Hack the Rainbow: NEAR 101 – The Very Basics

NEAR 101 is the base level introduction to the technical facets of NEAR protocol. This talk was given to prospective developers interested in building applications on top of NEAR. The talk was a comprehensive overview of key topics related to building solutions on top of NEAR: Accounts, Programming Languages, the differences between Web2 and Web3, and Cross-contract calls (among other topics!). 

Slides for the original presentation on NEAR 101 can be found here: bit.ly/near-101

Point 1: NEAR Inaugurates Web3: How Does that differ from Web2? 

As the graphic above demonstrates, NEAR protocol represents an initial foray into the development of Web3: Web3 is commonly referred to as The Internet of Value. It is the next iteration of internet innovation, insofar as it builds in money to base level protocols. Because of this addition, accounts must also be secured using asymmetric key pairs. 

Sherif explains the main differences between account security in Web2 and Web3: 

In the Web2 world you use oAuth or username to log in to some environment, as opposed to Web3 where accounts are asymmetric key pairs (public and private keys). Your private key is really your password, but strictly it never actually leaves your machine. With Web2, if for instance, you’d log in to Facebook, your username and password travel through the web and then land on some remote server where they get checked and verified. However, you’re still sending this data over the wire, so technically a bad actor could still intercept this and do bad things. This can’t happen with Web3, since you own the private key and sign the message. Servers on web3 (as opposed to AWS / GCP / Azure on Web2) are different from web2: they’re nodes and the consensus secures the network itself. 

Point 2: NEAR Has Two Path Extensions

When it comes to building things on NEAR protocol, Sherif explains how NEAR has two primary extension pathways for developers: 

These two development pathways, reflect the primary focuses of NEAR protocol itself: Scalability and Usability. While developers do not have to worry about the technical details of sharding, they can build contract-based solutions that benefit from low transactions costs and high speed transactions using NEAR Software Developer Kits (SDKs). Meanwhile, Usability can be improved for any dApp using the NEAR API and the JSON-RPC API. 

“When you’re building on NEAR, you have to take into account two areas of development: one is the contract you’re building on the other is the user experience.”

Point 3: Use AssemblyScript for Fast Prototyping and Rust for the Big Leagues

When discussing the dApp contract development pathway on NEAR, Sherif explains the benefits of building through the different SDK’s connected to NEAR: Developers should use the AssemblyScript SDK for fast prototyping and initial project development. However, serious, high-value applications should be built in Rust as the more durable and secure solution. As Sherif explains: 

Again, AssemblyScript  (near-sdk-as) is great for prototyping and great for starting out, but the language is still maturing and as the AS community continues to build and grow, it may grow more stable, but honestly I don’t recommend to build applications that hold a lot of value. For a hackathon, AS is great. It is fast, but if you are building an actual application that’s going to be holding a decent amount of value, then Rust is more sophisticated and reliable.

Notably, on all NEAR applications the frontend and backend do not have to be programmed in the same language. For instance the frontend can run on JavaScript, while the backend runs on Rust.

Point 4: NEAR Accounts are Easy to Setup and Manage

The fourth and final point of the introduction to NEAR centers on Accounts. Accounts on NEAR are different than on Ethereum: An account can represent either a user, a contract or both. In this sense there can be a Master account and sub-accounts. In addition, NEAR accounts do not use hashes – they are instead human readable names that follow a DNS reading pattern. Last but not least, NEAR Accounts also maintain their own storage through the passive storage staking functionality. Sherif specifically breaks down the nature of storage on NEAR:

In terms of storage, if my account is going to keep data store then I need to stake some tokens to offset the maintenance costs of keeping that data on your account. Effectively what youre doing is, you’re taking some tokens out of circulation and you stake them against that data you’re storing and that increases the relative value of other tokens (deflationary mechanism) so that other people who hold tokens are now marginally more valuable, so rewards are more valuable for maintaining integrity of the network. So if you store data, you’ve got to put some tokens against that data, which says “I want to keep this data” and I’m locking these tokens against that data. As soon as you delete the data you get the tokens back. But as long as the data is there and someone, some node, some computer, some hardware, or resource has to be consumed to keep that data around, then you have to stake tokens against it, and this article explains that: https://docs.near.org/docs/concepts/storage


As an introduction to NEAR protocol, Sherif’s presentation helps developers get started quickly on building their first Web3 applications. While the rest of the discussion featured Questions and Answers as well as a long discussion on the nature of cross-contract calls and sharding, the main points for developers remain the same: NEAR is easy to build on – in either AssemblyScript or Rust – it inaugurates Web3, and its primary features put Usability and Scalability first, whether that is on the front-end with Human Readable ID’s, or on the back-end with easy to build prototypes with the AssemblyScript SDK or robust applications in Rust. 

Hack the Rainbow Session 11 – DeFi in the Wild: Fair Distribution and Accessibility

Session 11 of the NEAR Hack the Rainbow Hackathon featured a high level discussion from a number of big names in the DeFi industry: Mariano Conti from YFI, Marc Zeller from Aave, and Joe Gerber from IDEO. Among other topics this session featured a big picture overview of the state of DeFi – the most important trends affecting the industry, and expectations from everyone on what is to come next! 

Point 1: Fair Launch Capital Is Trying to Mix Things Up For Funding Projects 

Joe Gerber began the session by explaining the new community-run crypto platform he is launching known as Fair Launch Capital. According to him, the guiding vision behind the project is to find an equitable way to fund projects so that everyone stands to benefit: Founders, Long-Term members, and whales of course. The only problem – It is a process in figuring out exactly how this is possible: 

“I’ve heard the word fair so many times and we can see from release of YFI everybody thought it was fair. However, it was still a whale’s game. Is it fair for whom? Is it fair because it is distributed far and wide? Is it fair that the team that spent years building something has to rely on the community? There are so many nuances to fairness. We got the influx of meme coins and food coins, which I don’t count in all this, but I am intrigued to see where do we go with all this.”

Point 2: Is the Uniswap Air Drop a sign of things to come? 

Yalor, who helped moderate the panel, started the next topic off with one of the most insightful observations of the power of DeFi to date: 

These mechanisms that we are creating and experimenting with now are very innovative. For example, Uniswap dropped more funds to its users than the US government dropped to its citizens in the form of a citizen check. If more projects and organizations will start doing this, it will be an engine of funding for individuals doing things inside the DeFi ecosystem. What do you guys think?

The retroactive airdrop from Uniswap showed the future of DeFi, as well as the opportunity to leverage crypto as a foundational model for Universal Basic Income. Joe added this point about the Uniswap drop:

This shows the power of DeFi and its power to change the world. A USDT stablecoin in an environment with inflation is a gamechanger. People all over the world have new and different opportunities. The second interesting thing is that Uniswap dropped the coin retroactively. This means that the people that were using the product because they liked it and not because they thought that they would be rewarded. And that seems very fair to me. I think more projects should follow that path and drop the tokens retroactively. 

Point 3: Mass Adoption and Community Contributions Start on Layer 2! 

Perhaps one of the most insightful points from the talk was the discussion about future contributions to DeFi and mass adoption. What was the general consensus? That it will start on Layer 2 solutions building on top of (and even across) Layer 1 protocols. Not only is this an interesting insight in it’s own right, but it also holds important repercussions for the future development of NEAR protocol in the context of Decentralized Finance. Marc chimed in for this one: 

 “Mass adoption can only happen on Layer 2, more than 80% Ethereum users in the future might not interact with layer 1 and I am completely fine with that. They don’t have to, they can insert fiat into yield farming through a bridge, no need to interact with layer 1. With Aave we have quite a community in Argentina, we have a lot of community there that got some DAI and deposited it in Aave, and we are working on the solution to make these people pay less gas fees, and the solution is to make them interact with Layer 2 directly.”

The power of this response in the context of the NEAR-ETH Bridge is the following: NEAR will soon have the capacity to contribute to the evolution of DeFi by offloading ETH applications – that are still built on ETH – but are looking for cheaper transaction fees to scale more quickly. The technical foundations of NEAR paired with the current limitations of ETH make this an exciting time for NEAR protocol. 

For more detailed Notes on the Talk See Here

Hack the Rainbow Session 7: NEAR Accounts and Key Registration

Hack the Rainbow Session 7, led by Matt Lockyer and Sherif Abushadi, was a technical deep dive into the world of Accounts, Keys, and the differences between NEAR and Ethereum. While a full transcript of the main points of this discussion can be found here, this general overview outlines some of the most important and fascinating areas of Account and Key Management on NEAR. 

Point 1: NEAR Accounts Differ From Ethereum In Some Crucial Ways

The session started out by clearly delimiting the primary differences in which the account system for NEAR differed from that of Ethereum: On NEAR it’s all about Accounts as opposed to Key Pairs. NEAR has ENS built into its protocol, with the result being that Account Names are standardized as matt.testnet , or sharif.testnet and are not generated automatically for you. It is then up to the account administrator to deploy a contract for an account or subaccount. 

As Sharif Explains:

“The account name can be any valid account on the network that you create. You can create it first, and then deploy a contract towards it, or you can create an account as part of a transaction – create an account and then deploy the contract.” 

Meanwhile, the primary differences between Accounts on NEAR and Ethereum are summarized in the graphic portrayed below: 

Point 2: Accounts and Subaccounts on NEAR

Uniquely, NEAR offers users the capacity to create not only an account – but also sub accounts as well. The Master account can then manage the permissions of the subaccount. 

Essentially there are accounts and subaccounts: you can create sub accounts, and have another account be the master account.”

Importantly, there is no primitive action for Master accounts to ask for account information on a contract:  

“You can add keys or delete keys from inside of a contract – when you say can an account do something – the next question is – do we support the ability to ask another account for keys that it has? I don’t think we have a list keys action. You can add a key, delete a key, call a contract, list function, add account, create account, send tokens, transfer or stake, those are the eight primitive actions that we have got. So there is no primitive action from within a contract to ask for account information on a contract.”

Point 3: Function-Call Limited Permissions – What are they? 

In perhaps the most complex part of the discussion, Sherif asked Matt to explain the main idea behind Function-Call Limited Permissions. Essentially, in NEAR accounts, Master accounts can call-certain contracts from sub-accounts using a function-call key. The following example was provided during the session: 

“Let say we have two accounts, Alice and Bob (.near each). It is true that Bob can call a function-call key that has a receiver of Alice and is only scoped to call methods on Alice. So through some sort of construction, whether it is in the CLI or whether it is in a contract or using NEAR API JS and the user approves that transaction – Bob can add a key to that account. So Bob would have this function call Key with the receiver of Alice – and it is scoped to a particular method – and Bob would have approved some sort of allowance.

As tricky as this concept can be to understand, by differentiating accounts from keys, NEAR’s design allows accounts to call contracts on specific sub-accounts:

It is important that we understand the two main concepts: Accounts and then the key pairs are added to the accounts under various permissions, but there is almost like a pseudo concept with these automatic function calls, and that is who controls the private key once you’ve added a key pair with some allowance to call some functions?  That opens up this whole other world of possibilities: For example, I could create an API and people could deposit funds to my contract, to get a key that allows them to add a key to my account, so you could add a key to my API contract, that basically gives you an allowance to call a certain number of functions. So this becomes really interesting because who has the private key is the one who can call that, on the accounts behalf. 

Point 4: An Auction for Top-Level Account Names Is In Store For the Future

A final point to keep in mind on the topic of NEAR accounts is the upcoming – yet still not defined NEAR Auction for Top-Level Account Names. In essence, the .NEAR behind each account will eventually be customizable to specific account names that users can bid on for themselves! 

As far as I know we haven’t made any hard and fast decisions about what is going on with TLA’s – Top Level Account Names – so as of now everyone has to create a something.near account. In the future it will be an auction. NEAR will host a very fair and open auction for TLA’s on NEAR – Top Level Accounts – and then you can deploy a contract on the Account that can govern how you will sell sub accounts. How will users create matt.theoforec. Top level accounts will be auctioned off at some point in the future. 

For a full breakdown of this discussion you can check out the notes from the talk available here

Hack the Rainbow Session 5: Mintbase, NFTs and the Path to NEAR with Nate Geier

Session 5 of the NEAR Hack the Rainbow Hackathon featured a high level discussion between NEAR’s NiMA Asghari, and Mintbase CEO Nate Geier. They discuss the development of NFT’s – starting from the basics, and move into different use-cases, the technical design of Mintbase, why Nate chose NEAR, and much more! 

For an abbreviated transcript of the notes taken from this session click here.

Point 1: Introducing Non-Fungible Tokens (NFT’s)

At the beginning of the discussion, NiMA and Nate start off by talking a little bit about the history and nature of Non-Fungible Tokens. As Nate explains, the first NFT was created on the Bitcoin blockchain, but the one that made NFT’s go mainstream was CryptoKitties. When discussing NFT’s Nate explains them broadly as ‘anything that is not money tokenized into a single form.’  While the fundamental value proposition of NFT’s is discussed as being based upon demonstrating ownership of a unique object or asset. As Nate Explains: 

“Blockchain is getting really excited about two things – it is getting crazy with DeFi, and then NFT’s which is basically everything that is not money tokenized into a single form. Coffee, Artwork, Tickets, anything that is not as fungible of money. For things that have a finite number, or one, it makes more sense to use NFTs. If you want to show ownership for a thing. To show that true ownership of it – which we are seeing in crypto voxels – then that is your property and you can put it on open-sea and set it for auction. That is the microcosm for real property in the future.” 

Of particular importance is the wide diversity of applications that Nate envisions NTF’s to have in the future: From Coffee, to Artwork, to Tickets, to property, Non-Fungible tokens are emerging as a new class of digital tokens with serious real world applications. 

Point 2: The Origins of Mintbase: 

Mintbase was created by Nate Geier shortly after participating in the DevCon4 Hackathon. According to the panel, Mintbase has been named on Dapp Radar as being “One of the largest marketplaces with the most users.” This is because as Nate explains: 

“People don’t recognize mintbase as being that massive because you could be using Mintbase without knowing it. A lot of the mint on our platform exist in other spots.  Mintbase has over 73,000 transactions through their system.”

Beyond operating as the base layer for minting NFT’s, Nate explains how Mintbase allows each of its Minted NFT’s to also contain music, sound, and legal documents pegged to the NFT in such a manner that it cannot be changed by any party involved in the creation of the NFT itself. 

“Music has been the latest thing, a lot of people have been minting music. We enable people to mint multiple files through a single NFT so it’s not just a single part you have in it – it’s your art, and maybe your legal documents are also pegged to it.” 

Point 3: Why Nate Chose NEAR:

As the conversation developed, Nate opened up to the community about his decision to move to NEAR. The crucial factor? Gas fees on Ethereum. As Nate explains: 

“It is kind of weird having your dreams crushed by Ethereum a little bit. You have this vision, and you know the community and technology pretty intimately and it feels like your best buddy sometimes, and then you spend so much time and effort on a thing that finally got working – building blockchain Apps is super hard. Making it in a way that is a well oiled machine – then seeing gas just skyrocket is a moment of saying – I just spent all that time building an App that might not be that effective. It was a hard last couple of months.”

Upon deciding that he needed to migrate Mintbase off Ethereum Nate describes the process of choosing NEAR, as ultimately being based on coding in Rust on a dynamically sharded blockchain. According to Nate, NEAR’s capacity to scale was one of the key reasons for his choice to build on top of it: 

“The benefit of sharding the obvious one is state bloat. Everyone stopped having the conversation that ETH 1 ran into called State bloat. Everyone is just throwing a bunch of stuff into state, and we have to run a node that copies all of that stuff. It’s too big. So eventually machines will not be able to copy all of that stuff into infinity. A lot of applications like xdai will also run into this issue. 

To handle this, you either need to get massive machinery like Solana to do all of the copy, while sharding breaks the chain out into a bunch of different areas. So in the future when Mintbase gets massive, parts of one app will be on one shard, and parts will be on another shard. It seems like they handle it pretty relevantly in Rust.” 

Point 4: The Future of NFT’s and Industry Disruption

A final point that is both exciting and in the process of being fully developed, is the future of Non-Fungible Tokens in the crypto-sphere and beyond! Nate specifically mentions the applicability of NFT’s to voting and tickets, art, the meta-verse land of crypto, and most interestingly NFT’s for validator node interest: 

Nate on Ticketing and NFT’s: 

“NFT’s are really going to start shining when using voting and tickets with NFTs. You can buy the ticket using a decentralized currency and go to an event. But as soon as you say there is an open API anyone can interact with to create voting apps or ecosystems, then you can add things by saying, anyone who has a DAppcon ticket can cowork at our space as well – this is really exciting.” 

Nate on Art NFT’s: 

“Another thing that is pioneering is royalties – we have never been at a time when an artist can sell their art, and continue generating revenue as it moves throughout markets. This is why people are getting excited about Art – we have a programmable piece of item for other things.”

And finally, perhaps one of the most innovative ideas in NFT’s to date: NFT’s for State interest on different networks: 

“Mark just minted an NFT that allows you to accrue your states interest, if you are the owner of that NFT. So if you want to give that NFT to your friend for christmas, then they can start accruing the interest. The owner of the NFT is the staker – the Aave staker. The NFT offers portable stake pieces that can be shared or loaned out. DeFi NFT stuff is the next frontier.”

Notes taken from this session can be found here

Hack the Rainbow Session 10: Market Driven and Product Ecosystem Development Panel

The Session 10 Panel of the NEAR Hackathon featured three crypto veterans discussing the current state of product development in the Crypto market, expertly moderated by NEAR’s Matt Lockyer. As a commentary on the state of cryptocurrency development in general, and specifically different project opportunities on NEAR there were a number of important insights revealed over the course of the panel. 

For those looking to read the full transcript of this discussion, it can be found here

Context: What Was This Panel All About? 

As the title suggests ‘Market Driven and Product Ecosystem Development’ is a panel on the current state of application development in the blockchain space – and how founders can identify market opportunities for their solutions. Topics discussed ranged from outreach strategies, to killer applications, to the step-by-step process of building and moving to market. 

Point 1: How Can We Differentiate Real Market Signals From the Noise in the Crypto Space? 

One of the most important questions asked was about how product owners can expect to actually gather valuable feedback on the development of their product and it’s fit in the market. According to Matt Cutler – Co-Founder of Block Native, there were two things they identified based off of copious amounts of experimentation: Memes and Direct Engagement. 

“One that is really surprising is that communicating in memes is a lot more effective than anything else, we hired someone young who is called meme lordy. The level of engagement on a meme is why they are memes. The other one I would say is direct engagement – build something, prototype it, and show it to somebody. My experience is, that it is not subtle and if they don’t like it, people will be pretty direct with you and say I hate it, that’s dumb, I would never use that. If they love it, they will leap across the table and say this is it. And if they don’t care they will say, that’s cool and interesting. Listening very carefully to that reaction, and then when someone jumps across the table and says, this is it – listening to what they are responding to – because every time I do this – what I think is interesting, and what I think my customers think is interesting – are different.”

 For Zach Herring, currently with Consensys Relays, a further important indicator when launching a product stems from the need to identify where the real value lies: 

“To me, the danger is whenever you are showing people a prototype, the danger is to not think about the social context about that. If you wrote a song and then showed someone what you think of it, they will probably say that is pretty interesting. You will probably hear the same thing for a prototype – leaping across the table is a really good judge on a prototype. I tend to write my usability scripts with some sort of call to action in the last part. Then you either leave a call to action of some sort of value exchange at that moment – would you introduce me to five other people who would be interested in this product? Would you be interested in signing up for a beta test of this product? To me that is the fastest way to start proving that you are building something valuable.”

Point 2: Product Market Analysis Altered the Development Course of NEAR

According to Sasha (i.e. Alexander Hudzilin), NEAR’s product market analysis began by talking to as many people as possible about what the underlying value of the NEAR Ecosystem would be. Originally, the NEAR team had focused on scalability – via Nightshade and dynamic sharding. However, after feedback from possible users and investors, a further value-characteristic emerged: Usability. This at the end of the day, is why NEAR is so focused on Developer benefits and ease of use for Users.

“NEAR started really hard on scalability, and then moved into usability. High fidelity feedback with interviews with people helped get us there.”  

Point 3: Is There Already A Killer App in Crypto? Matt Cutler Thinks So

One interesting question asked, centered on the notion of a killer application: The app that get’s everyone interested and aware of crypto in one way or another. Sasha’s initial answer focused on the need to bring entrepreneurs into the space. He also mentioned the importance of adoption and the current growth of projects like Audius (Music Streaming Service) as a first step into the world of blockchain applications that are widely adopted. 

Sasha’s Take:

The question requires entrepreneurs entering the space. In order to get to a killer app, I think you need to have some of the skills that you can measure by adoption. A music streaming service – Audius – is one that is growing really fast 30% month to month – which also happens to have an economy on top of it. Music is just one example, and hopefully it will be inspiration for podcasting, art, and other music communities. This is the closest I see to a killer app right now.” 

Matt however already believes that there is a killer blockchain application: Stable Coins. As he explains in detail – Stable coins are the foundation of DeFi, and unlock an entire world of cross-border transactions for people traditionally not involved in crypto. 

Matt’s Take:

“The killer app is already here and there is already good evidence of it. They are boring but they are stable coins. The big things holding back this ecosystem was the underlying volatility and mental overhead of  asset volatility in various cryptocurrencies. Once you remove that, and you have just a programmable dollar, this is the foundation of DeFi. The DeFi revolution doesn’t really happen without stable coins. 10 years from now we’ll look back and say that was the thing that already unlocked it all.” 

Point 4: The ‘Normies’ Will Come When There Is Easy Access To Value

‘Normies’ refer to those normal people who aren’t familiar with crypto and don’t understand the future development of the space. In the context of product market fit, it remains important to appeal to the ‘masses’ for widespread adoption. The question posed at roughly the 25 minute mark was simply: How do we bring in new people and how do we look at Normies? What are the tactics there? 

Sasha, Zach and Matt all add interesting perspectives on the topic: For Sasha, a large part of it revolves around the need to make crypto easier to understand for the average person, in parallel to the need for further education: 


“A lot of it comes to education. We need to throw all of the DeFi lingo out of the window. A lot of people cannot get into DeFi because of new words and vocabulary for learning it. We need to reduce the cognitive log and remove the language we use today to explain to people what we actually do. We need people who can break down things in a plain english way.” 

Zach added on to this point that, Crypto definitely needs to be made more easy to understand for the average Joe: 


There is a lot of distaste for the corporate structure. DeGen slang replicates that. There is a level of impermeability to the nomenclature we are using. I would fund a Gitcoin grant, for explain it like I am Five on DeFi concepts.” 

Matt response to the question took a larger macro perspective to the cryptocurrency industry, and analyzed it in the context of skillset and the opportunity presented by DeFi: 


“I see this as a massive game, where you have skills levels and a bunch of things that come with that….The normal way of thinking is: Go to school, learn how to code, get a job, make money. Now it is: Go to school, learn online, learn crypto, don’t get a job, make money. You can skip the whole get a job part. It is no longer indirect. Get good at this game, make money. The middle step is eliminated in DeFi. I think that is going to be the whirlpool that sucks everyone in.” 

Point 5: Participants and Builders in Crypto Are Often Times The Same People, Will That Last? 

One final, and important point to note is the current state of development of the cryptocurrency user base: Right now, most users in crypto are also investors, founders, or actively building out different areas of the crypto ecosystem. As Zach and Sasha discuss, this has important implications for testing the market: Put simply, testing the market is all about joining communities and conversing openly about the space, what is under development, and where value may be residing. 

Zach’s Take:

First off, because so much of crypto twitter – the people who are building are also the users – this is kind of unique. You couldn’t necessarily talk about designing products. One of the first ways to test the market is to start engaging in the conversation. It teaches you a lot of the nomenclature that people are using – it teaches you that if you are up on the language it speeds up the time you have to communicate the concepts you are playing with. It gives you a really rapid way to test ideas.” 

Sasha’s Take:

There are definitely telegram groups or discord channels out there where you can find early users or early adopters. It is a great place to interview people and understand where they are coming from. So many users are builders of the futures not the bug of the ecosystem. The insular nature of what we are building is accelerating development, and is an early leading indicator that we are on the right track of the ecosystem. For the average user, the traditional retail investor – we aren’t quite there yet, but that is okay. They will come along as we continue to build the building blocks out and enable new experiences.” 


As one of the best talks of the entire Hackathon, the panel on Product Development is an important ‘watch’ for any person interested in launching their own product in the crypto space, or in better engaging existing crypto-users to define a market fit. With a bright future for blockchain applications, DeFi, memes, and crypto builders, there is much to look forward to in the industry as it starts to become more and more popular to ‘Normies’ all over the world. 

A full transcript of the talk can be found here

Hack the Rainbow Session 1: Justin Drake and Illia Polosukhin – Grilling the Rainbow

The first session of the NEAR Hack the Rainbow Hackathon featured a high level discussion between Justin Drake – a leading researcher working on ETH 2.0, and Co-Founder of NEAR Protocol, Illia Polosukhin. 

This session was special for a number of reasons: 

For one, it marked one of the first public dialogues between two Layer 1 protocols that will play a seminal role in defining the future development of cryptocurrency. Second, there were a number of interesting details pertaining to NEAR’s sharding design, the larger goal of the Rainbow Bridge, and long-term NEAR-ETH opportunities. 

The general topics discussed ranged from the nature of blockchain protocols, to the future of crypto, the need for interoperability of assets in a decentralized manner, and the importance of state security as blockchain-ecosystems expand! 

Note: Full Transcript of the session can be found here

Point 1: The Point of NEAR is to Free Developers To Build and Users to Engage – Blockchain Technicalities Aside! 

Dynamic sharding on NEAR ultimately means that developers and users can leverage the full benefits of blockchain without having to worry about how their transaction is validated among all of the others. Illia’s answer indicates that the sharding design of NEAR ensures that the development of shards on the network in relation to the main-chain lifeline is a parallel feature to what users and developers can build and deploy: Validators and chunk producers need not worry about Apps or Users, while such stakeholders can grow their own solutions without worrying about the stability of the blockchain they build upon. 

Illia’s Take:

“The whole point of NEAR is that as a developer and a user, you don’t need to know about shards at all. Like literally 1 shard, 4 shards, 100 shards, it is fully transparent to the user, and there are multiple reasons why this is done. What this allows us to do, is it verifies the main chain lifeline – all of the shard information get’s aggregated in the main chain. As the chunks are produced, their head is included in the block and then the block has in that header all of the aggregated merkle of all the transactions across all the shards. So now you can prove any event, anywhere in NEAR on any shard, from like one lifeline.”

Point 2: Applications From The Bridge Are Coming

Justin asked Illia the following question: What are the main applications that you are interested in? What are the main motivations for you to build this Rainbow bridge so early, even before you have activated deposits even?  Illia’s response is telling: The Bridge is meant to help facilitate the transfer of assets from Ethereum that can be used to bolster development on NEAR. Whether that is in terms of liquidity, access to DeFi, NFTs or other forms of arbitrary communication. Notably, there is also an opportunity for Ethereum teams to use the bridge to bolster the usability and effectiveness of their own applications on NEAR, while still keeping the project itself on Ethereum. 

Illia’s Take:

“So a bridge is a way to bring these assets that are originating right now on Ethereum – and bring them to NEAR and unlock all of these abilities. Obviously as this progressed, there are a lot of applications that might have originated on Ethereum but don’t fit right now in the current paradigm of financial craziness. They need a home that still connects to Ethereum because there is still more liquidity there even for non financial assets like NFT’s or some other things. So this bridge can also host arbitrary communication – sending other types of data information – which NFT’s are, and this was also in its purview. So in reality, as it progressed, we kind of realized this can become a platform to really connect with Ethereum and provide all of the functionality that people want early on especially coming from Ethereum, kind of on NEAR – while we still can develop in the Ecosystem.”

Point 3: The ETH-NEAR Bridge is a Win-Win Initiative For All of Crypto

Perhaps one of the most important points to remember from the entire discussion, is that even though Ethereum and NEAR are considered Layer 1 Protocols that offer similar services, they are not necessarily competitors! Rather, as both Illia and Justin confirmed, the ecosystems can mutually benefit from the development of one another: They can learn from the successes of one another, while collaboratively offering decentralized services that will change the fundamental structure of finance, data privacy, and ownership! 

Justin’s Take on This:

In general, I am most excited about these win, win opportunities. It’s about the whole ecosystem of blockchains, and which hopefully being complementary and adding to the whole network effect. And the real competitor being the legacy system. I am excited by the idea that people who want to hold ETH and participate in apps where the gas price is too high but they still want to engage in games – that seems like one of the great reasons. Another thing I am excited about is the possibility of Ethereum solidifying itself outside of this DeFi hub. Write now you have these things like Uniswap and it is all Ethereum centric. The idea that you can trade in NEAR tokens on Ethereum is great and it is one step further towards removing centralized exchanges which in my opinion are one of the best onboarding platforms – but now they are preventing innovation because there is all of this capital locked that is non-programmable, siloed, and custodial. The more we move away from centralized exchanges the better. 

Illia’s Take on This:

This space is about figuring out what works and then everybody adopting it. It naturally is this collaborative competition. As soon as we figure something out, then everybody will have it. You cannot have too much competition without collaboration. I think in general, what we are all working towards is working – We really were excited from the beginning was about making more working stuff for developers to build easier, and getting users to be able to onboard their applications easier to making sure the gas fees and all of these things will be addressed, so I am excited to see how we can learn from each other and get to more working applications and get to more users using this, and to be part of the Ethereum community. I feel like we have been part of the Ethereum community and always were, and now we are trying to innovate a little outside of the mainstream, but making sure that we work with the community together. 

Point 4: NEAR Can Help Bring Back Certain Dapps on ETH That Are Too Expensive Right Now

A lot of people assumed that the NEAR – Ethereum Bridge would largely be to the benefit of NEAR. But what Justin reminded everyone in this session was that there were a number of applications built on ETH that can make a strong comeback through utilizing the NEAR Bridge! 

Justin’s Take:

I want to see the return of these applications that require a low gas – things like Games, CryptoKitties, things like micropayments, even things like ENS – just decentralized domain names. If it costs, 10 – 20 – 30 who knows where gas prices will go to just renew your domain on an annual basis. I am also excited by enlarging the area of innovation. The NEAR team has made quite a few innovations and I think this opportunity is for everyone to learn from each other, and often times this space is very good at copying, so we have seen farming and now everyone is doing farming, etc. I am looking forward to some of these great copyable ideas that the wider space can provide as well. 

Point 5: NEAR is Not Planning on Having More Than 100 Block Producers Anytime Soon, In Order To Keep a High Finality: 

In a discussion on the nature of block validation and finality, both Illia and Justin discuss the spectrum available to different blockchain ecosystems, and the tradeoffs involved therein. Essentially it boils down to this: Fast Finality requires a lower number of block producers, whereas more block producers will increase the amount of time required for finality. NEAR currently can offer 1 second blocks and 2 – 3 second finality. In the long term, there will be many more chunk validators – validating shards – than block producers – validating entire blocks of all chunk headers. 

Illia’s Take:

So with the doomslug, the way it works is there are some kinds of thresholds that allow and right now it is configured for faster finality which means tighter communication, which puts a bound on how many total block producers you can have with that finality. 

So for context the conversation is basically that you can have fast finality, but then you need a low number of block producers, or you can have a lot of block producers, but then the finality will be kind of spanning longer and longer. Right now we have 1 second blocks, roughly, and 2 to 3 second finality right. Which in comparison to the ETH 2 approach you guys have like 12 second slots and 13 minute finality or something like that in the best cases. So that is a spectrum, and finding how to create tiers of security – that is what we did with our shards. There will be a lot more validators on the shards then block production. 

For more information on the structure of the bridge, the importance of security on the blockchain, and the value of Layer 1 Protocols in the development of Crypto check out the Full Transcript of the Session Here!

Why Build On Flux? Developer Incentives and the New Frontier of Open Markets

Flux protocol is a public permissionless development protocol for building the future of open-markets. Created on the distributed infrastructure of the NEAR Ecosystem, Flux offers developers the opportunity to quickly and easily build next-generation open-market solutions in a decentralized, scalable, and secure manner. 

As a public protocol, developers have the opportunity to build solutions on Flux using open-source Software Developer Kits (SDKs), the Flux Open-Source App, Automatic Market Mirrors, as well as the Flux Oracle: In short, all the tools a market creator would need to create an efficient, cheap, and scalable market from any future data source. 

Start Building on Flux, in 3 Lines of Code

The first step in building on Flux, is to download the Flux SDK and import it into your project. The four core features of the Flux SDK, allow prospective developers to create, integrate, and launch new markets in three lines of code: 

Connect with the Flux Oracle: To pull data from existing markets or data repositories. 

Integrate with the Flux Orderbook: To set up a market on Flux Protocol, and for Flux users to interact with. 

Liquidity from Flux Automated Market Maker: To have a foundation for scaling a particular market. 

Easily accessible from any new or existing App: To integrate your market into existing or future applications. 

Create Your Market!

Creating a market on Flux is quick and easy to do, if you already know what kind of an open-market you would like to create. On Flux, three types of markets can be created:

First: Binary Markets – where questions can have a total of two possible outcomes, most often formed in terms of ‘Yes’ or ’No’: Will the Federal Reserve Lower Interest Rates on October 15th? 

Second: Categorical Markets – where questions can have multiple different outcomes specific to a particular question or circumstance: Who will win the Super Bowl in 2021? Team A, Team B, Team C, Team D…. Team N

Third: Scalar Markets – where questions have a total of two possible outcomes, but where value is allocated in proportion to the position taken. Traders have the opportunity to go long or short in a range of values set within clear parameters of  question. 

Why Build On Flux Now? 

Flux revolutionizes open-markets in three primary ways: 

Permission: Any USER and Any DEVELOPER can Participate in ANY Open Market. 

Decentralization: No sole owner of the protocol has the capacity to close or ban an open-market. The design of the protocol is such that markets can operate independently of a central authority. 

Cheap and Scalable: Because Flux is built on NEAR protocol, it is extremely cost-effective and easy to use: Transactions cost less than one cent, with up to 80,000 transactions capable of being processed per second, and resolution times set between 30 minutes and 24 hours depending on the specific market. 

As such, the technical design of Flux Protocol is such that as more projects build on Flux, more users will accrue to the platform. In this manner, Flux will continue to grow over time as its competitive advantages attract increasing numbers of developers, entrepreneurs, and users. 

At its current state of development, Flux protocol presents a rare opportunity for prospective developers: An open frontier of possible markets to create, support and funding from the Flux Team via the Flux Beta Program, and a complete set of tools to start building a specific vertical, market monitor, or user-application. With public interest in open-markets and open-finance on the rise, Flux Protocol offers a unique opportunity for building a decentralized, scalable, and cost-effective future in such markets.