Near Protocol (NEAR) Sees User Exodus as Network Demand Drops to March Lows

The daily count of unique addresses transacting on the Near Protocol began to drop on July 30. It peaked at 2 million addresses that day and has fallen by 43%.

Near Protocol (CRYPTO: NEAR) has seen a significant drop in user activity, with daily active addresses and transaction counts declining since late July.

What Happened: According to on-chain data, the daily count of unique addresses transacting on the Near Protocol began to drop on July 30. It peaked at 2 million addresses that day and has fallen by 43%.

Fewer users on a network typically lead to a decline in transaction count. Assessed using a seven-day moving average, the daily number of transactions on the NEAR blockchain has fallen by 36% in the past month.

The drop in user activity on the Near protocol is also reflected in the declining total value locked (TVL) within its decentralized finance (DeFi) ecosystem.

Since July 17, Near’s TVL has steadily decreased, hitting a five-month low of $172 million on August 6. While the TVL has since rebounded to $206 million, it still represents a 26% drop over the past 30 days.

"We can see that activity on the L1 has dropped to its lowest level since March, with daily active addresses and transaction counts both declining significantly. This is likely due to the broader crypto bear market, which has seen demand for L1s wane," an analyst at Artemis noted.

Moreover, activity across the decentralized exchanges (DEXes) housed within the L1 has also been impacted. Artemis' data shows this has fallen 54% over the past 30 days.

Due to the low demand for Near, its fees and the revenue derived from the same recently fell to seven-month lows. On August 11, the total fees for using Near fell to $11,000, while network revenue was $9,000. These figures represent the protocol’s lowest since February 10.

NEAR Price Prediction: As of this writing, NEAR trades at $4.26. Although the coin’s price has surged by double digits in the past seven days, it may be unable to extend these gains.

On a one-day chart, NEAR's price movements show that the altcoin is trading below its Ichimoku Cloud. The Ichimoku Cloud helps identify trend direction, gauge momentum, and determine critical levels for an asset.

When an asset’s price drops below the cloud, the market trend turns bearish. Trading below the cloud suggests that the price is under both short-term and long-term averages, indicating weakness in the trend.

If NEAR falls further below these key levels, its next price target is $3.07, representing a 28% drop from its current price level.

However, if the altcoin rallies past the “cloud,” it may trade at $5.30.