Penta Lab research report: NEAR - 114% potential for market value growth

Source: PentaLab

The AI ​​background team promotes high-performance public chains to catch up with Avalanche

Project name: NEAR Protocol

Token: NEAR

Current market value: US$6.65 billion

Estimated market value in 6 months: US$14.26 billion

Room for upside: 114%

Penta ten-dimensional score: 83

Data as of: March 20, 2024

Download the full research report: https://t.me/pentalabio

Official website: pentalab.io

The star team creates Night Shade with the largest theoretical TPS. The core technology of Near Protocol is Night Shade sharding technology, which divides all transactions contained in each block into fragments and divides them into various validator nodes. Each node no longer participates in all transactions. processing, instead only validating transactions and status related to shards. Therefore, Near Protocol can break through the limitations of the processing capacity of a single device, so that the number of transactions per second (TPS) can theoretically reach a maximum of 100,000. In response to the reduced security problem caused by sharding, Near not only randomly assigns validators so that malicious nodes are not on the same sharded chain, but also sets up many hidden validators on the chain, and they do not know each other's presence. Which shard to ensure the security of the entire chain.

High-performance cross-chain bridge Rainbow Bridge and Layer 2 expansion solution Aurora jointly achieve good support for multiple chains. As the first batch of permissionless, decentralized and open cross-chain bridges, Rainbow Bridge supports any user to deploy, use and maintain new cross-chain bridges, and can connect multiple blockchains including Ethereum. , effectively reducing transaction confirmation time and transaction costs. In addition, NEAR's Layer 2 extension solution Aurora further improves the interoperability and scalability of the protocol. Aorura Engine allows Ethereum smart contracts to run on NEAR, and Aurora Bridge supports the transfer of ERC20 tokens and ETH between Aurora and Ethereum. Currently, Aurora's block generation time is 1 second, transaction confirmation time is 2 seconds, and transaction fees are as low as $0.02. The ecosystem already contains 209 protocols, including many well-known projects such as Curve and The Graph.

The development path is clear and comprehensive, and seven-dimensional upgrades are expected in the future. According to the roadmap given by Near Protocol, upgrades will focus on the following seven aspects: stateless verification, congestion control and transaction priority, support for account aggregation, zkWASM, data availability improvements, Ethereum wallet support and research analysis. The future of film. The project team is committed to improving the experience of users and developers, while improving the scalability and decentralization of the protocol, and has made clear plans and layouts for the continued development of the protocol in the future.

Valuation: Benefiting from the promotion of AI seminars at Nvidia GTC, Near’s current circulating market value/TVL has reached 29 times , is the highest among the top 30 public chains in terms of market value, and is also at the high end of history. Analyzing Near's current TVL of 260 million, it is mainly Burrow, which accounts for 70%, and Ref Finance, which accounts for 22%. We assume that Burrow and Ref Finance's six-month TVL will increase by 70% and 50% respectively to US$300 million and US$86 million. USD, other AI, GameFi, and RWA potential projects have brought an incremental TVL of USD 100 million, with a six-month TVL forecast of USD 490 million. Further based on the current 29 times circulating market value/TVL, we get a six-month target market value of US$14.26 billion, which has 114% room for growth compared to the current market value.

Main risks:Market competition risks, technology development falling short of expectations.