NEAR Protocol’s Impressive Growth: Key Highlights

NEAR Protocol has experienced a remarkable 50% price increase within a month, driven by a rise in user participation, enhanced total value locked (TVL), and a vital network update. This surge has attracted considerable attention to the blockchain, positioning it among the top tokens in the market.

The NEAR token, native to the NEAR Protocol, has continued its upward trend with a recent 2.3% gain, now trading at $5.21. As per Cointelegraph Markets Pro and TradingView data, NEAR has rebounded from a low of $3.41 on September 6, achieving a significant 57% rise to reach an eight-week peak of $5.36 by September 24.

Key Drivers Behind NEAR’s Recent Performance

Here are three significant factors that have propelled NEAR’s recent success:

1. Implementation of Sharding

The NEAR Protocol has effectively deployed sharding, a major upgrade that enhances its interoperability and transaction speed. This technology divides the blockchain into smaller segments, or “shards,” enabling the network to process multiple transactions concurrently.

This achievement came with the NEAR 2.0 update on August 12, making it the second blockchain to apply sharding in a live environment, following Elrond (EGLD). By addressing the blockchain trilemma—achieving scalability, security, and decentralization—sharding positions NEAR for sustained growth, particularly with the increasing demand for decentralized applications (DApps).

NEAR’s sharding method provides a faster and more scalable option compared to Ethereum, with reduced transaction fees, which is essential as decentralized finance (DeFi) and other blockchain services continue to grow.

2. Rise in Network Usage and TVL

Recent data illustrates a significant rise in user engagement and adoption within NEAR Protocol. Reports from NearBlocks.io indicate that from August 25 to September 24, daily transactions surged by 42%, and the creation of new addresses rose by 30.8%. This jump in activity has directly influenced NEAR’s price increase.

Additionally, the total value locked (TVL) in NEAR protocols has substantially grown. Data from DefiLlama reveals NEAR’s TVL escalated by 34%, going from $183.7 million on September 7 to $246.5 million on September 24. An increasing TVL reflects a stronger confidence in the platform’s DeFi offerings.

3. Growing Interest in NEAR Futures

NEAR’s price uptrend corresponds with a surge in open interest (OI) in futures markets. Coinglass data shows the OI for NEAR rose dramatically from $114.9 million on September 7 to $279.2 million on September 24, marking the highest level since early June. This growth in OI suggests a robust inflow of capital and a bullish sentiment among traders regarding NEAR’s future.

Moreover, NEAR has benefited from wider market trends, including heightened interest in AI technologies. The recent collaboration between Nvidia and Alibaba Cloud, aimed at enhancing autonomous driving tech in China, had a positive impact on NEAR. AI-themed cryptocurrencies usually respond favorably to such developments, and endorsements, like U.S. Democratic candidate Kamala Harris discussing AI and digital assets, further elevate market sentiment towards projects like NEAR.

Technical Analysis: Robust Market Dynamics

Technically, NEAR is showing strong market vigor. The token broke through a descending trendline on September 23 and has remained above crucial moving averages, including the 50-day EMA ($4.40), 100-day EMA ($4.75), and 200-day EMA ($4.87). These previously resistant levels are now supporting potential further gains.

Now, NEAR’s relative strength index (RSI) is at 70, indicating that buyers are dominating the market, likely pushing NEAR’s price toward the next target of $6.45.

Nevertheless, if the price dips below the 50-day EMA at $4.40, it might indicate a shift toward a bearish trend, possibly leading to a decrease of 32% to revisit the low of $3.50 from September 6.

In conclusion, NEAR Protocol’s 50% monthly price increase is attributed to its successful sharding implementation, increased network activity and TVL, and rising interest in NEAR futures. Bolstered by a solid technical outlook, NEAR appears well-equipped for future growth, marking it as a significant blockchain to keep an eye on in the forthcoming months.