Will NEO replace Ethereum?

There has been a lot of talk in the past year about Bitcoin. This has led to some people following the hype and buying cryptocurrency early this year. I've heard the stories of many jumping onto the Tron (TRX) train and buying Ripple (XRP) because they seemed like cheap coins. The problem was no one was actually researching the projects and understanding where they currently sat. Most cryptocurrencies won't be around 2-3 years from now. The ones that will be around have a larger vision of changing the way the internet & economies operate. I made this video on NEO to give a basic overview of what their blockchain does and how it could possible change the industry. If you would like to know more, below is an article a buddy of mine, Francisco Martinez, wrote that is a more in-depth review of NEO. Enjoy!

Also if you are in the blockchain space or want to know more about it, I'll be doing more videos like this on my YouTube channel "Valley Crypto" https://www.youtube.com/channel/UCLC2a_sINE2E2XsA3qiEjoA

NEO vs ETHEREUM

The cryptocurrency marketplace was unstoppable last year. After starting the year with a combined market cap of about $17.7 billion the crypto-market ended with a cumulative market value of approximately $613 billion. In valuation, this was more than the 3,300%

Annual gain from the existing crypto-tokens rather than the newly created coin offerings. According to most experts, this could be the best annual percent increase for any digital asset. As might be expected for all the virtual currencies, the cryptocoin marketplace has taken a lowly dimension in 2018. Following its markedly ascending to new market value on Jan. 7, the aggregate market value of all the virtual currencies loose about two-third of its market cap at a particular point. Evidently, a descending rate of about 27% of its value was recorded in mid-February.

In reality, most of the known cryptocurrencies have dipped in unison over the past two months. The largest digital token and most popular cryptocurrency, Bitcoin, has reportedly tumbled by about $5000 per coin and about 53% of its market value was reported for Ripple.

However, despite the downward turn of the global crypto-marketplace, NEO, developed with a strong vision to reshape the cryptosphere, was able to shrug off the movement. It experienced a strong upward rally for few hours before it finally succumbed to the overwhelming descending movement of the whole crypto-industry. A lot of experts claimed that it was as a result of the positive philosophy of the great momentum upon which NEO was built. NEO hit an all-time market value of $240 CAD in January; about six times higher than what was reported in December 2017

This article, therefore, seeks to explain why NEO is awesome and in many ways better than Ethereum.

WHY NEO IS AWESOME AND BETTER THAN ETHEREUM

There has been a continuous intellectual discussion in the cryptospace over the past few months about NEO vs. Ethereum. Irrespective of who you are; developers or investors, it is important to know and understand the fundamentals of what to invest on. Functionality is the most important basis of argument from a developer's perspective while ROI would be the cornerstone of the investors. Since the crypto-Industry has no brand loyalty yet; crypto enthusiasts will always prefer a platform or cryptocoin that performs more than its competitors.

NEO vs. Ethereum, which one does it better? Evidently, we are aware of the global competition between Alibaba and Amazon and that the former is closing in on the market cap of the latte: just like the story of WeChat in China. As might be expected, the Red Dragon land plays their unique rules themselves, follows and uses their own network and technology and care less about what is happening in the U.S.

So how does NEO fare against Ethereum? Do we even need to compare them?

NEO'S GAS VS ETHEREUM

GAS appears to be the most ingenious feature of NEO. Ether is the native token of Ethereum. The gas required to power the Ethereum network is actually a bit unit of ether. No separation occurs between gas and ether. With GAS, NEO decoupled itself from the taken required to power the network. The NEO token is similar to having partial ownership of the entire NEO platform. All NEO token holders are entitled to vote for the bookkeepers. Since NEO can't be divided, this can be further illustrated when we see the use of NEO as a share in the company rather than a token. NEO is expected to be transacted with- one of the reasons why it has GAS.

GAS is adopted to carry out all the operations on the NEO network. Hence, when a company changes or registers assets on the NEO Blockchain, the payment is made in GAS- this is then distributed to all the NEO holders. This GAS can be claimed by anyone by just holding their NEO in their personal wallet. For example. NEON.

For all the transactions on the NEO Blockchain, the bookkeepers are entitled to charge a fee in GAS for only the transaction they receive. An incentive to lower transaction fee is evident by decoupling GAS and NEO. You ask for a reason? Well, this is how:

High charge of the transaction fee will only prevent individuals from registering their assets on the NEO Blockchain. The less registered assets, the fewer rewards received by the NEO holders. Therefore, these holders would like to vote in bookkeepers who will lower the transaction fee. In simple terms, see it this way

  “Low transaction fees = more users = more assets registered = more GAS to NEO holders.” — according to Malcolm Lerider

The Bookkeepers, to be noted, are majorly incentivized by their urge to protect the network. They benefit from the network since they use the network and have their money staked in NEO. Given these benefits of GAS and when Ethereum becomes proof of stake, we are still unsure about how the rewards will be distributed among ether holders. Nevertheless, it seems only the large Ethereum holders will be able to stake and earn rewards.

The genius of the NEO token is that it allows users to passively acquire GAS in their wallet. No need to run the computer, keep the wallet open, or expand electricity. No need to “stake” your tokens — bookkeepers do this for you. You could even have your NEO in a paper wallet. GAS is collected when you physically push the “claim GAS” button. This also ensures that the NEO network doesn’t need to calculate the interest of NEO holders with every block, reducing traffic and simplifying the compound interest formulas. The delegated bookkeepers maintain the network; your investment gains interest. This would not be possible without two separate tokens.

Language 

The coding language options available is the biggest difference between NEO and Ethereum smart contracts. Ethereum has a unique coding language called solidity; this means that the smart contracts are written in only one language. On the other hand, NEO supports a range of languages including but not limited to VB.Net, Kotlin, Phyton, Java, F#, C#; with plans to support another language like C++, Javascript in the future. Certainly, there are are many advantages to developing a specific language for a specific platform. The developers opted for Solidity for Ethereum. However, solidity looks obscure, and most programmers don't even know how to use it. To facilitate and enhance its adoption, NEO makes use of the most common coding languages. 

The programmers see no difficulty working with NEO since they already know how it works; Ethereum, on the other hand, requires programmers to learn solidity as its coding language. With the range of different language options to choose from, it is likely that most developers will adopt NEO's smart contract 2.0 dApp and its capabilities, there removing the need to learn an intricate language of solidity. Ideally, it is estimated that about 90% of developers will be able to develop a smart contract without the need to learn any additional coding language.

Transaction Speed:

 Since NEO possesses a more streamlined POS protocol and doesn't run on POw, It can process transactions more quickly than Ethereum. For the sake of this comparison, we will compare the two platforms in relation to their speed of transaction. There are practical and theoretical speeds. Because of difficulties and inconsistencies in the real world, NEO can do 1,000tps against 

15tps of Ethereum in practical speeds. The theoretical speeds of transaction, on the other hand, are the maximum possible speed that is mathematically guaranteed by the network. Ethereum is pegged at 30tps in comparison to NEO 10,000tps (transactions per second). As protocols improve, NEO again promises us a better theoretical speed.

 This is a massive advantage and enormous difference for NEO. While the transaction speeds by NEO could conveniently contain the type of smart economy envisioned by NEO, Ethereum's can't.

Platform and how it operates

To update its software just like the pioneer of all cryptocurrencies, Ethereum also forks. As argued by most experts, forks are not essentially bad, but they practically can be. A perfect example of this is the Ethereum's DAO. Ethereum forked to refund the millions that were stolen from its smart contracts to the original holders. In essence, this decision divided the community as Ethereum Classic was eventually created.

The simple reason for this Ethereum's fork is the absence of consensus in Ethereum mechanism of operation. It is possible to create the multiple chains in the Blockchain at once- since they are valid, the chains will continue to be mined. Although can be solved by legitimately choosing the chain that has the most computer power, forks also frequently occur. This means that you will wait until mining of few blocks takes place on top yours before considering that your transaction is permanent when transacting with Ethereum.

Fortunately, because the bookkeepers must reach a consensus of 66% before any transaction is placed into the Blockchain; NEO boasts of a strong finality. The advantages of having a finality are numerous. Finality is very important for the kind of economy NEO envisages. The Fintech industry, stock markets, other fast-moving and complicated industries can't perform on a platform without finality.

They need to be assured that when their transaction is placed into the Blockchain, it is secured and there for good. Also, they need to know that their Blockchain won't be tampered or become irrelevance due to a fork. In simple truth, NEO can't fork but Ethereum can. NEO has an important operational feature needed in the real world economy.

NEO vs. Ethereum: Partnership/Backing Differences

While the Chinese government, by all measures, frowns against cryptocurrencies and have even gone far to ban ICOs in China, NEO, with its core aim to digitized digital assets, operates within the existing system and therefore enjoys the backing of both the national and state banks. Additionally, the Ethereum of China is supported by Alibaba, WINGS, and Microsoft and proves to be an essential feature of a cryptocoin in a country that is seemingly unfriendly to the crypto-industry. This backing and support from the giant companies mean that NEO will capitalize on the huge potentials of the Chinese market. Moreover, while making it the first open-source public blockchain project in China, it has also become one of the reasons for its popularity in the country.

NEO founders Erik Zhang and Da Hongfei have a sister company, OnChain, which has already collaborated with the Japanese Ministry of Economy, Trade, and Industry, as well as currently working with a regional government in China – no mean feat in a country so hostile to cryptocurrency.

On the other hand, Ethereum is operating independently of any government but enjoys support from the Enterprise Ethereum Alliance. This further illustrates the reason for its popularity and backing from the international audience. It is not a coincidence why it has greater success on the global stage. 

While following the fundamental dream of Satoshi Nakamoto, the Ethereum point of interest is mainly decentralization and thereby in accordance with the vision of its creator, Vitalik Buterin (known for his great interest in governance systems).

Coopetition by NEO

The logic that powers some of the consortiums of the energy industry and industrial open source is Coopetition. It is believed to be a setup or concept where a set of businesses or corporations who would otherwise be direct competitors cooperate to engage in a shared project. Many technologies and platforms can be developed from such cooperation and which could radically change the existing "how to" of the industries including but not limited to how the services are rendered while significantly increasing the total market reach. 

Adopting these great ideas, the core aim of decentralizing digital assets by NEO will start by enabling well-known communities and commercial projects to run their consensus nodes while creating an initial agglomeration of giant actors with a keen interest to guarantee the success and security of the network. This architecture, while it may appear counterintuitive, will be less centralized than the majority of the networks we see today. Through the coopetition architecture, NEO ensures that all the players are equally treated in the network by design. The power is independent of how cheap their electricity seems or how much they have.

Before being voted, all the nominees for the consensus nodes will undergo am an intense process of identification. Providing the appropriate means of identification that can legally represent the owner of the consensus nodes is one of these processes.