Many people may have come accross NEO (Antshares) as they were doing their cryptocurrency research. Perhaps some own it as part of their cryptocurrency portfolio. Many just assume it is a “Chinese Ethereum” and invest based on that.
Indeed, it was only when they changed their name from Antshares to NEO and started focusing on the English press did their price rally. This occurred in the middle of 2017 and people were introduced to the concept of the “smart economy”.
NEO’s unprecedented rally in 2017 – Source: coinmarketcap.com
Given the fact that the NEO worked on a smart contract basis, people started thinking of it as the Chinese Ethereum. At the time, this helped a great deal with the marketing of the coin. People put together one of the hottest coins and one of the hottest markets and a dream Altcoin investment came about.
However, could NEO be much more than just a “Chinese Ethereum”?
NEO Benefits over Existing Technology
NEO incorporates some of the most advanced concepts in modern cryptography and blockchain technology. This has allowed them to provide numerous benefits and solve a number of problems that are associated with traditional eco systems.
If there is one thing that was a constant theme last year it was the notion of network scaling. Bitcoin was plagued with large amounts of uncomfirmed transactions and exorbitant fees. This led many in the community to propose a hardfork called SegWit2X which eventually failed.
There were also scaling issues that plagued the Ethereum blockchain. What was built to be a robust blockchain that could handle thousands of dApps (decentralised applications) was eventually brought to its knees by a dApp called cryptokitties.
This application clogged up the network and caused quite a bit of consternation in the community. So much so that the Ethereum foundation has publicly announced a grant for developers to work on scaling the ethereum network.
This is not something that NEO has ever had to deal with. In fact, taking by making use of concepts called concurrency and sharding, NEO is able to process at least 10,000 transactions per second. Compare this to the 15 transactions Ethereum can handle or the paltry 3 transactions that Bitcoin is able to process, one can see the immediate benefits of NEO.
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Unique Consensus Method
Last year was also a year of many forks in popular blockchains such as Bitcoin. You had the Bitcoin cash, Bitcoin Gold and Bitcoin Diamond amoung others. This is usually done when there is a disagreement for solutions going forward.
When there are these disagreements, these forks are usually the only solution. This is because of the way that the transactions are processed and consensus is reached. In the case of Bitcoin, proof of work (PoW) mining is used.
NEO, on the other hand, uses something completely different. The consensus method that is used by NEO is something called Delegated Byzantine Fault Tolerance. The explanation of exactly what it is is quite involved and you can read up more but the key point to understand is that it is able to prevent code forks.
This is no doubt a positive for the NEO stakeholders. Although code forks result in more than one coin and blockchain, they are sometimes contentious and can impact on the long term prospects of both forked coins.
Safe from Quantum Computers
If you ask any technical cryptocurrency user and ask them one of the foremost threats that they see in the future, quantum computers are likely to get mentioned. Such machines with massive leaps in computing power could undertake an infamous 51% attack.
Indeed, this is something that was recently theorised by a scientist at MIT as he took a look at the impact of quantum computing on Bitcoin. The theoretical exercise showed that it was a severe threat.
Although quantum computers are still quite some time away, no one wants to know that there coins could be at threat sometime in the future.
However, for the NEO “hodler”, they can sleep easier at night. It is quantum computer proof.
Numerous Language Support
One of the other great benefits that NEO has is the amount of langauges that it supports. Unlike Ethereum which relies on its own language, Solidity, NEO has support for some of the most popular languages including C#, C++, Java and Python amoung others.
This is obviously really advantageous from a development perspective. It means that developers who currently code in these languages can code a dApp in a language that they understand. The NEO protocol can compile these languages into instructions for the virtual machines.
In the case of Ethereum, they would have to devote considerable resources to learning the new language even though they are already extremely profecient in another language.
Much like Ethereum, NEO can be used as an ICO to launch their own tokens off of their blockchain. In 2017 there were a number of startups that raised their inital funds making use of the Ethereum ERC-20 tokens.
NEO makes use of the NEP 5 token standard and there have already been a few ICOs that have raised their funds with this token. Of course, the ban by the Chinese government of ICO activity had a bit of a knock on the activity but it is expected to pick up in other countries this year.
Ownership Stake in the NEO Blockchain
NEO tokens represent an ownership stake in the entire platform. Each holder of a NEO token has a small stake in the 100 million NEO coins that will be in circulation. This means that they can also vote on important decisions as it pertains to the platform.
These ownership interests will also pay the holders in the form of GAS. You can think of GAS as dividends for holding the NEO tokens. These GAS are similar to the concept in Ethereum and they are what allow the applications to pay for processing power.
This also acts as a unique incentive where holders will try to keep onto their NEO coins for a period of time in order to take part and not just flip them for a profit.
Exciting 2018 Ahead?
Given all of these advantages, one can hopefully expect to see much more adoption of NEO as the year moves on. The NEO development team are also really active and have become more engaged with the community. They are also promoting the coin in a number of other jurisdicitions.
We have also seen the price of NEO reflect this renewed optimism as it has breached the $100 level for the first time and reached all time highs.
Whether the price is likely to continue climbing in the short term is hard to tell, yet the smart contract economy is indeed looking quite promising.
Disclaimer: These are writer opinions and should not be considered investment advice.
Featured Image via Fotolia