Have you heard of NEO, the comparatively new China-based cryptocurrency and open-source platform that has caught the crypto world by storm? That’s what we thought! The coin has received so much publicity that it already got the name “the Ethereum of China”.
Anyway, before we tell you more about this digital coin and where to get it from, a quick crash course on purchasing cryptocurrencies in general. Traders buy them on online crypto exchange platforms that either exchange both fiat and cryptos or are limited to crypto-to-crypto exchanges exclusively.
You’ll see in a moment why this is especially important when it comes to buying NEO.
Where to Buy NEO?
Unfortunately, even though NEO is becoming an increasingly attractive investment in the crypto market, it’s still not listed by the majority of fiat to crypto exchanges. A potential challenge might be the fact that it was originally developed and created for the Chinese market.
However, things are definitely going to change as the company’s presence is already felt on the global market. At the moment, the best place to buy NEO as a US citizen would be Binance. Although Binance doesn’t offer the option to purchase NEO with US dollars directly, our advice is to exchange your dollars for Bitcoin or Ethereum first and then trade your BTC or ETH for NEO.
We recommend choosing Binance as one of the most reliable and secure platforms for crypto trading. Binance allocates 10% of all its trading fees to the Secure Asset Fund for Users (SAFU) it pioneered, and uses these funds in case of security breaches to cover up the losses. The platform charges a low fixed fee of 0.1% per trade and you can even get a discount if you decide to pay with the native token BNB.
What Is NEO?
It’s been three years since China enacted a ban on initial coin offerings (ICOs) which is how companies, especially start-ups, raise funds to develop their cryptocurrency projects further. This has been a heavy blow both on domestic developers but also foreign ones, as they used to benefit from the support of one of the largest markets in the world, i.e. the Chinese.
China doesn’t condemn the blockchain technology as such, on the contrary, the country even plans to launch its own digital coin. However, the government sees the whole Bitcoin trading thing as unnecessary and dangerous. Their coin, the digital yuan, won’t allow price speculation.
Therefore, it comes as a big surprise to learn that NEO is actually a China-based open-source platform that supports the creation of digital assets and smart contracts. Their stellar team of crypto experts saw early on that blockchain could have far greater implications than its creators might have been aware of. To prove this, NEO tries to show how our economy could be easily transformed into a “smart economy”.
Who Created NEO?
NEO was founded under the name AntShares in 2014, by two exceptional entrepreneurs and developers, Da Hongfei and Erik Zhang. They published the platform’s whitepaper containing all the design details and open-source NEO on GitHub in the following year. Two years later, they rebranded AntShares into NEO, a name that reflects the values of the Greek prefix “neo” (νεο-), i.e. something “new”, “modern”, and “young”.
In the Genesis Block, the NEO team mined 100 million NEO tokens. Out of these, 50 million tokens were proportionally distributed to early investors that participated in the NEO crowdfunding. The other half was locked in a smart contract and managed by the Neo Council. It will be used to support the growth and development of NEO’s ecosystem, and it has been decided that no more than 15 million NEO tokens should be spent on an annual level.
On the network, the NEO coins are used to maintain and govern the blockchain, as well as to manage and vote on the network. But there’s also another currency that NEO supports and that’s GAS. Users owning NEO generate GAS and spend them on transaction fees. They also need GAS to utilize the functions provided by NEO (e.g. smart contracts). This is very similar to the purpose of Ether, Ethereum’s native currency.
What Are Their Future Goals?
Under the term “smart economy”, NEO understands an economy that welcomes and leverages the use of digital currencies coupled with a reliable digital identity relying on smart contracts and decentralized applications.
One of NEO’s major innovations is that they use the blockchain technology to digitalize physical assets. This way, they become decentralized, trustworthy, traceable, and transparent. Once you verify your digital identity, you’re able to register your asset and get protection for it. You can trade and circulate a number of these assets.
Individuals and companies that have been registered with a valid digital identity are able to enter into smart contracts with other verified parties. Instead of hiring an intermediary to solve trust-related issues, a programmable computer code that contains all the rules and conditions the parties have agreed on makes sure the contract gets executed only when all the specifications have been met.
Who Is it For?
By now some of you might be asking, is it worth investing in NEO’s native currency? How does it fare as a store of value?
To be honest, much work remains to be done if NEO wants to compete with the most popular digital coin, Bitcoin, whose worth is over $8,800 at the moment. NEO, for its part, is worth only $11.21 which is still impressive for a relatively new cryptocurrency. Even if most traders believe that NEO is not the best long-term investment, it could be for those that want to use the applications on NEO’s network.
If you’re an ambitious developer who believes in the potential of blockchain technology and sees the future of the financial and trade industry in the blockchain-based smart contracts and DApps, then NEO is the right place to invest your time and money in.
The advantage of NEO over other platforms that offer their users to create smart contracts is in making them even smarter and faster. One of the biggest problems that popular blockchains are facing is how to save up on space with so many incoming transactions and other applications that are constantly stored on the ledger and remain there forever. NEO is introducing a new way of dividing the data and storing it on multiple decentralized servers, a process known as “sharding”.
Pros and Cons of NEO
Ethereum was the first cryptocurrency platform to introduce the concept of smart contracts, even though the idea itself goes back to Nick Szabo and the 1990s. NEO wanted to improve on some of the flaws it saw in Ethereum’s system and created its own independent smart contract system called NeoContract.
On top of that, NEO has been using the proof of stake mining and verification method for a few years now. The PoS method consumes less energy and computing power which is why other major blockchains like Ethereum and Bitcoin are trying to work out a strategy and replace the proof of work method they’re otherwise using.
NEO adheres to all the crypto regulations set by the Chinese government. This makes it reliable and secure but also uncompromising and thorough at the same time. Even node operators have to verify their identity before they’re allowed to work on the platform. Also, another potential problem could be having to choose one market to focus on under such regulatory pressure.