What is Neo?

neo

Neo is a decentralized and open-source blockchain that allows for the creation of various blockchain-based services and products. Neo is known among the space for its fast transaction speeds and the crypto community often compares it to Ethereum due to its similar capabilities for building dApps.

Key Takeaways

  • NEO is a blockchain platform and crypto coin set to be a scalable host network of dApps.

  • The platform utilizes smart contract technology to enable the creation of digital assets and the execution of smart contracts.

  • NEO also has a unique consensus mechanism called dBFT (Delegated Byzantine Fault Tolerance) which is designed to improve the scalability and security of the network.

  • The native cryptocurrency of the NEO network is called “NEO” and it can be used to vote for network changes and to pay for transaction fees on the network.

The Neo platform offers a variety of features and dApp-building tools for developers. Additionally, it provides users with access to an oracle system, decentralized file storage, and a system for creating digital identities. These identities can tokenize and link to real-life identities, providing compliance with anti-money laundering (AML) and know-your-customer (KYC) regulations.

How does Neo work?

The blockchain utilizes two native tokens, NEO and GAS, to power its network. The former plays a crucial role in network governance since it allows users to stake NEO tokens and take part in decision making through proposals and voting on proposed changes. On the other hand, GAS is used to pay for the computational resources required to run smart contracts and dApps on the network.

The Neo ecosystem offers developers a new opportunity to take advantage of its advanced technology in order to develop and execute smart contracts, better known as NeoContracts. These NeoContracts are innovative dApps that allow users to experience real-world products and services on their own terms. What makes NeoContracts stand apart from other smart contract-based protocols like Ethereum or EOS is that Neo developers can develop their applications using widely known programming languages such as C# and Java, instead of having to learn a new one.

NeoContract allows for compatibility with multiple programming languages and appeals a broader range of developers who want to create decentralized applications or support existing ones.

Delegated Byzantine Fault Tolerant

To ensure the integrity and security of its blockchain, the currency uses a consensus algorithm called Delegated Byzantine Fault Tolerance (dBFT). This mechanism is similar to Delegated Proof of Stake (DPoS) and utilizes a real-time voting system to decide which computers running the Neo software can generate the next block on the blockchain. This allows any individual who holds the token to contribute to the operation of the network.

By staking their NEO, users can cast votes, with the number of staked tokens determining the voting power. The consensus nodes, elected through this voting process, hold the responsibility of creating new blocks. The network rewards them with transaction fees paid in GAS for their efforts.

Neo Crypto Development

NEO, originally known as Antshares, was founded in 2014 with the goal of creating a “smart economy”. In 2017, the project rebranded to Neo. Its founders, Erik Zhang and Da HongFei, organized an ICO for Antshares (ANS) in 2014, raising over 6,000 BTC. In 2016, users could exchange their ANS tokens for the new version as part of the rebranding effort.

The brand name “Neo” comes from the Greek word for “young” or “new” as inspiration. The network positions itself as an entry point to a newly improved smart economy, able to handle 10,000 tps. The latest protocol upgrade released in August 2021.

FAQ

Frequently asked questions about NEO.

Who are the founders?

Erik Zhang and Da Hongfei, the two co-founders of Neo, are the main actors that spearhead the mission of the Neo Foundation, which is to drive forward the mainstream adoption of blockchain technology. Da Hongfei recognizes that, while the internet revolutionized many aspects of our lives and proved itself an incredibly useful tool, it has flaws, the biggest of which is that everyday consumers don’t have control of their own data or information. This is where blockchain technology can help, by providing users with an immutable ledger that ensures privacy and security.

Erik Zhang has further been instrumental in the development of v3.0 by authoring the dBFT algorithm and overseeing its implementation into the network. This effort will make sure that only trustworthy participants are able to take part in the blockchain.  Through their efforts, the co-founders of the project have been able to lay a solid foundation for the further development and adoption of blockchain technology.

How does the network secure itself?

The NEO blockchain utilizes a consensus mechanism called Delegated Byzantine Fault Tolerance (dBFT) which enables the network to process a high number of transactions per second. The dBFT algorithm bases itself on the Practical Byzantine Fault Tolerance algorithm. That is to say, its craft suits the needs of the blockchain.

dBFT is similar to delegated proof-of-stake. Both mechanisms have NEO token holders voting for delegates who will process transactions. DBFT ensures the security of the network by requiring a consensus of at least two-thirds of the elected delegates for the adding of the next block. As a result, Bad actors that want to disrupt the network’s operations will find it extremely difficult.

What makes it unique?

The blockchain’s design makes it adapt and evolve over time. Continuous development efforts ensure that it can handle increased demand and stay current with advancements in technology. The project’s latest release is Neo 3.0. It enhanced network security and increased the number of transactions processed per second.

The distributed network employs a unique feature of having two native tokens – NEO and GAS. NEO’s function is an investment token and enables holders to vote on protocol changes and upgrades on the network. GAS, on the other hand, pays for the transaction fees incurred while using the network.

The project has a strong emphasis on continuous development and improvement, which includes initiatives such as EcoBoost. Launched in 2019, EcoBoost is a development fund that provides comprehensive support for high-potential projects, including funding, technical assistance, and marketing support through social media promotion.

How many coins are there in Circulation?

The blockchain has a fixed supply of 100 million coins, all generated at the time of its creation. The project distributed half of these coins to early investors. Meanwhile, the team locked the other half, with a gradual release of 15 million coins annually. This limited total supply serves as an anti-inflationary measure and may make it a potential long-term store of value.

How do I buy NEO?

Buying the coin is easily possible via the exchanges that trade the coin: Binance, KuCoin and Bitfinex. The coin’s market cap and circulating supply is what determines NEO price. The highest price paid for NEO was $196.85. 

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