What is NEO?
Launched in 2014 by developer Da Hongfei and Erik Zhang, NEO is an open-source blockchain-based platform for decentralized applications and smart contracts. The same duo founded the Onchain, a Shanghai-based blockchain company. The technology company offers blockchain solutions to various businesses.
Formerly named Antshares (ANS), the cryptocurrency later rebranded to NEO in June 2017.The NEO platform enables the development of smart contracts and Dapps.They aim to build a Smart Economy system using digital assets, digital identity, plus Smart Contracts. The NEO network envisions its Smart Economy System as follows: digital asset+ digital identity+ smart contract= smart economy.
Often called the "Chinese Ethereum," NEO is the first decentralized open-source cryptocurrency created in China.NEO is a regulatory-compliant blockchain platform, which makes it in good terms with the Chinese government.
The NEO network allows people to digitalize their physical assets using the blockchain technology. You could now buy, sell, record, or exchange many kinds of assets. Once registered on the NEO network, the assets will be assigned a digital identity and protected by the law. Moreover, every user (individual, businesses, nodes) on the NEO network has to have valid digital identification.
NEO blockchain developers are continually developing new tools to support the creation of more decentralized apps such as decentralized exchanges, legal smart contracts, or smart funds.
The good news for developers around the world is that NEO doesn't require you to learn additional programming languages. The network allows you to develop new applications by using mainstream coding languages such as Java, C++, Go, etc.
What more,as an NEO holder, you will automatically acquire the voting right on how things are run on the NEO network. You will be able to vote in validators in charge of verifying new transactions on the blockchain.
Like Bitcoin, transactions on the NEO blockchain are traceable and transparent. Also, similar to many blockchain-based platforms, transactions on NEO are irreversible. It means that once your smart contract is deployed on the blockchain, it cannot be undone; therefore, developers need to be extra careful while writing the codes to their decentralized apps.
NEO funded its project via two ICOs. The first crowdsale or ICO happened in October 2015 and lasted for ten days. In that period, the project managed to raise $550,000 by selling up to 17.5 million NEO tokens. During the second crowdsale, they sold the remaining 22.5 million NEO tokens for $4.5 million.
A total of 100 million tokens were pre-mined in the Genesis block, which means that there is no mining on the NEO blockchain as all the coins are already created. 50% of the created coins were distributed to early investors; the remaining 50% is locked to fund the platform’s long term development goals.
For early investors who invested in NEO, the crypto provided a massive return of investment of over 2500%.
Significant businesses are currently using the NEO blockchain in China, such as Alibaba, Microsoft China. It makes NEO trustworthy and a better choice for investors, companies, and developers.
How Does it work
The NEO network has three components that differentiate it from other smart contract cryptocurrencies like Ethereum:
1. Digital asset:
The NEO blockchain aims to transform traditional assets into digital assets and store them in the blockchain. The converted assets will then be protected using digital certifications. They want to decentralize activities such as buying/selling a property or trading stocks. These activities are mostly carried out by centralized entities like law firms or exchanges in case of trading stocks. NEO project is to allow individuals to be in full control of their assets, be able to exchange them safely without a third-party.
2. Digital Identity:
NEO plans to create a digital identity for each of its users, whether it's an organization or an individual. Each digital identity will be unique, much like your fingerprint. Neo will be using multi-factor authentication mechanisms to verify the electronic information of its users, including fingerprints, facial/voice recognition, and SMS.
3. Smart contracts:
As the name suggests, smart contracts are contracts programmed to automatically fulfill agreements between two or more parties once the terms are reached. For example, if you work with affiliate marketers, you can set up an automatic payment each time they successfully sell your products. Once the contract executes, the pre-fixed amount of money will be transferred from your wallet to theirs. Regulators will verify this transaction on the NEO blockchain under the NEO consensus mechanism.
The NEO network runs on a unique proof-of-stake consensus mechanism named dBFT. The mechanism allows participants (Neo token holders) on the NEO blockchain to delegate nodes that will verify transactions and carry other activities on the network. The delegates are called bookkeeping nodes.
To become a bookkeeping node, you need to own at least 1000 GAS, be equipped with specialized hardware, and have full access to the Internet. In the case where a delegate node is not doing his job correctly, he will be voted out and replaced.
The owners of NEO tokens hold the rights to manage and secure the network. If you own NEO coins in your crypto wallet, then you will have the right to take part in various activities on the NEO blockchain such as verifying transactions, bookkeeping, accounting, change parameters, etc.
Neo Blockchain's Cryptocurrencies
The network boasts two native cryptocurrencies including NEO (former AntShares) and GAS (former Antcoin):
NEO cryptocurrency is not divisible, with the smallest unit being 1. It means that you can't transfer like 0.6 NEO or 1.5 NEO.
Any NEO holder is eligible to a certain amount of GAS tokens following how much NEO coins he owns.
As of December 31st, 2019, NEO ranks 19th with a market cap of approximately $631.3 million. The NEO has a circulating supply of 70.5 million coins. One NEO token currently costs $8.95
As the name suggests, the GAS token is used to fuel smart contracts and other activities on the NEO blockchain.The owner of GAS tokens can develop Dapps and execute smart contracts on the blockchain.You can earn GAS tokens only by owning NEO coins in your wallet.
The use of Gas is similar to which of Ether on the Ethereum’s blockchain. Developers use GAS to deploy their Dapps on the blockchain or pay for other transaction fees on the NEO network. It is more like the currency exchange within the NEO ecosystem. Also, the more GAS you are willing to pay, the faster your transaction.
What more, Gas is used to incentivize the validators/bookkeepers for their work at managing and protecting the network.
Unlike NEO, GAS can be divided into eight decimal places.The GAS crypto has a cap limit fixed at 100 million, which the crypto is expected to reach in 2240.
One Gas costs $0.9 on the crypto market. There are approximately 10.1 million Gas tokens in circulation in the time of the writing.
The difference between NEO and GAS is that NEO coins have already been mined in the genesis block creation.
You can get NEO coins from exchanges like e-Toro, Binance, Bitfinex, Huaobi in trade with other cryptocurrencies like BTC, ETH, LTC, etc. Bitfinex allows you to exchange your USD for NEO tokens. You can also buy NEO coins from CoinSwitch in exchange for USD.
GAS tokens can also be bought on various exchange platforms.
Where to Store your Neo Coins
You will need a digital wallet to hold your newly acquired NEO crypto-coins if you don't own one. Make sure to select a NEO-compatible wallet if you want to generate GAS. You can choose between following cryptocurrency wallets:
1. A desktop wallet allows you to store your private and public keys on a file on your desktop computer. The public key will be used when you want someone to send you money, meaning that you can share it with anyone. A private key, on the other hand, will allow you to access your funds and is not be shared with anyone. On the NEO platform , you will be able to find multiple desktop wallets compatible with various operating systems (Windows, macOS, Linux). You can download your favorite digital wallet and store your NEO tokens. However, you can only access your funds from the computer on which you made the download. NEO coin holders can choose between the NEON Wallet, NEO Cli, Zelcore Wallet, and so on.
Furthermore, the NEO walletsallow you to claim your GAS tokens automatically.
2. A web wallet is cloud-based and will enable you to access your funds from any device. All you have to do is enter your private key combination. You can choose from many web-based wallets available on the NEO platform, including NEO Tracker, Magnum, NeoLogin, etc.
3. A paper wallet is known as a piece of paper where the private and the public address are printed. Once you print out the paper, make sure it is stored in a safe place because you will need the keys to send or receive funds. It is important to note that you won't be able to claim your Gas tokens while using the paper wallet.
4. A hardware wallet will be a better choice if you plan on holding your coins for the mid or long-term. The NEO platform allows its users to choose from the Ledger Nano S, the Ledger Blue, SafePal, etc.
5. NEO users can also store their funds on mobile wallets for faster access. For that, the platform proposes a wide range of mobile wallets, including NEO Line, Spatium, O3 Wallet, and so on. NEO mobile wallets are compatible with both iOS and Android devices.
Briefly, NEO is a blockchain-based platform where users can build decentralized applications and execute smart contracts.Their platform allows you or your business to keep your assets in a decentralized environment, safe, and free of a third party.
NEO is a fantastic project with a lot of potentials. It plans to compete with Ethereum at becoming the best blockchain-based platform on which digital assets and smart contracts are built.
NEO’s proof-of-stake consensus makes the network more scalable and trustworthy. The NEO blockchain can support up to 10.000 transactions per second. Besides, the NEO platform reduces the time and cost for developers to learn new programming languages.
Furthermore, NEO has a strong development team, and it allows its participants to vote on new updates for better governance.
Nonetheless, the platform does show a few weaknesses:
1. Many people complain that the NEO coins aren't divisible. They fear that as the currency gains value, they won't be able to purchase them within their budget. For example, if one BTC costs $8000, you could still buy 0.0005 BTC for $4. However, you wouldn’t be able to do this with NEO coins. For instance, if the NEO price goes up to $100 per coin, you would have to spend your $100 bill to own NEO in your wallet.
2. The NEO project is backed by the Chinese government and focuses on regulatory compliance, which attracts many legit businesses. However, China is notoriously known for its strict regulations, which will probably affect the NEO's exposure to the western world.
3. Also, NEO has to surmount the issue of competition against other powerful smart contract platforms like Ethereum and Cardano.
NEO was first traded on September 6th, 2016, at the price of $0.18 per token.
NEO started to gain popularity in June 2017, where it went from $1 to $9 in a few weeks. In mid-August, one Neo was valued at $48. Even though the price declined shortly, the crypto showed steady growth throughout the rest of the year. On December 18th, 2017Neo’s price reached a new high of $80. In January 2018, the crypto reached its all-time high of $160.
However, in April 2018, the Neo price declined to less than $50. On May 3rd, the price shortly jumped back to $84. Unfortunately, the Neo price has since dropped to less $10 until today.The Chinese government announcement on banning cryptocurrency and ICOsalso affected the NEO's price at the moment.
NEO’s price, like any other cryptocurrency, highly depends on the supply and demand. As the demand goes up, the price automatically rises, and vice versa.Therefore, many people still believe in the NEO blockchain mission and that businesses and developers will soon adopt it, which will raise the price. Again, NEO gives developers the ability to use common programming languages, which makes it very in-demand.
On a special note, keep in mind that cryptocurrencies are complex instruments and highly volatile, thus involve high risks. Their future performance is unpredictable and depends on various factors like supply & demand, news, regulations, updates, etc.
If you are interested in this promising crypto, you can join the NEO communities all over the Internet for updates: NEO Reddit, NEO Blog, NEO on Slack, etc. You can also find news on Chinese social media platforms like Weibo and Wechat