A few weeks ago I finished a video on the NEAR Protocol, which is a new blockchain that is definitely not an Ethereum copycat like many other blockchains out there. Since then, I’ve learned that NEAR has a few more tricks up it’s sleeve, including its sidechain that features full EVM compatibility and almost a billion dollar incentive program. That EVM compatibility is a big deal for adoption though, so this video will be focusing on that.
Welcome to whiteboard crypto, the #1 Youtube channel for crypto education and here we explain topics of the cryptocurrency world using analogies, stories, and examples so you can easily understand them. In this video, we are going to explain what the Aurora blockchain is, how it ties in with the NEAR Protocol, and why you should care if you want to make money.
Quick Overview of NEAR
Near is a network that has been in the works for a few years. First, you can watch our entire video on it, but as a recap, NEAR uses a delegated proof of stake mechanism to verify new transactions. Along with this method, the developers termed a new idea they call Doomslug as a fast way to confirm these transactions with super quick finality and also a sharding mechanism that can process up to 100,000 transactions per second. One of my favorite things about NEAR is their DAO-like setup where they have Guilds, or groups of people who work on specific aspects of the NEAR Protocol, meaning that the community can easily contribute if they want. Also, recently NEAR announced an $800 million incentive program for users, which is going to be HUGE news when it launches and more applications move over. Since NEAR is built from the ground-up… developers have to start all over when designing applications, although they have a solution for this. The solution is pretty simple, and it’s to create a subnetwork that can run Ethereum applications on something called an EVM. They call this subnetwork Aurora.
What is an EVM? So now that we have that out of the way, let’s get into what an EVM is. This is important because it essentially is what Aurora is. EVM stands for Ethereum Virtual Machine, and to put it simply, it’s literally the same code that runs Ethereum and it’s smart contracts.
Many other projects out there have copied this code, changed it a bit, and then call it their own blockchain. For example, this is exactly what Binance Smart Chain, xDai, and Matic have done. Aurora is doing something similar as well, and you may be wondering why. The big reason is that developers don’t want to create projects for up and coming blockchains, they want to develop something for a big well-known blockchain.
The trick is that when you create a decentralized application for any EVM blockchain, you can easily move your code over to another network. To give you an example of this, AAVE is a dapp on ethereum, while GEIST is almost the same dapp on the Fantom network. Compound is another dapp on Ethereum, and CREAM is pretty much the same dapp on the Binance Smart Chain.
The first way that Aurora is different is that it chooses to use Ethereum as the native coin. The Polygon network uses Matic, the Binace Smart Chain uses BNB, and the Fantom Network use FTM, this way they have their own coin with different tokenomics to support their network. Aurora knows they don’t need a new coin, and even choose not to use the NEAR coin, which was a big move.
Aurora Layer 2 Scaling
Moving on, let’s get into the specific numbers of Aurora. The average block time is around 1.03 seconds, and the finality is 2 seconds, which is very, very fast. The typical transaction cost is a penny or less, and using the NEAR consensus mechanism, they can process hundreds of transactions per second super easily. Oh, by the way, Aurora isn’t it’s own blockchain, it is literally just a smart contract on the NEAR protocol. This means it inherits it’s blocktime and consensus mechanism from the NEAR network, which is amazing and I’ve never seen any other network attempt or achieve something like this. This layer 2 scaling solution is literally just a smart contract on the main chain.
Other Unique changes
In contrast to many other sidechains, Aurora does not validate blocks off-chain. All the validation happens on the actual Ethereum and NEAR blockchains. This means that all the users need to trust is the Ethereum and NEAR blockchains consensus mechanisms, which makes Aurora and its bridge fully trustless and decentralized.
Aurora is actually a smart contract on NEAR, and it is the solution to extend Ethereum economic features to the NEAR network. It works on top of NEAR blockchain, though provides the familiar experience of Ethereum for devs. Developers are able to take their Solidity contracts, deploy them on Aurora and enjoy the low cost and fast confirmation time of NEAR blockchain.
The fact that Aurora is a smart contract is a huge plus for the team that develops Aurora: they don’t need to take care of Consensus, Validators, Storage, Network, etc. It means that they can iterate quickly and deploy new features insanely fast.
If you don’t know what a DAO, or decentralized autonomous organization is, go check out our video on it because we know you’ll understand this next part much better. Essentially, a DAO is an organization where the decisions are made by token holders and not elected CEOs or family-members who were grandfathered into a corporate position.
Token holders can propose and vote on new ideas and changes, and that’s the main way that Aurora will grow and improve. If you own and hold the Aurora token, you’ll be able to participate in this decentralized governing process. The best benefit of a DAO is that the surrounding community and actual investors are who get to decide on big changes, so you know they have pure intentions of making the network the best it can be in a long-term time frame.
We all know that one of the largest problems in cryptocurrency is interoperability, or the ability to connect a bunch of blockchains. Aurora actually has it’s own Rainbow Bridge, which is what they are calling the tool that you can use to transfer your tokens to and from the Aurora AND Near networks.
This means you can easily move your funds from the Ethereum blockchain over to the NEAR blockchain or Aurora whenever you want, and without trusting a third party, the transfer is all done with code.
I’ve personally used the NEAR network and interacted with a few financial applications and have to say they have a lot of good things going for them. Instead of metamask, NEAR technically uses your whole browser as a wallet. They also have human-readable addresses like WhiteboardCrypto.near instead of a bunch of pseudorandom numbers that make up your wallet address. I’m definitely interested in trying new things on the Aurora network and seeing what comes of it.