Research Summary
The report discusses the potential of NEAR Protocol, a blockchain project, in the intersection of cryptocurrency and artificial intelligence (AI). It highlights the role of NEAR’s co-founder, Illia Polosukhin, in the project’s development and the company’s future plans, including the establishment of an AI R&D lab.
Key Takeaways
NEAR’s Potential in AI and Blockchain
- NEAR’s AI Ambitions: The report highlights NEAR’s plans to build AI use cases in-house, a departure from other Layer 1 (L1) projects that partner with or fund AI projects. NEAR is actively hiring AI scientists and has announced an AI R&D lab, signaling its intent to position itself as a leading AI chain.
- Illia Polosukhin’s Role: As one of the original people behind Large Language Models and a co-author of a paper about the Transformers model, Illia Polosukhin, NEAR’s co-founder, is seen as a key figure in NEAR’s AI ambitions. His return as CEO in November 2023 marked a turning point for NEAR.
NEAR’s Innovative Technology
- Chain Abstraction and Chain Signatures: NEAR is working on technology that allows ownership of assets and transactions of smart contracts on other chains to be done from NEAR. This could potentially make NEAR’s Chain Abstraction the ultimate interoperability tool, improving Crypto UX.
- Trading of Accounts: NEAR’s account abstraction allows accounts to be turned into NFTs and traded on NEAR. This could create interesting dynamics in terms of on-chain trading and OTC transactions.
NEAR’s Current State and Valuation
- Current State: Despite promising future initiatives, the report notes that NEAR currently has no widely adopted AI use cases. However, daily active users on NEAR continue to make new highs, and on-chain trading volumes have remained consistent over time.
- Valuation: With a $8.3bn market cap and $9bn FDV, NEAR is almost fully circulating (91%) and sits in 13th place in terms of L1s on an FDV basis. The report suggests that NEAR is relatively undervalued, considering its promising story and technology.
Actionable Insights
- Monitor NEAR’s AI Initiatives: Given NEAR’s ambitious plans in the AI space, it would be beneficial to keep a close eye on the development and success of its AI R&D lab and other AI initiatives.
- Assess the Impact of Chain Abstraction: The potential of NEAR’s Chain Abstraction as an interoperability tool could have significant implications for Crypto UX. Understanding its impact could provide insights into future trends in the crypto space.
- Consider NEAR’s Valuation: The report suggests that NEAR is relatively undervalued. It may be worth examining the factors contributing to this valuation and how they might change in the future.
