A deeper look into NEO cryptocurrency
NEO is a cryptocurrency that is part of the NEO network’s platform. NEO network is a blockchain platform that makes it possible for users to build ‘DApps’ or decentralized applications. These are software, which can be run on a large number of computers. The main goal of this network is to bring blockchain technology closer to the public by creating a platform where assets can be digitally exchanged.
Da Hongfei and Erik Zhang found the NEO network in 2014, and at first, it was named Antshares. The network was rebranded as NEO in 2017. The Shanghai-based network took the name from a Greek word which translates to ‘new’ and this was taken well with the network’s intention to promote the character of serving as a bridge for the physical world into a digital realm.
Two distinct cryptocurrency tokens are used by this platform: NEO and NeoGas (GAS). NEO is the base asset, which is the tool that is used in order to represent ‘shares’ in the NEO market. The coin uses GAS tokens to pay dividends and it also gives voting rights to holders. The transaction fees of the network are paid using these alternative tokens, and these tokens are also used for creating smart contracts, constructing the blockchain, and also for making DApps.
A smart contract ecosystem, sometimes called ‘smart economy’ is used by the network to work through. Two or more parties need to enter into a NeoContract in order for a transaction to be completed using NEO. A NeoContract is a smart contract that is used by the network (an agreement written in code that has legal status).
What Are NEO’s Main Advantages?
When referring to its advantages, among many others, 4 of them stand out that make this cryptocurrency very innovative and a strong competitor worth investing in:
- Indivisible Units
- Creating GAS
- Smart Contracts
Let’s break down these advantages one by one below:
The cryptocurrency shares and prices are some of the elements that worry many people. Contrary to Bitcoin as an example, which is divided, NEO will always remain one share. As a matter of fact, this may prove to be an issue if the value drastically increases.
Nevertheless, exchanges were able to find a solution to this indivisible obstacle. As long as you hold fractions of NEO in your exchange wallet, you are allowed to trade them. However, if they are transferred to your NEO wallet, the exchange will retain the fractions and they will not be transferred to your private wallet.
So, this means that it is not technically possible for you to own 2.26 NEO. Instead of this, you would have either 2 or 3 NEO and not a value in between. So your exchange makes it possible for you to hold 2.26 NEO without having an issue. But if you would transfer the 2.26 coins you own to your NEO wallet, you would have only 2 and the remaining 0.26 would be kept on the exchange.
Smart contracts are becoming more and more appealing to cryptocurrency founders. Simply explaining, smart contracts can be understood as the digital version of using a third party to hold money in an escrow. The process of transferring the capital between wallets takes place after the contract is executed. The transfer is then automatically verified and witnessed by blockchain regulators.
One of the biggest benefits of cryptocurrency is the dual-tier system. Even though some exchanges support GAS, NEO will be purchased by the majority of users. The advantage can be experienced when NEO is transferred to your compatible wallet.
You naturally start creating GAS when you hold NEO, as while the Blockchain develops, blocks are constantly generated. With the generation of a new block, 8 GAS is distributed for all 100 million NEO.
This is vastly different from the algorithms and the currency mining that you see on other altcoins. There isn’t the same direct link of value between NEO’s value and GAS. Whereas on the other hand, the value of bitcoin that you mine is the same exact value as the bitcoin you bought.
ICOs and dividends are the two main elements with which cryptocurrency news is primarily concerned today. Nevertheless, it seems that profit calculators don’t concern the creators of this cryptocurrency that much and they rather focus on providing their users with an effective product. The crypto-world widely holds this opinion to be true.
Also, you are able to make a profit by just holding coins, as NEO is a proof of stake (POS) cryptocurrency.
Should I Buy or Trade NEO?
There are two positions you can take on the value of the NEO token: you can buy it, or trade on movements of its price. However, keep in mind that you need to create a trading plan first before you take a position on NEO. This is of crucial importance, as it will help you understand the platform better and also give purpose and direction to your time on the markets. Your plan should be unique to you and you should carefully assess the steps you make.
- NEO is a cryptocurrency that is part of the NEO network’s platform.
- NEO network is a blockchain platform that makes it possible for users to build ‘DApps’ or decentralized applications.
- The main goal of this network is to bring blockchain technology closer to the public by creating a platform where assets can be digitally exchanged.
- Da Hongfei and Erik Zhang found the NEO network in 2014, and at first, it was named Antshares.
- Two distinct cryptocurrency tokens are used by this platform: NEO and NeoGas (GAS).
- The coin uses GAS tokens to pay dividends and it also gives voting rights to holders. The transaction fees of the network are paid using these alternative tokens.
- A smart contract ecosystem, sometimes called ‘smart economy’ is used by the network to work through.