In February 2014, Da Hongfei and Erik Zhan have launched AntShares in China, which then was renamed to NEO in mid-2017. NEO is a digital asset and smart contract platform, very similar to Ethereum, yet more advanced in a number of ways. Let us examine the distinct characteristics of Neo and see how it compares to Ehtereum.
Ethereum’s emphasis is on the facilitation of dAPPS development, whereas the primary objective of NEO is the digitalization of real-world assets. The platform is set to automate digital asset management by using smart contracts, with the ultimate goal of building a decentralized smart economy. The three components of a NEO’s Smart Economy are digital assets, digital identity, and smart contracts. According to the official website, NEO is a “non-profit community-based blockchain project that utilizes blockchain technology and digital identity to digitize assets, to automate the management of digital assets using smart contracts, and to realize a “smart economy” with a distributed network.”
While Ethereum remains more widespread than NEO, the latter is presently considered one of the most progressive blockchain networks in the world due to its superior architecture, high efficiency, multilingualism (NEO supports Python, Java, C++, C#, Kotlin, Go, etc.), and sophisticated design.
NEO is as versatile as Ethereum and is, therefore, a great alternative to it in terms of building decentralized apps and smart contracts. No surprise that it is actually referred to as the “Ethereum of China”, although it has emerged a year earlier than the Ethereum network.
Unlike the majority of the rebel-spirited blockchain projects, NEO focuses on regulatory compliance and digital identity with the use of both the X.509 standard based on Public Key Infrastructure and the Web of Trust point-to-point certificate issuance model. The digital identities are verified using facial features, voice recognition, fingerprints, SMS, etc.
Similarly to Ethereum, there are two cryptocurrencies on the system: GAS and NEO, the first one for fueling the operation and the latter for voting rights. Both GAS and NEO tokens are limited to 100 million. NEO is non-divisible and GAS is divisible. The entire NEO supply has been already minted, whereas, GAS is still to be made in approximately the next 22 years.
In theory, NEO is capable of performing 10,000 transactions per second (as compared to 30 transactions per second of Ethereum) which naturally means lower energy consumption.
NEO employs a more advanced consensus mechanism, called Delegated Byzantine Fault Tolerance with reliance upon a modified Proof of Stake (PoS) protocol.
On Ethereum, forks happen quite frequently, as several chains are made simultaneously and the nodes are competing with each other with their computing power. The stronger ones get to build the blocks and earn rewards, which means that that, in theory, a powerful quantum computer could one day reverse the Ehtereum transactions. Forks are not possible in the NEO’s PoS, therefore NEO is a truly immutable blockchain where transactions are solid and irreversible.
Emirex supports all the major blockchains, including NEO. Come back soon to check out the next articles about the fascinating world of blockchains!
Digital Commodities Asset Exchange in the Middle East, focusing on tokenised commodities. Licensed and Regulated. Tokenisation advisory.