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What Is Neo (NEO) Token?

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by John Caroline · 6 min read
What Is Neo (NEO) Token?
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The crypto space often faces certain regulatory backlashes. However, some cryptocurrencies have proven to be a hedge over most loopholes. Neo is one of such regulatory-friendly cryptocurrencies operating a smart economic system. Here is all you need to know about Neo.

The evolution of Neo protocol and NEO token came up as a response to the Chinese government that had severally raised regulations in previous times to sour the potentials of cryptocurrencies in the country. Thus, the network was designed with a regulatory-friendly nature, which eventually made it the first blockchain project that was wholly approved by the China regulators.

Neo in its nature that differs from other cryptocurrencies is best described as a smart economic system that accommodates and features digitized payments, digitized identities, and digitized assets. More specifically, Neo blockchain operates as a distributed network for the smart economy as it allows developers free entry with options to build dApps in accordance with their choice of design.

Considering the functionality of Neo that acts more of an alternative to Ethereum (ETH), many believe it to be a newer version of the Ethereum network.

Meanwhile, since Neo has become the first blockchain project the Chinese regulators have ever accepted, it is among the few digital assets legally traded in the country. Therefore, many have tagged the cryptocurrency as the Chinese Ethereum.

History and Launch of Neo

The desire to boost the global adoption of blockchain and a foundation for the succeeding generation of the internet brought about the evolution of the Neo blockchain project.

In 2014, two blockchain experts Da Hongfei and Erik ZhanNeo founded Neo in China. The cryptocurrency was formerly named Antshares after its launch in 2014. At that time, it was recognized as the first-ever public blockchain in China. After about 3 years of operation, the developers rebranded it as NEO in mid-2017.

The innovators sought to provide an EcoBoost technology that would encourage developers to build decentralized apps and smart contracts on the Neo blockchain.

Neo’s Smart Contracts

Neo functions in a way that provides developers with the necessary facilities essential to perform smart contract operations effectively and efficiently. It allows them easy entry with no complex process. In other words, users do not need much technical knowledge or expertise to build applications and smart contracts on the network.

Neo blockchain platform accommodates a gross and diverse set of coding languages. As a result, it stretches welcoming arms to developers from across the industry.

With Neo, users can conduct trade with digitized identities without direct involvement with the activity.

Migration to N3

After a few years of Neo’s operations in the crypto industry, the team behind the project began to seek a further upgrade or Neo3. It was a new governance model that was set to bring further interoperability to the ecosystem.

The upgrade later underwent certain audit processes with developers experimenting with its potentials. The developers behind the project had to set up testnets for the project with Bitcoin (BTC), Ethereum (ETH), and Ontology (ONT).

Interestingly, the migration to Neo3 targeted to empower the platform to gain more cross-chain capabilities with better network security which tends to allow the processing of a greater number of transactions per second.

Neo Token vs Bitcoin

Although Neo seems to be a competitor to Bitcoin, there are several differences between the features of both cryptocurrencies.

To begin with, the Chinese smart contract system Neo adopts makes the asset a centralized one. Meanwhile, Bitcoin is basically a decentralized digital currency.

Furthermore, Neo and Bitcoin came at different periods with different forms of mining processes. There is no mining for Neo, while Bitcoin demands an ASIC mining method.

Neo Token vs Ethereum

As said earlier, Neo is a rival to Ethereum as it follows the Ethereum design which allows it to accommodate a wide range of diverse digital assets. It is also providing extreme support for blockchain assets, digital identity, and smart contracts.

Neo functions similarly with Ethereum with just a few differences. The major one is that Ethereum is a decentralized network, while Bro is centralized.

Another difference between both networks is that you can divide the Ethereum cryptocurrency into units. In contrast, NEO is indivisible.

However, both networks possess almost the same mode of operations.

NEO and NeoGAS Tokens

Neo provides a flexible ecosystem for users following the two tokens it adopts on its network. In particular, the platform uses NEO and GAS tokens for its operations. The former is the blockchain’s native cryptocurrency while the latter is the utility token for the network.

The Neo token plays a major role in the governance of the protocol. It tends to be indivisible as each of the NEO tokens signifies a share of the Neo blockchain.

GAS tokens on the other hand are useful for carrying out transactions on the platform.

Unlike NEO, you can trade GAS for other cryptocurrencies such as Bitcoin, Ethereum, and the likes. In addition, you can directly convert GAS into NEO. Users of the platform receive rewards in GAS tokens as the network automates the generation of GAS tokens after the confirmation of a block. This represents the mining method for GAS tokens.

This is a distinguishing factor for NEO tokens as you can not mine or generate NEO. The amount of NEO in circulation is from the supply since the launch of the platform. Thus, NEO has had a total supply of 100,000,000 tokens since the platform’s launch. There are 70,538,831 NEO tokens in circulation as of mid-2021.

The token is available for trade at major cryptocurrency exchanges like Binance, eToro, Bitfinex, and many others.

Operations within the Neo ecosystem rely both on the NEO and GAS token.

Neo’s Advantages Over Other Blockchains

The Neo blockchain possesses more unique features, unlike many other blockchain networks. Neo provides an avenue for full support projects with high potentials.

More precisely, its mode of functionality offers grants, infrastructural and technical support, and promotions for developers to build their dApps and execute smart contracts.

Its feature of continuous development is comparable to none. This way, it has a positive predictable futureproof and an assurance that it will be able to adjust with sudden increases in demand, which is a notable benefit over other blockchains.

Conclusion

Neo platform and NEO token have received a wide adoption from many experts. Besides, it has become the choice of many enthusiasts due to its unique features.

Its vulnerability to further advancements like the Neo3 upgrade makes it more outstanding among other networks. As such, it is sensible to forecast a more successful future for the network.

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FAQ

What is Neo?

Neo is a smart economic system that accommodates and features digitized payments, digitized identities, and digitized assets. It is a distributed network for the smart economy.

What problems does Neo solve?

Neo solves the problem of inflexibility as it adopts a model that allows it to adjust its market approaches according to the users’ needs.

Who are the founders of Neo?

Two blockchain experts named Da Hongfei and Erik Zhan are the founders of Neo.

How does Neo work?

Neo’s functionality provides full support for decentralized applications of all types, thereby accommodating a wide range of digital assets regardless of their diverse natures.

Is Neo better than Ethereum?

Neo functions so similarly with the Ethereum network. Yet, it possesses some features that give it the tendency of performing better than Ethereum in some cases.

What is the difference between NEO and NeoGAS tokens?

A notable difference between NEO and GAS tokens is that the former is the platform’s native cryptocurrency used basically for the platform’s governance. The latter is the platform’s utility token, basically used to conduct transactions on the platform.

What are the advantages of Neo?

Neo features a process of continuous development which makes it vulnerable to further advancements and developments. It also provides grants, infrastructural and technical support for developers to build their desired Dapps and execute smart contracts.

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