NEO is one of the top coins that run on the Ethereum blockchain, aimed at resolving a lot of things that are wrong with Bitcoin. Buterin first released Ethereum’s whitepaper in 2013 and its crowdsale was launched in July 2015 which raised more than $18million USD. Around the same time, a Chinese version of Ethereum known as Antshares was launched by OnChain, a non-profit Blockchain project in Shanghai.
In June 2017, the project was rebranded and is now known as NEO. The NEO platform supports smart-contracts and is very popularly known as the “Chinese Ethereum” due to the similar functionality offered by both the platforms. While NEO coin does share a lot of features with Ethereum, like support for ICOs and dApps, a major benefit of the platform is its compatibility with languages like C/C#, Java, and GO. Ethereum, on the other hand, only supports its own Solidity language.
NEO coin is currently the 12th largest cryptocurrency as per CoinMarketCap and rose to a massive 500,000% in 2017. But with that being said, cryptocurrency prices are notoriously popular for their volatility and the value of NEO tokens have considerably fallen in the last 6 months.
At its current price, is NEO coin a good investment? Knowing more about its history, underlying technology, and the team behind the project might help you decide.
History of NEO Coin
As per its official website, NEO is a non-profit blockchain-based project which uses the blockchain technology along with digital identity for digitizing assets, automating digital asset management with the help of smart contracts, and realizing “smart economy” through a distributed network.
OnChain, the company behind NEO coin was founded by Da Hongfei (CEO) and Erik Zhang (CTO). The project began around 2014 as AntShares and was rebranded to NEO in 2017. A two-part crowdsale was organized in 2015 to fund the project. 17.5 million AntShares tokens were sold in the first crowdsale and the remaining 22.5 million tokens were sold in the second part.
What is NEO coin?
In simple words, NEO is a blockchain platform which can be used for creating smart contracts and digital assets just like Ethereum. Unlike most other projects which involve a single cryptocurrency powering the entire project, NEO has two native tokens- NEO and GAS. Both the tokens play different roles on the NEO blockchain platform.
The NEO tokens are used for representing ownership on the NEO blockchain. Creation of blocks and network management is done with the help of NEO tokens. On the other hand, GAS tokens enable users to use its blockchain. Just like Ether which is the fuel for Ethereum network, GAS too is a fuel which powers the transactions of NEO network. As a matter of fact, users can earn GAS by just holding NEO coins in their wallets.
The main goal of the project is to be a distributed, decentralized, and digital platform for assets that are non-digital in nature with the help of smart contracts. For instance, it can be used for creating a smart contract to pay monthly rent. Rather than using a bank for the payment, the contract can be created in a way that it triggers once every month.
How Are NEO Smart Contracts Different from Ethereum Smart Contracts?
If you are new to cryptocurrency and “smart contract” seems like an alien term, understanding the basics would help you understand NEO’s Smart Contracts 2.0.
To keep it simple, smart contracts are nothing more than digital versions of actual contracts. These digital contracts use the blockchain technology and are executed when the pre-defined conditions are met. For instance, a smart contract can be created between a seller and buyer which would trigger delivery of a product once the buyer pays for it. If at all, the seller does not deliver the product, the amount can be refunded to the buyer.
The B2B implications of smart contracts are huge and make cryptocurrencies much more than just a store of value or a digital currency.
While the smart contract is one of the most important reasons for Ethereum’s popularity, NEO cryptocurrency has the potential to beat the second largest cryptocurrency with the upgraded version of smart contracts. Dubbed as Smart Contracts 2.0, it provides an easier platform for the programmers which consumes lesser amount of resources and boots up quicker.
While Ethereum blockchain can only be used with its native Solidity language which a lot of programmers do not know, NEO coin can be used with C/C#, Java and Go which are very commonly used. The platforms compatibility with multiple languages makes it easier for the programmers to deploy contracts and develop digital assets on it. While it was Ethereum that introduced Smart Contracts to the world, NEO has significantly improved it.
NEO coin vs. Other Cryptocurrencies
NEO is not only different from Ethereum and Bitcoin but several other cryptocurrencies too. Some of the noteworthy differences are-
NEO is indivisible: A NEO token cannot be divided into smaller units like other currencies. For instance, you cannot buy 0.5 NEO but you can buy 0.5ETH or 0.5BTC. The NEO tokens are indivisible as rather than being a cryptocurrency, the team behind the project considers these tokens as shares of a company.
This became a problem when the value of NEO crossed $160. But the crypto exchanges were quick to find a solution. While this is not a foolproof solution, it does let you buy smaller fractions of NEO from exchanges. However, the catch is that only whole NEO tokens can be sent from an exchange to a NEO wallet. For instance, if you are buying 1.2 NEO, you can transfer 1 NEO and the remaining 0.2 NEO will remain in the wallet of your exchange.
GAS generation: Another major difference is the two native tokens of the NEO ecosystem. While the NEO token gives you ownership on the NEO blockchain, GAS is the fuel powering NEO transactions. While there are a few exchanges where people can buy GAS token, most of the users simply buy NEO and store it in their NEO wallet to earn GAS for free.
However, it doesn’t really make sense to hold just a few NEO tokens in your wallet if you want to earn GAS. As per NeoToGas.com, a popular NEO GAS reward calculator, 100 NEO tokens would only bring in about 10 GAS tokens in a year. While the reward is low, it is definitely one of the most important things that differentiate NEO from many other currencies.
NEO network governing: The NEO blockchain has two types of nodes- consensus nodes and ordinary nodes. Also known as bookkeepers, the consensus nodes maintain the ledger and provide accounting services. The ordinary nodes are responsible for the NEO transactions. Unlike most other currencies which use PoS (Proof-of-Stake) or PoW (Proof-of-Work) mechanism, NEO uses dBFT (Byzantine Fault Tolerance) algorithm.
With the NEO blockchain, the nodes do not compete for creating blocks as there is no reward for block creation. The consensus nodes are single-handedly responsible for validating transactions and these nodes are voted in by NEO holders. However, currently there are 7 active NEO consensus nodes and the NEO team controls them. So, it is not wrong to believe that the NEO network is currency centralized.
Team behind NEO coin
As discussed above, OnChain developed the NEO network. The team is led by Da Hongfei (CEO), Erik Zhang (CTO), Tony Tao (Founding Partner), and Weiyu Zhu (Managing Partner).
As per a Reddit discussion, there were only two developers who worked on the NEO code initially. However, when the NEO team updated their website, they listed 1 front-end developer, 1 engineer, and 4 developers. Currently, the official NEO website suggests that they have a community of contributors, operators, and developers.
NEO Price Fluctuations
While NEO started 2017 around $0.14, it reached almost $200 in January this year and is currently trading around $29 which means a fall of more than 80% in just 6 months. As per CoinMarketCap, it has a market cap of $1.937 billion and 24-hour trading volume of $54.92 million. While NEO delivered unbelievable returns in 2017, as far as the price of NEO is concerned, 2018 doesn’t look that amazing so far.
However, the sharp fall is not really because of NEO. The whole crypto market has somewhat crashed and the largest cryptocurrency, Bitcoin, which reached $19k in December last year is currently trading at $6,092, a fall of more than 66%.
As a matter of fact, things are going great for NEO. Last year, OnChain partnered with e-King Technologies, Fosun Group and even Guizhou government on many different blockchain-based projects. A few ICOs have already been launched on the NEO platform and many others are slated for release this year. Bookmark this NeoNetwork webpage to keep yourself updated about the latest ICOs on NEO.
If things continue to move forward in a similar manner, NEO is expected to be one of the top gainers when the market starts to recover.
Should You Buy NEO coin?
Most crypto experts agree that at $29, NEO is a steal. The project has survived the complex regulatory environment of China and even after the government’s crackdown on the cryptocurrencies; NEO has not just thrived but has become one of the top digital currencies.
The founders have time and again mentioned that they are carefully following the government regulations to ensure that they are prepared for the future. If there is one Chinese crypto project which has the potential to make it big in future, it definitely has to be NEO.
If you are looking for a long-term investment, buy NEO cryptocurrency and just hold on to it. You can even stake your NEO tokens to earn GAS for free. While the reward is minimal, it definitely is better than nothing.
How to Buy NEO coin?
As NEO is one of the top cryptocurrencies, you can buy it from a number of top crypto exchanges. Some of the most popular options are Binance, OKEx, KuCoin, Bitfinex, CoinEgg, BitForex, Exrates, CoinSuper, and Huobi. Moreover, some of the exchanges also allow you to stake your NEO coin right from the exchange wallet to earn GAS.
However, it is highly recommended that you transfer your NEO coins after buying to your NEO wallet. You can find the official NEO wallets on the NEO website. There are desktop wallets, web wallets and mobile wallets available.
The answer is out there, NEO
NEO is an upgraded version of Ethereum in many aspects and has grown beyond imagination in 2017. It is backed by a solid team which is pretty transparent about their operations. Many new ICOs have started adopting the NEO platform and the team is constantly working on new partnerships.
If you are looking for a reliable blockchain project with great potential, you should definitely consider NEO. While the Chinese authorities and their attitude on cryptocurrencies is one of the biggest risk factors for NEO, the team has been able to survive till now and will probably continue doing so in future too.
Invest wisely and only invest an amount that you can afford to lose. Once you’ve purchased NEO coin, just sit tight and do not panic as the market runs its course.
Image via Shutterstock and Coinmarketcap
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