NEO cryptocurrency

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NEO cryptocurrency
NEO cryptocurrency

NEO – cryptocurrency from China, launched in 2014 under the Antshares name. NEO supports smart contracts that can be written in C #, C ++, Java, and Python programming languages; uses the proof-of-stake method, eliminating electricity costs for mining.

According to the creators, the NEO blockchain can process up to 10,000 transactions per second, which is hundreds of times faster than Ethereum and thousands faster than Bitcoin.

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Antshares is the first Chinese company working with the blockchain, which opened the code of its platform completely, creating an opportunity for independent experts to check and copy the developments.

The founder of the company is Da HongFei, known as the creator and owner of OnChain (in top 50 financial companies of China). OnChain cooperates with major Chinese corporations, including Alibaba. Because of OnChain’s connection with the state authorities of China and Japan, NEO is mistakenly attributed to cooperation with the authorities.

The NEO platform has an additional cryptocurrency – Gas, which is used to pay commission on the transactions. Gas can be purchased separately on different major exchanges or received as dividends for owning NEO in the official platform wallet.

A significant difference between NEO and other cryptocurrency is the proof-of-stake method (proof of the share of ownership). In this method of protection, the formation of a new block in the blockchain can bring a reward to any account that has cryptocurrency on its balance. That means, having 1% of all NEO cryptocurrency in your wallet, you would have a probability of receiving a reward of 1% for a new block. To do this, you do not need to create farms for mining and the hashing power does not matter. The advantage of this method is the absence of electricity consumption for mining, and the disadvantage is motivation to keep the currency in the wallet and the problems in the initial distribution of coins.

Speaking about the distribution of NEO coins, it should be noted that there are only 100 million coins created, and by early 2018 there are 65 million coins in circulation. The first part of 50 million was sold during the process of crowdfunding the Antshares project. The second part of 50 million was locked until October 16, 2017. The second part was distributed among the developers of the cryptocurrency and is intended for the development of the platform, it is divided into the following parts:

  • 10 million went to the developers and consultants of the project;
  • 10 million is designed to motivate NEO developers and related projects;
  • 15 million should be used to invest in other projects related to the NEO platform;
  • 15 million is saved for additional use.

NEO-linked GAS tokens have a maximum volume of 100 million and at the beginning of 2017, there is 9,137,582 GAS in circulation. These tokens are formed with the advent of a new block in the NEO blockchain. Each block generates 8 GAS. The block is formed every 15-20 seconds, so in a year there is 2 million GAS generated. It should be noted that the platform includes a reduction in the generation of GAS by 1 token per year. This reduction will occur until the moment when the formation of a new unit will generate 1 GAS. Formation of the maximum number of GAS will take 22 years since the launch of the platform.

Protection from quantum computers

In the cryptocurrency world, the probability of an attack is considered with usage a quantum computer. It is believed that with the growth of computing power will have the opportunity to commit an attack on the Bitcoin blockchain system, at which the encryption algorithm will be deciphered. The possible preparation of such an attack became known since the information leakage from the US National Security Agency, which allocated $ 79.7 million for the project on the development of quantum computing.

Similarities with Ethereum

  • Like ERC-20 tokens from Ethereum, NEP 5 from NEO can be used to organize ICOs of new projects. Unfortunately for the platform, the Chinese authorities have banned the ICO, so the development of NEO in this direction is limited.
  • Like Ethereum, NEO is trying to create platforms for creating decentralized applications (DApp), but competing with Ethereum on its own “field” is quite problematic. The current work plan (roadmap) for Ethereum is more focused on developers and users, while NEO is working on a “smart economy”. Thus, Ethereum seeks to respond to current requests, and NEO is focused on a possible future.

The differences between NEO and Ethereum

  • Ethereum uses the Proof-of-Work method, which involves the use of computing powers of users, that is, mining. NEO uses Proof-of-Stake, in which the award is distributed not for mining, but for the possession of currency within its purse.
  • Ethereum supports the programming language Solidity, while in NEO there are popular C #, C ++, Java and Python. Thus, the NEO platform may be more attractive for developers.

Problems and criticism

Criticism of NEO is connected with 100% pre-mining of cryptocurrency. This problem is directly related to the PoS protection method, while PoW allows you to distribute the reward gradually among those who connect to the cryptocurrency mining.

The downside of this solution is the presence of a large volume of NEO (and GAS) tokens in the hands of platform developers. At any time, these tokens can enter the market and crash the exchange rates of the cryptocurrency.

Wallets

Official NEO wallet is available only for Windows users. Mac OS users are forced to use alternative solutions, including NEON Wallet, NEO Tracker, NEOWallet from third-party developers.

Mobile wallet for Android is mentioned on the official website of the platform, but it was developed by a third-party company PeterLinX.

The paper wallet is offered by the third-party project Ansy. Users of the paper wallet do not receive GAS tokens.

There are a number of wallets for the NEO cryptocurrency, which are created by scammers. Such a fraudulent purse is called myneowallet.io and neopaperwallet.org

Conclusion

  • NEO is a promising cryptocurrency, behind which there is a real company with good development;
  • The NEO platform has prospects comparable to that of Ethereum;
  • NEO cryptocurrency can bring dividends in the form of GAS.