3 Reasons Why Near Protocol (NEAR) Gained 50% in One Month

Near Protocol’s native token, NEAR, continued its upward trend after rising 2.3% over the last 24 hours to trade at $5.21.

According to data from Cointelegraph Markets Pro and TradingView, NEAR has risen 57% since hitting a low of $3.41 on September 6, reaching an eight-week high of $5.36 on September 24.

Factors contributing to NEAR’s growth include the implementation of blockchain sharding in the Near protocol, an increase in open interest in the futures market, an increase in total value locked (TVL), and a strengthening of the market structure.

Near Protocol implements sharding

Near Protocol, a community-run cloud computing platform focused on interoperability and ultra-fast transaction speeds, has implemented sharding on its network.

According to the project, sharding solves three challenges for blockchain by providing scalability and security without compromising decentralization.

The platform achieved this with the NEAR 2.0 update on August 12, making NEAR the second chain to achieve sharding in production, following Elrond (EGLD).

By implementing sharding, Near Protocol is positioned for steady, long-term growth as demand for decentralized applications (DApps) grows.

Compared to Ethereum, the NEAR protocol offers faster and more scalable options with lower transaction fees, and sharding plays a key role in this efficiency.

NEAR’s pricing performance also stems from a recent partnership between Nvidia and Alibaba Cloud aimed at improving China’s autonomous driving industry.

AI-themed crypto tokens, including NEAR, have been reacting positively to major announcements from Nvidia, and this time around was no exception.

Another catalyst for AI-related tokens came from Democratic presidential candidate Kamala Harris’s suggestion that she would create an “opportunity economy” for AI and digital assets in the U.S. This is the first time Harris has publicly shared her stance on the cryptocurrency industry.

On-chain data supports NEAR’s price surge.

Increased network activity and network growth have preceded NEAR’s price performance over the past month. This is a result of increased activity driven by increased project adoption of the NEAR protocol, which saw the number of daily transactions on the platform increase by 42% between August 25 and September 24, according to data from NearBlocks.io. Likewise, the number of new addresses increased by 30.8% during the same period, demonstrating growing adoption.

The increase in network activity has led to increased network and user engagement, which has led to an increase in the platform’s total value locked (TVL). According to data from DefiLlama, Near Protocol’s TVL has increased by 34% from $183.7 million on September 7 to $246.5 million on September 24.

meIncreasing TVL indicates increased activity and interest within the Near Protocol ecosystem. This means more users are depositing or leveraging their assets within NEAR-based protocols.

Additionally, according to derivatives data tracking site Coinglass, NEAR’s OI increased from $114.9 million on September 7 to $279.2 million on September 24, the highest level since June 7. This increase indicates that new or additional funds are flowing into the market and that new buying is occurring.

relevant: The hack of OpenAI’s press accounts was the fifth security breach in 20 months.

NEAR’s strengthened market structure suggests further upside potential.

The NEAR rally saw it break above the downtrend line on September 23. It also closed above all major moving averages, including the 50-day exponential moving average (EMA) at $4.40, the 100-day EMA at $4.75, and the 200-day EMA at $4.87, which have been barriers since mid-June.

A Relative Strength Index value of 70 suggests that buyers are dominating the NEAR market.

The bulls will now focus on pushing the price up to $6, and possibly the 19th high of $6.45.

Conversely, a daily candlestick close below the 50-day EMA of $4.40 would invalidate the bullish theory by creating a lower low on the daily chart. The bears could then push NEAR down another 32% to retest the September 6 low of $3.50.

This article does not contain any investment advice or recommendations. All investment and trading moves involve risk, and readers should conduct their own research when making decisions.