NEO is a blockchain-powered platform that also doubles up as a cryptocurrency. Founded in 2014 by Da HongFei and Erik Zhang, the decentralized application platform seeks to enhance the development of digital assets and smart contracts.
NEO came into being as China’s response to Ethereum. Its developers sought to provide the market a cryptocurrency that regulators in China would agree to at a time when Chinese authorities were against the new spectacle.
How NEO Works
Since rebranding from Antshares in 2017, NEO has sought to enable a smart economy by leveraging blockchain technology and smart contracts in the issuance and management of digital assets. By automating the management of digital assets, the decentralized platform seeks to build a distributed network based on a smart economy system.
The smart economy proposed by NEO is based on three layers.
Digital Assets: On this front, NEO seeks to make it easier for users to register and trade multiple types of assets through a digital identity protected by an immutable blockchain. The digital assets can come in the form of global assets recorded in the system space and identified by all smart contracts and clients and contract assets recorded in a private storage area.
Digital identity: denotes the identification of individual, organizations, and other entities digitally
Smart Contracts: proposes the NeoContract smart contract system that is based on multiple languages.
NEO is tailored to becoming a digital decentralized and distributed platform for non-digital assets through the use of smart contracts. Its primary goal is to become a digital alternative for non-digital assets transfer. For instance, it could end up enabling the payment of rent using smart contracts that trigger once a month automatically.
While NEO operates as a blockchain platform for facilitating the development of digital assets and smart contracts, it uses two native tokens NEO and GAS. Both tokens serve a specific role in the decentralized platform.
NEO tokens act as the native token powering the NEO blockchain. In this case, they represent the ownership of the NEO blockchain. They are often used to create blocks and manage the network
GAS tokens, on the other hand, give users the right to use the NEO blockchain the same way Ether does to the Etherium network.
Unlike other cryptocurrencies, NEO crypto cannot be mined. 100 million NEO tokens were launched at inceptions, meaning the total supply is capped at 100 million. Currently, the supply in the market stands at about 65 million tokens.
What Affects NEO Price
NEO price has struggled to bounce back to its record highs of $200 recorded at the peak of the crypto boom in 2018.
NEO is billed as the Chinese flagship cryptocurrencies; likewise, any regulatory pressure that authorities in the communist nation pass pertaining to crypto goes a long way in influencing the NEO price.
NEO being more than just a digital currency also sees its price influenced immensely by the underlying technology. How effective the blockchain platform is at enabling smart contracts and rivaling Etherium goes a long way in influencing trader’s sentiments and price.
As with other cryptocurrencies, NEO price is influenced by media hype when it comes to mainstream adoption. Increased adoption, especially by institutions, goes a long way in driving prices higher.