Glossary

NEO

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Glossary Crypto Heroes NEO Lesson

NEO is a cryptocurrency, and a blockchain platform. It was designed to deploy and support smart contracts. NEO’s native tokens are also called NEO, and are non-divisible, unlike other cryptocurrencies like Ether (ETH) and Bitcoin (BTC). Even though the token is non-divisible, it creates small tokens, ‘GAS,’ which pays for transaction fees associated with running Decentralized Applications (DApps) on the NEO blockchain.

The cryptocurrency was created by Da Hongfei, together with the CTO, Eric Zhang, in 2014. It was first launched as Antshares (ANS), with the aim of providing an Ethereum-like ecosystem for DApps to run on. It was the first cryptocurrency of its kind in China. The currency was rebranded to NEO in June 2017.

Programming languages supported

Even though the NEO protocol is written in C#, it uses a version of the Docker virtualization operating system (OS) called the Neo Virtual Machine, or NeoVM. This VM compiles code that is written in different programming languages and helps execute them in a secure environment. Developers can write NEO code in C#, Javascript, Go and Java. They do not have to learn a new programming language to create applications that run in the ecosystem.

Onchain

Da and Eric founded a blockchain consulting company at around the same time as they founded Antshares. Onchain helps private companies that are looking to develop their own distributed ledger technologies with consultancy advice. Onchain joined Hyperledger in 2016 and used the opportunity to create a product called the Distributed Networks Architecture (DNA).

In 2017, Onchain partnered with Microsoft China and FaDaDa to help research and create legal use cases of the blockchain technology.

The distribution

The maximum number of NEO tokens that will ever exist in circulation is 100,000,000. These were created in the genesis block. During the early development years, 50 million NEO were sold to early investors. Some of the tokens were also used to pay developers. The rest of the tokens were locked into a smart contract that releases 15,000,000 NEO every year. These new coins are used by the team to fund long-term development goals.

The NEO tokens also generate GAS in at a fixed rate. After 22 years, all 100,000,000 GAS will have been released into circulation.

NEO consensus

The coin relies on a 2/3 majority rule to vote. To make this possible, NEO uses a Byzantine Fault Tolerance consensus mechanism. The network can process up to 10,000 transactions per second using this voting system. The block time is 15 to 25 seconds, and users can view transactions using two primary explorers: neotracker.io and neoscan.io. Chains that use the Byzantine consensus mechanism cannot be hard forked because of the 2/3 majority rule.

Historical prices

NEO had a narrow trading margin from its days as Antshares until 2016, trading in the range of $0.0001 to $0.0008. The price jumped to $0.25 on October 27, 2016, and the market capitalization also shot up to $6.7 million. The price traded sideways until June 2017, where the price climbed from $1.9 to $8 within two weeks. In August 2017, the price reached an all-time high (then) of $47. This was followed by a gradual downward correction that formed a local low at $37, on December 10th.

The price then took a rapid upswing from December 2017 to January 28, 2018, when the price of one NEO token was $150. Since this all-time high, the price has slowly tanked to the current $7.07 as at December 3rd, 2018.

Vision

NEO is working to merge two blockchain philosophies into one – the off-chain and the on-chain transactions, in a joint-accounting model. It also seeks to merge the traditional fiat system with the decentralized blockchain system – whereby the tokens are used as property shares. In essence, the this cryptocurrency’s team seeks to bridge the gap between blockchain technology and real-world assets.

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