Updated: Dec 20, 2019
Popularly hailed as China's answer to Ethereum and its first blockchain platform, NEO is a decentralized open-source platform supporting a native cryptocurrency, which attempts at enabling digital assets, smart contracts development and creation of decentralized apps (Dapps). The decentralized platform’s ultimate goal is to create a “Smart Economy".
This guide will explain the purpose for which NEO was designed for, the team behind it, how it works and its uses and applications.
What Is NEO Designed For?
The NEO blockchain platform permits physical asset linking with a corresponding digital avatar on its smart network. It provides security for the protection of such assets and enables coding for the creation of high-end user projects involving high volume transactions. Further, it supports the development of smart contracts and digital assets all the while, adhering to the restrictive Chinese government regulations.
It was designed to adopt a centralized regulator friendly approach to blockchain technology, which sets it apart from most other cryptocurrencies. NEO users can buy sell, record, exchange, and circulate assets on its platform using its crypto coins, NEO and GAS.
The creators developed NEO as the answer to Ethereum’s inflexibility in face of heavy bans by the Chinese government on blockchain technology. It was designed as a bridge between the past and future of blockchain technology in China and other Asian markets.
Who Is The Team Behind NEO?
Formerly known as Antshares, NEO was designed by the duo - Da HongFei and Erik Zhang in 2014 as the answer to China's restrictive environment.
Da HongFei is hailed as the pioneer of cryptocurrency applications and blockchain technology in Asia. He was the official Chinese government consultant, for the country’s smooth ambitions for blockchain technology development after cryptocurrency exchange, and ICO was banned.
How Does NEO Work?
There is still confusion regarding the NEO platform since some of its aspects continue to being developed, while other core concepts remain unclear. That being said, fundamentally NEO works on the same concept as Ethereum. Its smart contract ecosystem allows automated storage and exchange of digital assets in compliance with the various legal regulations, to achieve its ultimate goal of a smart economy.
NEO's smart network is based on a stakeholding, decentralized Byzantine fault-tolerant (dBFT) consensus mechanism, supported by centrally approved nodes. This framework can carry out 10,000 transactions per second. NEO’s concept was designed to support large scale commercially-run projects.
The base asset of this digital platform is an indivisible NEO token, which in turn creates Gas tokens. The Gas tokens are a separate asset and can be used for transaction fee payments. A decaying algorithm controls the Gas token inflation rate, and it is estimated that in 22 years (about) 100 million such tokens will be released.
At its core, NEO proposes both efficient scaling and deployment of smart contract applications on its blockchain network. The smart economy system of NEO is described as a combination of digital assets, identity, and smart contracts.
Smart contracts allow transactional execution and multi-party agreements, without any legal governance or central mechanism. The programming code of the network allows for the execution of such contracts while the coding offers transparency, traceability, and irreversibility of transactions.
In 2014 NEO led to the development of Onchain, an independent technology, which works within the legal framework to provide blockchain solutions.
What are Current and Future Applications of NEO?
NEO aims at creating a smart economy that provides asset digitization within a trusted network. It provides a platform for Dapps development aimed at solving real-world complex problems.
Some of its more noteworthy applications are:
This is a cryptogenic trade platform that ensures efficient and effective trading across the different blockchains. It has the potential to work with both NEO and Ethereum.
It is an ad network based on the blockchain. Adex initially started with Ethereum but later switched to the NEO network. There are no fees or commissions on Adex and reporting is transparent.
This is a decentralized platform dealing with market intelligence. It facilitates open research. NEO enables transparency and accuracy in its content.
The Key is an identity verification tool that works within the blockchain. It uses multi-dimension identification (BDMI) and Personally Identifiable Information (PII) to verify everyone added to the blockchain. It aims at identifying people and assets using blockchain and National Big-data.
Zeepin is working towards building a distributed new technology aimed at the creative industry. It facilitates copyright, crowdfunding, and talent recruiting among others.
Apart from these applications, NEO is also an accepted mode of payment at Guardium (an emergency response network) and Travala (a global travel booking marketplace).
The platform allows new developers to create Dapps without the need to learn any new programming language, which substantially cuts on the development costs and is one of the major reasons behind NEO’s success in the decentralized app space.
NEO has already realized its goal of facilitating large scale commercial applications. The improved NEO consensus algorithm and dBFT are both near completion, providing the platform with one of the best consensus mechanisms for blockchains.
Since its inception in 2014 as Antshares and subsequent rebranding as NEO in 2017, the crypto coin has succeeded in realizing its vision of a ‘smart economy’. It has successfully developed some of the most effective smart contracts and has the potential to dominate the Asian market.