability (DA) and chain abstraction.
The introduction of NEAR Data Availability (NEAR DA) is a clear indication of this shift. This layer aims to provide a more efficient and cost-effective data availability solution for Ethereum rollups. In the current blockchain ecosystem, data availability is a core issue, especially for applications seeking scalability and high throughput. The launch of NEAR DA not only demonstrates NEAR's strength in addressing this critical blockchain technology challenge but also signifies its strategic focus in the blockchain infrastructure field.
The successful implementation of NEAR DA may have far-reaching implications for the entire blockchain ecosystem, especially in promoting the development of rollups and other layer 2 solutions in the Ethereum ecosystem. By providing a more cost-effective data layer, NEAR can not only attract more developers and projects to its platform but also strengthen interoperability and synergies with other major blockchains such as Ethereum.
NEAR's efforts in chain abstraction also demonstrate a shift in its business focus. Chain abstraction refers to hiding the complexity of the blockchain, allowing users to trade and interact across different chains through a simple, unified interface. This approach can not only improve user experience but also lower entry barriers, attracting a wider user base to the world of decentralized applications (DApps).
NEAR is striving to achieve this goal through various tools and services such as FastAuth SDK and NEAR Query API. These tools aim to simplify the workflow for developers, making it easier for them to build and maintain DApps on the NEAR platform. At the same time, these tools also make it easier for end users to access and use these applications, regardless of their technical background.
The NEAR Foundation's decision to restructure its team may be aimed at concentrating more resources and attention on these key areas. By focusing on data availability and chain abstraction, NEAR can not only solidify its position in the blockchain infrastructure field but also make significant progress in the adoption and user experience of decentralized applications.
Opportunities and challenges coexist, and the older project NEAR still needs to be observed to see if it can become a top player in the public chain industry
With significant achievements in the fourth quarter of 2023, the NEAR protocol's position in the blockchain field is becoming increasingly solid. Its strong growth in DeFi and DApps, coupled with technological innovation, has made NEAR an important participant in the cryptocurrency market. However, the recent layoffs by the NEAR Foundation reveal a deeper strategic shift that may have a significant impact on NEAR's future development.
The restructuring of the NEAR Foundation may indicate a reevaluation of its business focus, especially in the key areas of data availability and chain abstraction. This shift not only reflects NEAR's sensitivity to market trends but also demonstrates its determination to adapt to the rapidly changing blockchain environment. The launch of NEAR DA and continued investment in chain abstraction are expected to bring new growth opportunities for NEAR and may also bring innovation to the entire blockchain ecosystem.
Despite the challenges of internal restructuring, the NEAR protocol continues to demonstrate strong market adaptability and potential for technological innovation. In the future, whether NEAR can achieve its ambitious goals in key areas such as data availability and chain abstraction will be the focus of the blockchain community. As NEAR continues to strategically invest in these areas, its position in the global blockchain market is expected to further consolidate and improve.
In conclusion, the future of the NEAR protocol is full of opportunities and challenges. As the market continues to evolve and technology advances, NEAR needs to maintain its core strengths while flexibly adapting to new changes in the market and technology to achieve its long-term development vision.
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