NEAR Performance During the Recent Volatility

Introduction

What is NEAR Protocol?

Near Protocol is a decentralized application (DApp) platform that focuses on usability among developers and users. As a competitor of Ethereum, NearProtocol is also smart-contract capable and a proof-of-stake (PoS) blockchain.

NEAR operates in a similar manner to other centralized data storage systems like Amazon Web Services (AWS) that serve as the base layer on which applications are built. But rather than being run by a single entity, NEAR is operated and maintained by a distributed network of computers.

Just as AWS allows developers to deploy code in the cloud without needing to create their own infrastructure, NEAR facilitates a similar architecture built around a network of computers and its native cryptocurrency, the NEAR token. (Source 1,2)

Questions

Choose and define at least 2 measures of ecosystem health, and assess how NEAR is performing on those metrics between the week of 11/7 and 11/14.

The goal is to gain a better understanding of how both NEAR and other ecosystems respond to market conditions that heavily affect one of their peers (in this case, Solana).

Some examples of health metrics:

Unstaking - how many people are pulling up stake
NFT sales vs. buys and if it’s materially changed (are people dumping their NFTs for capital)
Stable % of trade activity — are users fleeing or buying the dip?

Methodology

In this dashboard, the NEAR performance during the recent volatility has been analyzed in 4 Sections:

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- General overview of some vital metrics in the NEAR network
- NEAR Protocol performance compared to Solana blockchain: Price and transactions
- NEAR Protocol performance compared to Solana blockchain: NFTs
- NEAR Protocol performance compared to Solana blockchain: Staking
  
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This dashboard uses the NEAR and Solana databases and the following tables to extract information:
- near.core.ez_dex_swaps
- near.core.ez_nft_mints
- near.core.dim_staking_actions
- near.core.fact_transactions
- near.core.fact_prices
- near.core.fact_receipts
- solana.fact_swaps
- solana.core.fact_nft_sales
- solana.core.fact_stake_pool_actions
- flipside_prod_db.solana.fact_transactions
The Max time frame provided in this dashboard:
- From October 25,2022, until today

How did the NEAR Protocol perform between the weeks of November 7 and November 14?

Insights:

Between the week of 11/7 and 11/14, we can see a huge impulse in the number of swaps in the NEAR network. The number of swaps has increased from 4985 to above 27000 swaps on Nov 9 as a result of the volatility in the crypto space. Since Nove 10 until today the number of swaps still remains high compared to the period before this week
In this particular week, the number of traders has been increasing too. From Nov 7 until Nov 9, each day we witnessed a higher number of swappers in the network. The number of swappers reached 879 unique swappers on Nov 9, the highest record in recent weeks as the result of this recent crash of crypto. After Nov 9 the number of swappers came down and stays at the same level it was before this week
While we had a huge increase in the number of NFT sellers on Nov 7, the number of sellers starts to decrease since then. On the other side the number of NFT sales has been increasing from Nov 7 until Nov 9 but on the day after, On Nov 10 we have seen 6x increase in the number of NFT sales. More than 48000 NFTs have been sold on Nov 10. looks like users had a panic moment and were dumping their NFTs to get cash back. Since Nov 11 the number of NFT sales has declined and backed to the normal range as it was before the volatility
The overall number of daily transactions in the NEAR network has seen an increase in this period too. From Nov 7 until Nov 9 the number of transactions increased and reached to + 851k level on Nov 9. The number of transactions remains high on the day after (Nov 10) but after that transactions quantity has backed to the normal range of daily transactions to around 500-600k
As a result of volatility panic sell increase. This can be seen in the staking side of the network. On Nov 9 the number of Unstakers increased by 120% compared to the day before it. The next day we have seen a decline in the number of Unstakers but still higher compared to the week before this period. This trend continues and until Nov 14, the number of Unstakers remains in the uptrend
On the swap side, we can see volume has increased on both sides of the $NEAR pairs. From $NEAR to other tokens and From other tokens to $NEAR. This means some participants are buying tokens as a buying the deep opportunity and some are swapping back to NEAR as the stronger asset during this crash. both sides have seen an increase in volume From Nov 7 until Nov 9 when we reached the highest volume in recent weeks on Nov 9. Since Nov 9 the volume have been dropped for both directions but still remains higher compared to before Nov 7 period

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NEAR Protocol performance compared to SOLANA blockchain during this week

Insights:

In terms of token price movement, we can see $NEAR has dropped from 3.33 down to 1.92 which is a 43% drop and $SOL has dropped from 35.35 to around 13.81 which is a 61% drop. So NEAR has a better hold value position compared to Solana
In terms of transactions, we can see both NEAR and Solana have shown an increase in transaction traffic since Nov 7. For NEAR this increment reached 851k daily transactions on Nov 9 which is a 72% increase in the number of transactions compared to Nov 6 and Solana reached 40.41 million transactions on Nov 11 which is a 31% increase in the transactions compared to Nov 6. So NEAR has seen more % increase in the number of transactions in its network compared to the period before the volatility
We can see an increase in the transaction Fee on both networks as the traffic in the networks increased Since Nov 7. According to the Fee chart, we can see a 57% increase in the cost of a transaction on the NEAR network and we can see a 463% increase in the Solana transaction fee. So in terms of network capacity, we can see NEAR has done a better job to keep Fees low in the volatility time.
With the increase in the number of transactions, the network needs to handle more transactions at the same time. While the network might have limits to processing transactions this can lead to an increase in failed transactions. The success rate of transactions has declined for both NEAR and SOLANA in the recent week as the volatility and traffic increased. Since Nov 6 the success rate has dropped 31% for the NEAR network and has dropped 46% for Solana. This can show the NEAR protocol strength again. Much better performance to handle transactions in the difficult times compared to Solana.

Insights:

From Nov 7 until Nov 14 we can see a downtrend in the number of NFT buyers for Solana NFTs. The lowest number of buyers appeared on Nov 11 with only 6185 buyers in the network (more than a 40% decline). NEAR NFTs buyers are in a downtrend since October and in the recent week the same downtrend has continued but on Nov 12 we have seen a bump in the NFT buyers in the NEAR NFT space, perhaps some buyers saw the situation as a buy-the-dip opportunity
Interestingly on the seller side of NFTs, we can see a downtrend too on both networks. No sharp increase happened in the number of Sellers in both chains. But we can see a small increase in the number of sellers on Nov 13 and Nov 14 on Solana but nothing serious because we have seen a bigger number of sellers way before this volatile week
This can be seen on the NFT sales chart too. No sharp increase in the number of NFT sales for both chains. We can see a small uptrend in the NEAR NFT sales from Nov 8 til Nov 12 but nothing considerable compared to the weeks before this volatility. On Solana, the number of NFT sales has been declining during this week except for Nov 14 when a big number of Sales appeared in the network
NFT's sale volume shows a similar pattern. No solid increase in the sales volume can be seen during this week. Both NEAR and Solana NFT sales volume are in a general downtrend since before the volatility and no substantial Sales volume appeared in this week.

Insights:

During volatility, Stakers might start to unstaking to sell or be ready to sell by not being locked in the staking contract. This can be seen on Both NEAR and Solana. Since Nov 7 as the volatility appeared both Network stakers starts to unstake. The number of unstake transactions shows a 2100% increase in the Solana unstake transactions and a 156% increase in the NEAR unstake transaction as the volatility rises. This can conclude that NEAR stakers had more confidence to not unstake and hold their staking compared to Solana stakers
The number of unstakers has seen increases as well. 120% increase in the number of unstakers in the NEAR network and a 1623% increase in the number of unstakers in the Solana network. Again we can see that NEAR stakers are more willing to stay in the staking positions compared to Solana stakers
More than 106x increase in the Unstake volume can be seen from Nov 7 til Nov 10 on Solana! The unstake volume for NEAR has been high too. Unstake volume has been increased from 94k $NEAR up to 16.95 million $NEAR on Nov 14, more 180x increase!
NEAR network has seen a bigger unstake volume but far lower unstakers and Unstake transactions compared to Solana. This can be concluded that a small number of users with a big amount of $NEAR staking tokens have unstaked their holdings, while on Solana this unstake volume got done by a huge number of unstakers.

Summary

NEAR token price have done a better job compared to Solana in the recent week
NEAR has seen more % increase in the number of transactions in its network compared to the period before the volatility
NEAR has done a better job to keep Fees low in the volatility time compared to Solana
NEAR had much better performance to handle transactions in the difficult times compared to Solana.
In general, we didn't see a solid increase in the number of NFT buyers or Sellers during the volatility on both chains but to a smaller degree we can see NEAR NFTs saw a minor buy the dip opportunity while some minor sellers appeared on Solana NFT space.
NEAR network has seen a bigger unstake volume but far lower unstakers and Unstake transactions compared to Solana. This can be concluded that a small number of users with a big amount of $NEAR staking tokens have unstaked their holdings, while on Solana this unstake volume got done by a huge number of unstakers.