What is NEO? — The Simple and Non-Techy Guide
By the end of this article, you would have known all there is to know about the NEO.
NEO Token was one of the cryptocurrencies that did exceptionally well in 2017.
It had its investors smiling with a whopping 21,000% return on investment(ROI).
NEO blockchain is the only blockchain that is comparable to that of Ethereum (if not better). Hence, it’s being referred to as the Chinese Ethereum or Ethereum Killer.
There are lots of well-written articles about NEO online but, in this post, I left out all the techy details and presented NEO to you in such a way that even a 10-year old can understand.
Okay… all set to learn a new thing today? So am I!
Just sit back, relax, and have yourself a wonderful reading experience.
After shedding the ‘techy-parts’, I have arranged this post under the listed subtopics:
- NEO Basics
- NEO Currencies/Tokens
- Explaining NEO’s Smart Economy
- What Are The Best Wallets for Storing NEO and GAS?
- Top Exchanges to Buy/Sell NEO and GAS
- NEO vs ETH
- Is NEO Still Worth Investing In?
The details of each subtopic can be viewed by clicking on it.
NEO is an open-source blockchain decentralized application platform.
Remembering my ‘non-techy’ promise, I will further explain the above statement so we will all flow together.
It being an ‘open-source blockchain‘ means that it is a‘ ledger that can be accessed by all‘ and ‘decentralized‘ meaning that ‘it is not governed by a central authority.‘
So, in simple terms, NEO is an application platform that is not governed by any central authority and also has an open ledger(account book) that anyone can access.
And as such, all rules and policies are transparent and not in anyone’s favour.
The rebranding was to renew its professional image, and it took place in June 2017 at the Microsoft headquarters in Beijing.
NEO was created for the purpose of creating what is called a “Smart Economy.”
This is a way of merging the traditional economy with the digital economy. To achieve this, 3 things have to come together: Digital Assets + Digital Identity + Smart Contract.
Smart Contracts are contracts that are designed to execute themselves (without the involvement of a third party) when the pre-set conditions are met.
With this innovative idea, NEO became China’s first open-source blockchain technology.
NEO processes millions of transactions daily via its decentralized ledger, causing middlemen to be out of jobs.
NEO blockchain, like the Ethereum blockchain, has its own currencies called NEO and GAS.
I will be discussing the currencies in the next phase.
The 2 currencies of the NEO platform include:
- NEO token
- GAS token
1. NEO Token
NEO token was formerly known as Antshares and has a total supply of 100 million tokens.
If you own a NEO token, you can participate in Block creation, network management, changes, and other requirements as regards consensus in the NEO blockchain.
You will also earn GAS as a reward for holding the NEO token.
However, you can only receive gas if you are holding NEO in the official wallet. You cannot claim GAS when holding it in Exchanges.
Unlike other cryptocurrencies, NEO is non-divisible, the smallest unit is 1.
Another thing to take note of is that NEO tokens are not mined. The 100 million tokens were created at the launch of the NEO blockchain.
Out of these 100 million tokens, 50 million of them was distributed through the NEO ICO. Thus, they are already in circulation.
The other 50 million NEO token is to be used for NEO development as follows:
- 10 million NEO (10% total) go to NEO developers and Council members
- 10 million NEO (10% total) as incentives for developers in the NEO ecosystem
- 15 million NEO (15% total) invested in other auxiliary Blockchain projects used by NEO
- 15 million NEO (15% total) earmarked for “contingencies”
2. GAS Token
The GAS token was formerly known as Antcoins(ANC).
GAS is the fuel that drives the Smart Contracts. Just like the NEO token, the GAS token has a limit of 100 million GAS token.
However, unlike NEO, GAS is not all mined. The Block generates 8 GAS token every 15 to 20 seconds when it is created.
The number of GAS generated per block is reduced by 1 each consecutive year such that in 22 years all 100 million GAS tokens would have been generated.
Also, unlike NEO, GAS is divisible into fractions. The smallest unit of GAS is 0.00000001 i.e. 1/10⁸.
But…I thought there was a mention of ‘Smart Economy’ somewhere? How does that work?
And I discussed that right below! Just scroll down to Phase 3.
Explaining NEO’s Smart Economy
Again, in the ‘non-techy’ spirit, I will be drifting a lil’ to explain some concepts that will help you understand the ”smartness’ of NEO’s economy.
In the GAS protocol, GAS is mined automatically via a set algorithm and then redistributed to all NEO holders.
But some holders of NEO have not the inkling of an idea of how the distribution is done and who Nodekeepers are.
In the NEO blockchain, we have Nodekeepers(NKs) or Bookkeepers as formerly called. NKs are the validators of the NEO blockchain transaction.
I will explain how the NKs are gotten using the diagram below.
The NKs(Delegates) are selected by the NEO holders and from the selected Delegates, a Delegate Leader is randomly picked (who adds the new block confirmed by all NKs).
These NKs(delegate leader + delegates) have the function of validating blockchain transactions and setting transaction fees. The transaction fees are paid in GAS and they are redistributed back to the NKs.
But hold up:
(a). If the NKs get to set the transaction fees, can’t they just increase the fees in order to gain more?
(b). And you just said that the GAS from transaction fees goes to the NKs, from whence cometh the ones NEO holders gain?
To answer the first question(a), the NKs will be chasing away investors from the NEO blockchain if the fees are high. So the transaction fees are kept at the barest minimum to attract companies to invest in NEO. Besides, NEO holders can vote out any NK that increases the fees.
But won’t that be a case of ‘monkey dey work, baboon dey chop’ on the part of the NKs since they will barely make anything from the transaction fees?
I will revert back to this question after providing an answer to the other question.
To answer the (b) question above, the GAS distributed to the NEO holders cometh from the GAS spent by companies and decentralized applications(dApps) on smart contracts registration and validation.
So the more companies that use the NEO blockchain, the more GAS dividends will be redistributed to the holders of NEO.
Now back to the question in bold: The NKs cannot be working in vain; they have to get something for their troubles. And if you’ve not figured it out already, the NKs are persons who own/hodl a huge amount of NEO.
Since they will be earning passive income (from the GAS redistributed back to NEO holders), they just go ahead to promote the NEO blockchain even though they might earn close to nothing from transaction fees.
So, NEO’s concept is unique in the sense that everyone works for a common goal: The growth of its Blockchain.
An entirely Smart Economy indeed!
I will now discuss the wallets where you can store your tokens safely.
See ya in the next phase!
What Are The Best Wallets for Storing NEO and GAS?
NEO and GAS token are stored in crypto wallets that come in different categories. Most dedicated NEO wallet allows you to claim GAS while holding NEO but some do not especially wallets offered by exchanges.
The best wallets include:
- Hardware wallets
- Desktop/ Mobile wallets
- Web wallets
- Exchanges wallets
- Paper wallets
- Bitfi: This ‘unhackable’ wallet has the capacity to store all cryptocurrencies and tokens. Bitfi Knox wallets cost $120.
- Ledger: Hardware wallets are the most secure place to store your NEO tokens. In Ledger wallets(Nano S and Nano X), you can store your NEO and other cryptos offline. It costs $59 — $119.
- Atomic: Atomic wallet that supports 300+ cryptocurrency assets. It uses Atomic Swap technology for free exchange between cryptocurrencies. It is available for Windows, Mac OS, Linux, and Android.
- Exodus: This is a software NEO wallet with a beautifully designed user interface. In addition to NEO, Exodus supports more than 100+ crypto assets. Available for Windows, macOS, iOS, and Android.
- NEO GUI: The official wallet NEO Desktop Wallet is a GUI desktop wallet, but it is only available for windows. This is a full node wallet which means that you will download the complete NEO blockchain to your machine, which could take a while.
- NEON Wallet: The NEON wallet has all the necessary features, as it can hold NEO and GAS while allowing users to send and receive them. It is available for Windows, Mac, and Linux. The wallet allows users to claim GAS if they’re holding NEO.
- Coinomi: Coinomi is a mobile wallet available on Android and recently on desktop and iOS. It supports NEO and 1000+ cryptocurrencies and tokens.
- NEO Tracker Wallet: The NEO Tracker wallet is developed by NEO Tracker. It is an open-source web wallet, offering both ease and functionality. Users can send, receive and store both NEO and GAS. It also allows its users to claim GAS if they’re holding NEO.
These are cryptocurrencies exchange where you can store NEO.
You can exchange other cryptos for NEO on these platforms as well as store them (although not advised).
The paper wallet is an alternative to the hardware wallet. This is because unlike the hardware wallet, you don’t buy it, you simply print it.
You can store NEO and GAS in the paper wallet but you cannot claim GAS.
You can download a paper wallet from ANSY.
And that’s it about the best wallets for this coin and the end of this phase too.
Now that you are well equipped with the knowledge of the top wallets for your NEO tokens(just like a builder first secures the land before thinking of starting up building), I will be discussing the exchanges where you can buy/sell its tokens next.
Just stay with me.
Top Exchanges to Buy/Sell NEO and GAS
The top best exchanges to buy/sell NEO and GAS in Nigeria include:
Find the details below.
Formerly Ngexchanger, Blockvila is your best choice for broker exchanges in Nigeria.
The exchange was founded in 2017 and is headquartered in Port Harcourt, Rivers State in Nigeria.
It has proven itself to be one of the best indigenous cryptocurrency exchanges.
This can be seen in its excellent customer support system, user-friendly interface, and instant funding when buying NEO and GAS.
The platform was launched in 2017 by Changpeng Zhao, a Chinese developer and now offers a lot more services apart from crypto trading.
You can buy NEO and many other cryptocurrencies on Binance.
Bittrex is a cryptocurrency exchange that is headquartered near the financial center of Zurich, in the Principality of Liechtenstein.
The platform was founded in 2014 and has its CEO as Kiran Raj.
It is a trading platform that supports NEO and 8 other cryptocurrencies.
It offers 2 types of accounts to its users: Business accounts help merchants integrate cryptocurrency into their business, while with the Personal account, you can trade 24/7 and enjoy other services from Coindirect.
It supports NEO and 39 other cryptocurrencies.
Changelly is a non-custodial instant cryptocurrency exchange, which means that users’ funds are not placed in the service.
It acts as an intermediary between crypto exchanges and users since its inception in 2015.
It supports NEO and 150+ cryptocurrencies.
In 2015, it stopped its mining activities and focused mainly on the Bitcoin sector.
Over the years, CEX.IO has included other cryptocurrencies in the exchange, including NEO and GAS.
CEX.IO announced the listing of NEO and GAS on 14th Jan 2020. You can buy/sell them for USD or purchase them instantly with your credit/debit cards. The EUR and GBP trading pairs will be added on 17th January 2020 and 21st January 2020, respectively.
There you have the best exchanges where you can buy/sell NEO and GAS.
With this phase done and dusted, the next in line is the comparison of NEO and Ethereum.
NEO vs Ethereum
The major similarity between these coins is that they both created a platform for developers to build Dapps (Decentralized Applications).
However, the major advantage NEO has over Ethereum is in the transaction speed and programming language. It can handle as much as 10,000 transactions per second compared to Ethereum’s limit of 15 transactions per second.
In terms of market capitalization, Ethereum Ether ranks number 2 on coinmarketcapp.com with a market capitalization of over $17.6 billion while NEO token is on number 17 with a $777.5+ million market capitalization value.
The rest of the differences can be seen in the table below:
Is NEO Still Worth Investing In?
As mentioned earlier, NEO had provided great ROI in the past and this, among other factors, forms part of the fundamentals that pushes a coin to success.
NEO’s Smart Economy concept is one that shows great potential to act as a revolutionizer that will redefine the way the world interacts on a financial level.
The token has the backing of the Chinese government and other companies like Alibaba and Microsoft China. And the huge size of the Chinese market, when considered, becomes a boost for the coin.
Again, it has a technical advantage over its contender, Ethereum because it uses different coding languages.
Some investors have even made predictions in support of NEO.
Well, NEO appears to be a strong coin that could go a long way on the path of success.
But then, it is still up to you to decide whether to take that investment leap or still sit back to observe.
And do ensure you follow these guidelines:
- Equip yourself with enough knowledge about NEO(you can start by reading through this post thoroughly)
- Be sure that your coins are always in your own wallet(a hardware wallet preferably) and not on the exchanges
- Keep to the ‘Investment Golden Rule’ of not investing more than you can afford to lose
Yass…All phases are now done and dusted!
And this is now the last(but the very best) part ‘cos I get to hear from you at this point.
So I want to know: Do you own this Chinese Ethereum?
Which of the exchanges did you buy from and what was your experience?
Do you think NEO’s Smart Economy will eventually digitize the world?
Or you will be needing me to throw more light on some parts of the post?
Just let me know in the comment section; I will be looking out for your comment(s).
It is said that ‘Knowledge is power and knowledge SHARED, is power multiplied’.
So just go ahead and share; the buttons are right below.
Originally published at https://www.nigeriabitcoincommunity.com on November 25, 2019.
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