What Is NEAR Token: TPS, Sharding & Comparison

Contents

• What Is NEAR Protocol?
• Who Founded NEAR Protocol?
• How Does NEAR Protocol Work?
• NEAR Protocol TPS: How Fast Is NEAR?
• What Is the NEAR Token?
• What Is Nightshade Sharding? How NEAR Achieves Scalability
• What Can You Build on NEAR Protocol?
• What Makes NEAR Protocol Different?
• Frequently Asked Questions About NEAR Protocol
• NEAR Protocol TPS: Key Takeaways

What Is NEAR Protocol?

NEAR Protocol is a proof-of-stake, sharded Layer 1 blockchain (a base-layer network where transactions are directly recorded and validated) designed to support fast, low-cost smart contracts and decentralised applications, with a theoretical maximum throughput of up to 100,000 transactions per second enabled by its Nightshade sharding technology. The network's native asset, the NEAR token, powers transaction fees, staking, and governance across the ecosystem.

NEAR Protocol's practical purpose is to give developers a high-performance foundation for building decentralised applications (DApps). That includes decentralised finance (DeFi) protocols, NFT platforms, blockchain games, and payment applications. Smart contracts on NEAR compile to WebAssembly (WASM), with Rust and JavaScript as the primary supported languages. Aurora, NEAR's EVM-compatible execution layer, allows Solidity developers to deploy Ethereum contracts on NEAR infrastructure without rewriting code.

The design context matters here. Blockchain engineers often describe a tradeoff called the blockchain trilemma: a network can optimise for two of three properties simultaneously (decentralisation, security, and scalability) but achieving all three at once is architecturally difficult. Ethereum prioritised decentralisation and security, which left scalability constrained, producing the slow throughput and high gas fees that many users have experienced firsthand. NEAR Protocol was built from the ground up to address that tradeoff through Nightshade sharding, which processes transactions across parallel partitions rather than sequentially, aiming to raise the scalability ceiling without abandoning security or decentralisation. NEAR does not claim to have resolved the trilemma definitively. It represents a design approach to minimising the tradeoff.

Who Founded NEAR Protocol?

NEAR Protocol was founded in 2018 by Illia Polosukhin and Alexander Skidanov, with the mainnet launching in October 2020.

Illia Polosukhin brings an unusual credential to blockchain. He is a co-author of the landmark 2017 research paper "Attention Is All You Need" (Vaswani et al., Google Brain), which introduced the Transformer architecture that now underpins GPT, BERT, and most modern large language models. That paper is among the most cited in the history of machine learning. Polosukhin's AI research background gives NEAR Protocol a technical credibility that few blockchain projects can match at the founder level.

Alexander Skidanov's background sits on the infrastructure side. He previously worked as an engineer at Google and at MemSQL, a high-performance distributed database company. Distributed database engineering is where sharding originated as a design pattern, and Skidanov's direct experience with horizontal data partitioning at scale informed NEAR's sharded architecture. This connection between database engineering and blockchain scalability is rarely noted in coverage of NEAR, but it explains why the sharding design reflects deep practical experience.

The NEAR Foundation, a Swiss non-profit organisation, stewards the NEAR Protocol ecosystem through developer grants, ecosystem partnerships, and governance participation. The Foundation does not operate or control the NEAR Protocol network. That responsibility rests with the decentralised validator set and token holders.

How Does NEAR Protocol Work?

NEAR Protocol processes transactions through a two-layer system: a Thresholded Proof of Stake consensus mechanism that selects validators based on their staked NEAR tokens and randomly reshuffles them across shards each epoch, and Nightshade sharding that divides the network into parallel processing lanes so multiple transaction streams advance simultaneously.

Think of a single-lane road: cars pass one at a time, and any bottleneck stops everything behind it. Nightshade sharding adds parallel lanes so many cars travel at once, each independently reaching its destination. More precisely, NEAR splits its blockchain state across multiple shards, each processing its own transaction stream and producing a "chunk" of the overall block. All chunks are assembled into one unified block, giving the network a single coherent ledger despite the parallel processing.

NEAR's consensus mechanism is called Thresholded Proof of Stake (TPoS), which differs from standard delegated proof of stake used by some other chains. Under TPoS, validators are selected based on the amount of NEAR tokens they have staked. Approximately 100 active validators participate in block production at any given time (NEAR documentation). These validators are randomly reshuffled across shards roughly every 12 hours (each epoch). This reshuffling prevents any coordinated group from dominating a single shard, maintaining security without requiring every validator to process every transaction on the network. The efficiency of this selection mechanism contributes directly to NEAR's low block time of approximately one second.

NEAR Protocol operates across 100-plus active validators distributed globally. The NEAR Foundation does not control the network. Like all proof-of-stake systems, staking concentration among large token holders is an ongoing area of community discussion.

A full transaction flow looks like this: a user submits a transaction, which is routed to the relevant shard. Chunk producers assigned to that shard process the transaction and produce a chunk. The chunk is included in the next block, and finality is reached in approximately two seconds. Finality is the point at which a transaction is irreversibly confirmed and cannot be reversed. That figure becomes important context for the TPS comparison in the next section.

NEAR Protocol TPS: How Fast Is NEAR?

NEAR Protocol can process up to 100,000 transactions per second (TPS) at theoretical maximum capacity, enabled by its Nightshade sharding technology. Real-world throughput under normal network conditions is lower, dependent on active shard count and average transaction load. Transaction finality on NEAR takes approximately 2 seconds, placing it among the fastest Layer 1 blockchains available. (Sources: NEAR documentation, 2025; Chainspect.)

Theoretical Maximum vs. Real-World TPS: What the Numbers Actually Mean

The 100,000 TPS figure is a theoretical maximum. It assumes full utilisation of all available shards under optimal network conditions, which is a benchmark scenario rather than observed daily throughput.

Real-world TPS reflects the actual transaction volumes the network processes under normal load, with partial shard utilisation and average user activity. The gap between theoretical and real-world figures exists because not all shards operate at full capacity simultaneously, and transaction demand fluctuates. Current real-world NEAR TPS falls in the range of approximately 800 to 1,200 TPS under typical network conditions (2025; verify current data at Chainspect or NEAR Explorer, as these figures shift with network load).

The theoretical ceiling is not a fixed number. Each active shard contributes approximately 10,000 TPS to NEAR's total theoretical capacity. As NEAR activates additional shards through its phased Nightshade roadmap, that ceiling grows.

Layer 1 Blockchain TPS Comparison (2025)

Sources: NEAR documentation (2025), Chainspect, official chain documentation. *Solana's stated TPS includes validator votes and internal protocol messages. User-facing transaction TPS is lower than headline figures suggest. All figures are approximate and subject to network conditions.

NEAR Protocol vs. Ethereum, Solana, and Avalanche: Performance Breakdown

NEAR vs. Ethereum: The TPS gap between NEAR and Ethereum's base layer is substantial. NEAR's theoretical maximum sits around 100,000 TPS; Ethereum's mainnet handles approximately 15 to 30 TPS under normal conditions, rising toward 100 TPS under optimistic post-Merge estimates. The fee differential matters equally for everyday users: NEAR transactions cost approximately $0.001 under a deterministic fee schedule, compared to Ethereum's auction-based gas model that has ranged from under a dollar to over $50 during periods of network congestion. NEAR's approximately two-second finality also contrasts with Ethereum's finality under Casper FFG, which takes roughly 12 to 15 minutes. Ethereum's genuine strength is its substantially larger DeFi total value locked and broader developer ecosystem, and that advantage is worth stating plainly.

NEAR vs. Solana: A useful starting point for the Solana comparison is measurement methodology. Solana counts validator votes and internal protocol messages alongside user transactions, which inflates its raw TPS count relative to user-facing activity. At real-world load, Solana sustains roughly 2,000 to 3,000 user-facing transactions per second, while NEAR's theoretical ceiling of approximately 100,000 TPS exceeds Solana's theoretical maximum of approximately 65,000 TPS. Both networks sit among the fastest Layer 1 blockchains available, and neither should be declared definitively "faster" without specifying measurement context. They reach their performance through different mechanisms: NEAR uses Nightshade sharding across a single coherent chain, while Solana uses Proof of History combined with Tower BFT. NEAR also uses human-readable account names (such as alice.near) rather than hexadecimal address formats, which reduces onboarding friction for non-technical users.

NEAR vs. Avalanche: Avalanche takes a fundamentally different architectural approach to throughput. Rather than native single-chain sharding, Avalanche uses a multi-chain subnet model with separate C-Chain, X-Chain, and P-Chain instances plus custom subnets, reaching approximately 4,500 TPS through this parallelisation. NEAR's Nightshade sharding operates as one coherent chain that scales horizontally by adding shards. The two architectures achieve parallel processing through distinct philosophies, with differing implications for developer experience. Other interoperability-focused platforms such as Cosmos (which uses the Inter-Blockchain Communication protocol across sovereign chains) and Polkadot (which uses specialised parachain shards) take yet further distinct approaches to the same scaling challenge.

What Is the NEAR Token?

The NEAR token is the native cryptocurrency of the NEAR Protocol network, serving four core functions that connect TPS performance to practical user economics.

What Is the NEAR Token Used For?

1. Gas fees: NEAR tokens pay for transaction costs on the network, approximately $0.001 per transaction as of 2025 (Source: NEAR documentation). High throughput combined with low fees means real usage at scale remains affordable. The full benefit of 100,000 TPS is only practical if transactions are cheap enough to send in volume.
2. Staking: Validators and delegators stake NEAR to participate in consensus and earn staking rewards. Staking concentration among validators also determines selection under TPoS, making staking central to network security.
3. Storage staking: Accounts on NEAR pay for on-chain data storage by locking NEAR tokens, a model called storage staking. This design keeps the network state manageable as transaction volumes grow.
4. Governance: Token holders can participate in protocol governance decisions, giving the community a formal voice in protocol changes.

High transaction volume drives demand for NEAR as gas, which connects network performance directly to token utility.

NEAR Tokenomics and Staking Rewards

NEAR Protocol launched with approximately 1 billion NEAR tokens at genesis. The supply is not fixed: the protocol issues new NEAR tokens as validator rewards, creating an inflationary issuance mechanism that compensates block producers. Seventy percent of transaction fees are burned as a deflationary offset, and the remaining 30% go to the smart contract developer who received the transaction. Current circulating supply differs from the genesis figure; for live data, refer to NEAR on CoinGecko.

Staking yields for validators and delegators are approximately 8 to 10% APY, though this figure fluctuates with network conditions and total staked supply. Verify the current rate at NEAR Explorer before making any decisions based on it. Token holders can delegate to validators without running a node themselves and earn a share of validator rewards after commission. Staking rewards are approximate and variable. This section does not constitute financial advice.

For a step-by-step walkthrough of staking NEAR tokens, see a dedicated NEAR Protocol staking guide for full instructions on delegation and validator selection.

What Is Nightshade Sharding? How NEAR Achieves Scalability

Nightshade is NEAR Protocol's proprietary sharding system that divides the blockchain's transaction processing across multiple parallel shards, with each shard producing a "chunk" of the overall block simultaneously, enabling the network to scale its TPS capacity by adding more shards.

How Nightshade Sharding Works

Blockchain sharding splits a network's state and transaction processing across parallel partitions. Each partition, called a shard, is handled by a subset of validators and processes its own independent transaction stream, so instead of one queue processed sequentially, multiple queues advance in parallel. The highway analogy from the previous section captures this: rather than one lane of traffic, NEAR runs multiple lanes simultaneously. Nightshade is the specific mechanism NEAR uses to implement this idea, and it differs from generic sharding in several important ways.

In NEAR's Nightshade implementation, each shard produces a "chunk," which is a fragment of the full block containing only that shard's transactions. Chunk producers are validators assigned specifically to one shard; they process only their shard's activity rather than the entire network state. All chunks from all active shards are then assembled into a single unified block, so from the perspective of users and applications, NEAR remains one coherent blockchain. Validators are randomly reshuffled across shards each epoch (approximately every 12 hours), preventing any coordinated group from accumulating disproportionate influence over a single shard. Security is maintained without requiring every validator to process every transaction.

Each active shard adds approximately 10,000 TPS to NEAR's theoretical capacity. With current shard counts, the theoretical ceiling reaches approximately 100,000 TPS, and as additional shards activate through the phased rollout, that number rises. For developers familiar with database design: blockchain sharding borrows the horizontal partitioning concept from distributed databases, but the trustless consensus requirements make the blockchain implementation architecturally more demanding.

For the full technical specification, see the NEAR Nightshade whitepaper.

The Nightshade Roadmap: NEAR's Scaling Phases

NEAR's sharding rollout proceeds through four phases. The TPS ceiling at each stage reflects the shard count and validator architecture active at that point. Verify the current status of in-progress phases from the NEAR engineering blog before publication, as development is ongoing as of 2025.

The significance of this roadmap is that NEAR's maximum TPS is not a static ceiling. Each phase completion expands theoretical capacity. An article that cites only "100,000 TPS" without this context presents a snapshot; the roadmap shows a trajectory.

What Can You Build on NEAR Protocol?

NEAR Protocol's combination of high throughput, approximately two-second finality, and sub-cent transaction fees makes it technically competitive for four categories of decentralised application.

NEAR Protocol Use Cases: DeFi, NFTs, Gaming, and Payments

1. DeFi (Decentralised Finance): Fast settlement is the core requirement for efficient automated market makers, lending protocols, and yield aggregators. DeFi applications execute frequent, small-value transactions, and NEAR's low fees and high throughput make those transaction economics viable at scale.
2. NFT platforms: Large-scale NFT mints and active secondary markets generate burst transaction demand. Lower-throughput networks respond to this demand with fee spikes and congestion; NEAR's capacity absorbs it without disrupting the user experience.
3. Blockchain gaming: Real-time in-game economies need near-zero fees for microtransactions and fast confirmation so actions feel immediate. Sub-second block times and approximately $0.001 fees make NEAR technically suited for this category.
4. Payments and micropayments: Two-second finality means a payment recipient can treat a confirmed transaction as permanent within two seconds of submission. Combined with predictable low fees, this makes NEAR a candidate for real-world payment flows where confirmation speed and cost predictability are requirements rather than optional features.

Building on NEAR Protocol: Languages, Tooling, and Aurora

NEAR Protocol supports Rust as the primary smart contract language, compiled to WebAssembly (WASM). JavaScript is also supported via the NEAR SDK for JS, compiled to the same WASM runtime. This dual-language approach differentiates NEAR from Ethereum's Solidity-centric environment and lowers the barrier for web developers already familiar with JavaScript.

For Ethereum developers, Aurora, NEAR's EVM-compatible execution layer, removes migration friction. Aurora is an Ethereum Virtual Machine implementation built on NEAR Protocol infrastructure, allowing existing Solidity smart contracts to deploy on NEAR without code modification. Aurora inherits NEAR's low fees and high throughput while maintaining full compatibility with Ethereum tooling: MetaMask, Hardhat, Truffle, and standard Solidity development workflows all function as expected. Aurora uses ETH as its gas token rather than NEAR, which further reduces friction for teams migrating from Ethereum. Aurora is operated by Aurora Labs, a separate company from the NEAR Foundation, though it runs on NEAR Protocol infrastructure. One technical distinction: Aurora is processed as a single shard within NEAR, meaning its throughput does not scale with additional Nightshade shards the way native NEAR transactions do.

Rainbow Bridge is a permissionless, trustless cross-chain bridge that enables asset transfers between NEAR Protocol and Ethereum without a centralised intermediary. It uses light client proofs for security, which distinguishes it from custodial bridge designs that rely on trusted third parties.

NEAR Foundation's 2024/2025 strategic narrative centres on "Chain Abstraction," which is the vision that users should not need to know which blockchain an application runs on, with NEAR infrastructure managing cross-chain complexity in the background. This positions NEAR beyond fast-blockchain framing toward a broader infrastructure role. Chain Abstraction is a strategic direction currently being developed rather than a fully implemented technical feature.

For full developer documentation, SDK guides, and API references, see the NEAR Protocol documentation.

What Makes NEAR Protocol Different?

Six characteristics distinguish NEAR Protocol from other Layer 1 blockchains in its performance class.

1. Nightshade sharding: A live, phased sharding architecture with a theoretical TPS ceiling that grows as additional shards activate through the roadmap. No other top-ranking Layer 1 has the same native single-chain sharding design at this stage of deployment.
2. Human-readable account names: NEAR accounts use names like alice.near rather than hexadecimal addresses. This UX difference lowers onboarding friction for non-technical users and applications.
3. Aurora EVM compatibility: Ethereum developers can deploy existing Solidity contracts on NEAR infrastructure via Aurora without rewriting code, reducing the cost of evaluating NEAR as an alternative or complement to Ethereum.
4. Founder AI research pedigree: Illia Polosukhin co-authored the Transformer architecture paper that underpins GPT, BERT, and modern large language models. Few blockchain founders hold research credentials of this calibre in adjacent technical fields.
5. Low and predictable gas fees: Approximately $0.001 per transaction under a deterministic fee schedule rather than an auction model. Predictable fees matter for application developers building user experiences where transaction costs must be calculable in advance.
6. Chain Abstraction vision: NEAR Foundation's 2024/2025 strategic direction frames NEAR as infrastructure that abstracts blockchain complexity for end users, positioning the project beyond the category of "fast Layer 1" toward a multi-chain infrastructure role.

Frequently Asked Questions About NEAR Protocol

What is NEAR Protocol and how does it work?

NEAR Protocol is a proof-of-stake, sharded Layer 1 blockchain that processes transactions in parallel across multiple shards via its Nightshade sharding mechanism. Validators are selected through Thresholded Proof of Stake, randomly reshuffled across shards each epoch, and produce chunks that assemble into a unified block. Transaction finality takes approximately two seconds. The network supports smart contracts in Rust and JavaScript, and Aurora provides EVM compatibility for Solidity developers.

How many transactions per second can NEAR Protocol handle?

NEAR Protocol can process up to 100,000 transactions per second (TPS) at theoretical maximum capacity, assuming full utilisation of all active shards (Source: NEAR documentation, 2025). Real-world TPS under normal network load is lower, approximately 800 to 1,200 TPS under typical conditions. Verify current figures at Chainspect. The theoretical ceiling grows as NEAR activates additional shards through its phased Nightshade roadmap.

Is NEAR Protocol faster than Solana?

NEAR Protocol's theoretical maximum TPS (approximately 100,000) exceeds Solana's theoretical maximum (approximately 65,000 TPS). Real-world comparisons depend on network conditions and measurement methodology: Solana's headline TPS figures include validator votes and internal protocol messages, inflating the count relative to user-facing transactions. Both networks rank among the fastest Layer 1 blockchains available, and neither can be declared definitively faster without specifying the measurement context.

What makes NEAR Protocol unique?

Six characteristics distinguish NEAR: Nightshade sharding (a live, phased native sharding architecture), human-readable account names like alice.near, Aurora EVM compatibility allowing Solidity contracts to run on NEAR without modification, founder AI research credentials (Illia Polosukhin co-authored the 2017 Transformer architecture paper), low and predictable gas fees of approximately $0.001 under a deterministic fee model, and NEAR Foundation's Chain Abstraction strategic vision for multi-chain infrastructure.

What is Nightshade sharding?

Nightshade is NEAR Protocol's proprietary sharding system that divides the blockchain's transaction processing across multiple parallel shards, with each shard producing a chunk of the overall block simultaneously. Validators called chunk producers handle individual shards and are randomly reshuffled each epoch to maintain security. Each additional shard adds approximately 10,000 TPS to theoretical capacity. The full technical specification is in the NEAR Nightshade whitepaper.

Who created NEAR Protocol?

NEAR Protocol was founded in 2018 by Illia Polosukhin and Alexander Skidanov, with mainnet launching in 2020. Polosukhin co-authored "Attention Is All You Need" (2017), the paper introducing the Transformer architecture underlying GPT, BERT, and modern large language models. Skidanov previously worked at Google and MemSQL, a distributed database company, bringing direct experience with horizontal data partitioning, which is the same design principle behind blockchain sharding.

What is the NEAR token used for?

The NEAR token serves four functions on the network: paying gas fees (approximately $0.001 per transaction), staking for validator selection and consensus participation, storage staking to cover on-chain data storage costs, and governance voting on protocol decisions. High transaction volume on the network drives demand for NEAR as gas, connecting throughput performance to token utility directly.

Is NEAR Protocol decentralised?

Yes. NEAR Protocol operates across 100-plus active validators distributed globally. The NEAR Foundation is a Swiss non-profit that supports ecosystem development through grants and governance participation but does not operate or control the network. Validator reshuffling each epoch prevents concentrated control of individual shards. As with all proof-of-stake systems, staking concentration among large holders is an area the community continues to monitor.

What is Aurora on NEAR Protocol?

Aurora is an EVM-compatible execution layer built on NEAR Protocol that allows Ethereum Solidity smart contracts to deploy on NEAR infrastructure using standard Ethereum tooling, including MetaMask, Hardhat, Truffle, and the full Solidity development workflow. Aurora uses ETH as its gas token rather than NEAR, reducing migration friction. It is operated by Aurora Labs, a separate company, but runs on NEAR Protocol's infrastructure. Aurora processes transactions as a single shard, so its throughput does not scale with additional Nightshade shards the way native NEAR transactions do.

How do NEAR Protocol gas fees compare to Ethereum?

NEAR transactions cost approximately $0.001 under a deterministic fee schedule where fees are predictable in advance. Ethereum uses an auction-based gas model where fees vary with network congestion; historical Ethereum gas fees have ranged from under $0.50 to over $50 per transaction during peak periods. NEAR's fees are orders of magnitude lower for typical transactions, and the deterministic pricing model benefits application developers who need to calculate user-facing costs in advance.

What is NEAR Protocol's finality time?

NEAR Protocol achieves transaction finality in approximately two seconds (Source: NEAR documentation). Finality is the point at which a transaction is irreversibly confirmed and cannot be reversed. This compares to Ethereum's finality of approximately 12 to 15 minutes under Casper FFG. The two-second finality makes NEAR suited for real-time applications such as payments, gaming, and trading, where users need prompt certainty that a transaction has settled permanently.

Is NEAR Protocol a good investment?

Whether NEAR Protocol is a good investment depends on individual risk tolerance and investment goals. NEAR is a technically competitive Layer 1 blockchain with active development, a growing developer ecosystem, and a founder team with demonstrable technical credentials, which are factors that investors often evaluate when assessing blockchain projects. This article does not constitute financial advice. Consult a qualified financial advisor before making any investment decisions.

What is the NEAR Foundation?

The NEAR Foundation is a Swiss non-profit organisation that supports NEAR Protocol ecosystem development through developer grants, ecosystem partnerships, and governance participation. It does not operate or control the NEAR Protocol network, which is maintained by a decentralised set of validators and governed by token holders.

Where can I find current NEAR Protocol market data?

For current NEAR Protocol market cap, price, and circulating supply data, refer to NEAR on CoinGecko. Static price figures are not included in this article because they become outdated rapidly and market conditions change continuously.

NEAR Protocol TPS: Key Takeaways

NEAR Protocol sits among the fastest Layer 1 blockchains available, with a theoretical maximum of approximately 100,000 transactions per second, approximately two-second finality, and sub-cent transaction costs made possible by its phased Nightshade sharding architecture.

Four figures to carry forward:

• Theoretical max TPS: approximately 100,000, growing as Nightshade phases complete and shard count scales
• Transaction finality: approximately 2 seconds
• Average gas fee: approximately $0.001 under a deterministic fee model
• Founders: Illia Polosukhin (Transformer architecture co-author) and Alexander Skidanov (formerly Google and MemSQL)

For deeper exploration, these primary sources are the right next steps:

NEAR Protocol documentation covers developer guides, SDK references, and API documentation for builders evaluating NEAR as a deployment target.

NEAR Nightshade whitepaper contains the full technical specification of the sharding design for readers who want the architectural detail behind the TPS figures.

For live market data including circulating supply and price information, NEAR on CoinGecko provides continuously updated figures.