What is NEO?
Often nicknamed as ‘Chinese Ethereum,’ NEO is an open-source blockchain decentralized application platform that is very similar to Ethereum. It was founded in China by Da HongFei and Erik Zhang in 2014; its initial name was actually Antshares. In 2017 it was rebranded with the aim to offer “a smart economy by utilizing blockchain technology and smart contracts to issue and manage digitized assets.”
Similar to Ethereum, it supports its own cryptocurrency and allows users to develop digital assets and smart contracts. Its network works on a proof of stake (PoS), a decentralized (dBFT) consensus mechanism that operates between a group of centrally approved nodes and supports thousands of transactions per second (up to 10,000).
What can be developed on NEO?
There are a variety of options that applications who can develop on it, for example:
- Blockchain infrastructure: developers can contribute to the fundamental blockchain infrastructure.
- Digital assets: With NEO, you can create completely decentralized, safe digital assets that have no interference from third-parties. A digital asset is defined as “anything that exists in binary data which is self-contained, uniquely identifiable, and has a value or ability to use. are three main types of digital assets: cryptocurrencies, utility tokens, and security tokens.
- DeFi (decentralized finance): DeFi refers to digital assets and financial smart contracts, protocols, and decentralized applications.
- Games: On its platform you can create new genres of games that are completely decentralized and integrate blockchain features.
NEO describes its platform as: Digital Assets + Digital Identity + Smart Contract = Smart Economy
Users of the platform can digitize their assets on the NEO blockchain effortlessly with no intermediaries or their associated costs. Its users can purchase, record, circulate, and even exchange their assets; the platform can link physical assets with a corresponding and unique digital avatar on its network. These assets are legally secured as they have an authenticated digital identity that contains verifiable information regarding entities and individuals who participate in the network.
It uses smart contracts to execute transactions and agreements between different parties without the interference of central legal systems. Smart contracts allow traceability, transparency, and irreversibility of transactions.
What cryptocurrencies does it have?
NEO offers two crypto coins: NEO and GAS. 1 NEO is currently worth $11.52 and has a market capitalization of $812,254,649. Its max supply is 100,000,000 NEO, and currently, there are 70,538,831 in circulation. 1 GAS is currently worth $1.65 and has a market capitalization of $23,028,708. Its max supply is 100,000,000 GAS, and currently, there is 13,935,116 GAS in circulation.
Both tokens have particular uses on the platform:
- NEO tokens signify the ownership of its blockchain and are used to create blocks as well as manage the network. Users who hold NEO in their wallets will be rewarded with GAS tokens.
- GAS tokens give you the right to use the NEO blockchain. Similar to Ether on the Ethereum network, GAS is the fuel that powers transactions in its system.
What’s so special about it?
What sets it apart from other cryptocurrencies like Bitcoin and Ethereum are three unique aspects:
- NEO unified units: its shares cannot be divided, unlike Bitcoin, similar to company shares. This could be an issue if the coin increases in value, however, coin exchanges found some temporary solutions for this such as allowing to trade it in fractions.
- Generating GAS: NEO’s most differentiating feature is definitely its two-tiered system of NEO and GAS. They are interdependent, which means when users buy NEO and hold them in their wallets, they automatically start generating GAS. With every new block generated, 8 GAS are distributed for all the 100 million NEO that could ever exist.
- Smart contracts are transaction protocols that are self-executing with the terms of the agreement between buyer and seller clearly established from before.
Can you mine NEO?
Unlike other cryptocurrencies, which can be mined through specialized hardware and GPUs, it cannot be mined. The creators of the coin ensured that the 100 million coins got pre-mined prior to its release. The PoS protocol (proof of stake) offers to tackle the distribution process.
Instead of focusing on mining it, the platform focuses on offering an alternative cryptocurrency reward when holding NEO in their wallet.