NEO Coin: The Chinese Ethereum NEO Blockchain In A Nutshell

Formerly known as AntShares, NEO was launched in 2014 and changed its name in June 2017. Da Hongfei and Erik Zhan introduced NEO as a blockchain-based platform that supports its cryptocurrency. At the same time, NEO allows its users to diversify their digital assets and develop smart contracts.

What’s NEO?

NEO is the next generation smart economy platform that earned its monumental rise fairly recently. Also known as the Chinese Ethereum.

The blockchain-based platform aims to streamline the management of digital assets through automation. Users can create smart contracts that promote a distributed network-based smart economy system.

Value Model

The value proposition of NEO focuses on establishing a smart economy. The plans to achieve this involve the merging of digital assets, digital identity, and smart contracts. NEO gets written through complex computer languages, which means developers can make the value proposition possible on the blockchain-based platform.

Additionally, NEO has made it possible to convert its cryptocurrency to other coins, including Bitcoin, Ethereum, and Litecoin. The only challenge that users may face is having to convert NEO to Fiat.

Blockchain Model

To know more about the famed blockchain-based platform, here are some of its significant features that make up the NEO ecosystem and its applications:

Delegated Byzantine Fault Tolerance (DBFT) Algorithm

Instead of a conventional proof of work mechanism, the DBFT algorithm is a consensus mechanism that resists the issues with Byzantine General while maintaining consensus even though nodes that bring malicious intentions appear.

NeoX

The NeoX system will allow users to execute and operate across multiple Blockchains.

NEO Contract

NEO Contract is another mechanism used to produce smart contracts seamlessly. It promotes scalability allowing users to integrate the tool in pre-existing codebases such as C#, VB.Net, F#, Java, and Kotlin.

NeoFS

NeoFS is another feature of the NEO platform allowing users to obtain decentralized storage that resembles a peer-to-peer Dropbox.

NeoQS

NeoQS is a lattice-based cryptographic mechanism that generates problems that quantum computers cannot solve while maintaining quantum-proof.

Distribution Model

The distribution model is highly dependent on the progress over the development of the new protocol by the core team. Just like a release of a beta version of a software here, enabling more and more developers to start to test the ability of the new network is critical.

Economic Model & Commercial Applications

With a total circulation of 100 million tokens as highlighted on NEO those have two key features:

On the one hand, NEO holders can participate in the voting for the Neo Committee (made of members and consensus nodes to run the network).

On the other hand, similarly to Ethereum, the network charges for fees called GAS, which work as a disincentive to process less useful transactions on top of NEO. However, just like Ethereum 2.0 will burn GAS fees to prevent miners from acting against the interests of the network. So NEO does burn the system fees, while instead, it redistributes the network fees, as economic incentives/disincentives to make the network run.

Below an explanation of how this mechanism work:

In short, every new block 5 GAS is generated, as there are operations and storage of tokens and smart contracts. Network fees are distributed accordingly to create positive incentives. A 10% split goes to NEO holders, a 80% goes to successful voters and a 10% goes to the members of the Neo Council (composed of 21 candidates responsible for “maintaining the health and liveliness of the Neo network”).

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