What is NEO?

What is the cryptocurrency NEO?

The History of NEO

The history of NEO starts in early 2014. In a meeting at the Chinese headquarters of Microsoft, the China-based company Onchain presented Antshares, which would be China’s first public open-source blockchain project. Onchain was already known within the blockchain industry, as they provided the framework for blockchain technology in the private and governmental sector in China.

Antshares and Onchain

Antshares was presented as the blockchain for the public sector. Almost unexpectedly, it quickly grew and became a direct competitor of Ethereum. It is important to mention that Onchain and Antshares are owned by the same people, but are funded differently, making them separate entities. The difference lies in the fact that Onchain is funded by institutional money, whereas Antshares is community funded.

The Antshares ICO

The Antshares ICO or Initial Coin Offering, which is a crowd-sale used to fund the project, was completed in two phases. In 2015, private investors already began investing in the digital asset ANT. The public sector joined in 2016 and started investing in Antshares as well. Both sides helped developers push the Antshares project to further stages of development.

Onchain’s Partnerships

In the meantime, Onchain had started a cooperation with Hyperledger and Microsoft. These partnerships have helped push the development of NEO and drove the project into the right direction. In early 2016, NEO developers published the first whitepaper that covered the concept of the dBFT protocol. DBFT, which stands for delegated Byzantine Fault Tolerance, is the consensus mechanism in the NEO blockchain, which ensures that everything that happens on the blockchain goes according to protocol. In June 2017, Antshares was officially re-branded to NEO with the catchphrase: “Wake up, NEO”.

Specifications of NEO

Ticker Symbol NEO
Founder(s) Da HongFei & Erik Zhang
Date of Release February 2014
Consensus mechanism Proof of Stake
Hashing Algorithm Delegated Byzantine Fault Tolerance
Maximum supply 100.000.000
Average Block Time 15 – 20 seconds
Mining reward 1.5% yearly
Average blocksize 10 kb
Next Block Halving n/a
Smart Contracts Yes, in C#, Java & Python

The Price of NEO

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Unique Aspects of NEO

NEO was built to create a foundation for a smart economy within an open-source system. Most simply put, a smart economy is an economy which automates the management of digital assets through smart contracts. Thanks to their cooperation with the Chinese government, NEO was able to quickly integrate their smart economy in Asia and spread through the world.

Neo tokens and Gas

When the NEO digital currency was created, over 100 million tokens of NEO and GAS were generated. The tokens and the gas were initially known as Antshares and Antcoins. Anyone who buys NEO tokens basically buys a share in the NEO blockchain. These shares can be used to generate GAS which is used to fuel the network.

NEO Governance

Every owner of a NEO share has the right to vote on rules within the network, cementing its reputation as a community-based currency. All NEO token holders vote on the protocols and rules within the network until they reach a consensus. The consensus is reached when two-thirds of the delegates(nodes) on the network can agree with a speaker’s (bookkeeper) copy of the blockchain. If consensus cannot be reached, the network will appoint a different speaker and attempt to reach a new consensus.

How GAS Works

If users have NEO in their wallet, they are rewarded with GAS in relation to the amount of NEO they are holding. GAS makes it possible for people to use the network, which makes NEO similar to Ethereum. Creating smart contracts or releasing dApps would require GAS. Therefore, without GAS, participants cannot take any action within the system.

Why Use NEO?

The three main reasons why you should use NEO are digital assets, digital identity, and smart contracts. We will cover each below:

  1. Digital assets: If users have NEO in their wallet, they are rewarded with GAS in relation to the amount of NEO they are holding. GAS makes it possible for people to use the network, which makes NEO similar to Ethereum. Creating smart contracts or releasing dApps would require GAS. Therefore, without GAS, participants cannot take any action within the system.
  2. Digital identity: NEO offers the possibility for securing identity on their platform, which is a great benefit for companies and individual users. Company or personal information on the NEO platform can be secured with safety measures such as two-factor authorization, face recognition, fingerprint, voice recognition or by SMS. The two-factor authorization requires users to confirm their logins on more than one device, which makes it difficult for hackers to gain unauthorized access to their information. Face recognition, fingerprints, and voice recognition are typical biometrics that can improve the security of data online.
  3. Smart contracts:Lastly, the creation of smart contracts makes it possible for companies to use digital contracts. With smart contracts, terms and agreements can be programmed into the contract more easily and more efficiently. Smart contracts created on the NEO blockchain can be written in multiple programming languages, which makes room for a larger development community. The programming languages currently used by NEO include C#, VB.Net, F#, Java, Kotlin and Python. As the community grows, we are expecting to see more languages being used within NEO.

Conclusion

Overall, NEO offers the kind of functionality that proves to be effective in creating smart contracts and forming transactions. NEO’s innovative technology and approach to smart contracts are contributing to the advancement of a smart economy, which is paving the way for future developments in the blockchain industry.