NEO’s founders Da HongFei and Erik Zhang founded a association called OnChain. Understanding OnChain is vicious to bargain NEO. They’re not the same company, but their interests align and they have a partnership together. OnChain’s system, famous as DNA (Decentralized Network Architecture) aims to work with Chinese businesses and government. NEO acts as the substructure of DNA. If OnChain can confederate with Chinese businesses and government, that will severely coax adoption of NEO.
Ultimately, DNA develops open and private blockchains for businesses. These blockchains then couple up to NEO to join the decentralized economy. Businesses then have all the advantages of both private and open blockchains. Think of NEO as providing the open blockchains and OnChain’s DNA providing the private blockchains. Then, they can couple up and get the best of both worlds.
OnChain also has several projects and partnerships and newsworthy mentions that all minister to the DNA ecosystem:
- Established in 2014, this is not a fresh-off-the-shelf company
- First Chinese blockchain association to join Hyperledger — a partnership of projects that work towards integrating blockchain with determined businesses.
- Legal Chain — works with Microsoft China in digitizing and securing signatures around blockchain technology.
- Strategic partner of Microsoft China on mixed projects
- Worked with the Japanese Ministry of Economy, Trade and Industry
- Voted as KPMG’s tip 50 Fintech Company in China
- Partnership with Alibaba to yield an email acceptance use for Ali Cloud
- Investment from Fosun Group—China’s largest private conglomerate — to confederate OnChain opposite their businesses.
- Collaboration with Chinese informal government — using OnChain to rise open services and digital identity
OnChain’s new growth was of the ICO Ontology. Ontology uses the same design as NEO but eventually works with businesses in formulating a private, encrypted information network. Essentially, this is critical when we have information that we need securing, but we also need it to be private. This will capacitate people to pierce this information in a secure demeanour to blockchains.
References on OnChain’s roadmap
Honestly, we don’t know because NEO doesn’t publicize their partnership with OnChain more. NEO in itself is solid, charity several intensity advantages over Ethereum. But sum with OnChain, NEO truly has the intensity to exercise itself as THE intelligent economy height of the East.
The Ethereum Comparison: Ethereum’s homogeneous is the Enterprise Ethereum Alliance, an open source blockchain commencement dedicated to joining Ethereum with the business world. Their list of partnerships is clever and impressive — no warn for those informed with Ethereum. Included among their members are: BP, HP, Toyota, MasterCard, Microsoft, and Intel, among many others.
TLDR: OnChain is a association partnered with NEO. They have endless believe and many accolades in bringing blockchain to businesses. They work with companies and governments in the East. They are a outrageous member to NEO’s potential.
NEOX is NEO’s chronicle of atomic swaps (directly swapping tokens but any exchange) and cross-chain integration. Think Ark Ecosystem. This will capacitate people to barter crypto resources and covenant opposite different blockchains. It also allows intelligent contracts to correlate opposite chains.
NEOX is critical because it allows partnership between the blockchains (both private and public) combined by OnChain and by NEO’s open blockchain. As more components of the Smart Economy develop, NEOX will couple them all together.
Ethereum Comparison: Ethereum has the ability to do atomic swaps, but has only finished this once — this isn’t to put down Ethereum; NEO has never finished one. However, Ethereum will need an outward focus to accommodate vast scale cross-chain integration.
City of Zion:
City of Zion (CoZ) is an independent, open source village of developers, translators, and designers who work towards the raise of NEO. They have perceived appropriation from NEO to assistance incentivize plan development. The village has contributed intensely to NEO. They have grown the NEON wallet, combined a NEO retard scanner, translated papers for NEO, and grown the NEX height (see below). They recently perceived NEO appropriation to endowment $270,000 to 10 winners as part of their DApp competition. It is impossibly fitting to have a network of support such as CoZ.
Ethereum Comparison: There isn’t really a good comparison for this on the Ethereum network.
Nex is an arriving ICO grown by City of Zion that offers a height for the origination of remuneration solutions and decentralized exchanges on NEO. It links to NEO with NEOX.
Because of differences with NEO in the token model, comment balances, and way intelligent agreement interact — in comparison to Ethereum — NEO indispensable a resolution to be means to effectively residence decentralized exchanges. NEX offers that solution.
Ethereum Comparison: Already ERC20 tokens are easy to covenant with on decentralized exchanges.
A turnkey, all-in-one ICO association that helps blockchain companies develop: from initial thought to ICO. They recently decided to pierce from Ethereum to NEO. They have an engaging Reddit AMA on their reasons for switching.
Ethereum Comparison: TokenHub is a identical plan building on Ethereum.
NEO is now hosting a developer competition in partnership with Microsoft China with $490,000 as esteem money.
Ethereum Comparison: Ethereum is impossibly well connected with determined corporations. NEO is personification catchup.
DApps and ICOs:
The bread and butter of platforms; until now, NEO has only had one ICO (Red Pulse) and one DApp (AdEx). However, with several designed in the nearby destiny and with an ascent last month which will capacitate NEO intelligent contracts to correlate with website interfaces, we think this is only the commencement for NEO.
Ethereum Comparison: Ethereum hands down beats NEO in this area. Ethereum is the go-to height for ICOs and DApps.
We hopefully have a clever bargain of the differences in the goals of Ethereum and NEO, as well as a good overview of NEO’s network and the network’s advantages in the intelligent economy. It’s critical to know this network for NEO because NEO is more than just a open blockchain, it is a square in the incomparable picture. When NEO’s open blockchain can couple up with OnChain’s private and business oriented blockchains and eventually with all other DApps on it’s platform, it could truly turn a intelligent economy.
The biggest differences between Ethereum and NEO
Ethereum uses the same custom as Bitcoin — Proof of Work (PoW). With Proof of Work, computers on the network contest to solve mathematical formulas and win the right to endorse sell into the blockchain, and thus, secure the network. The two vital drawbacks to the PoW custom is the risk of a 51% conflict and the vast appetite expenditure compulsory for network security. For these reasons, we think that PoW will shortly be an old-fashioned system, as blockchain transitions to a new custom called Proof of Stake (PoS).
Proof of Stake works likewise to PoW solely that instead of computers validating the network and receiving rewards homogeneous to their relations computing power, PoS uses token holders. Those who reason tokens can “stake” their tokens (staking means to temporarily place the tokens in a sealed intelligent contract — until staking is over) and in exchange, endorse sell and accept rewards formed on the relations number of tokens held. In PoW, if you work 5% of the sum computing appetite of the network, you can design to get 5% of the retard rewards. In PoS, if you possess 5% of tokens, you can also design to accept 5% of retard rewards.
PoS offers a resolution to the issues plaguing PoW — mainly it takes probably no appetite to run PoS — without compromising the security. we would disagree that it indeed improves security. With Ethereum, and all other PoW protocols, the problem algorithm (how hard it is to solve the mathematical formula) contingency constantly be updated to comment for better resource hardware and more comprehensive mining groups. With PoS there is no need to do this. With Ethereum, you could feasible squeeze enough computing hardware to grasp a 51% attack; even after comprising the network, you would still have all of that hardware and could potentially use it to conflict other PoW platforms. With PoS, because you contingency seductiveness your coins, any antagonistic function results in the loss of all staked coins. So if you bought 51% of all tokens, you would immediately remove your estimable investment. In addition, the costs of purchasing 51% of the network tokens are equal for everyone. The costs of receiving 51% of resource power — due to discounts for mass resource purchases and countries with intensely inexpensive electricity — are not.
NEO uses a custom called dBFT (Delegated Byzantine Fault Tolerance) sounds like a tenure you’d see on your AP History Test. The simplest reason of Byzantine Fault Tolerance is the emanate with how to get everybody on the network to be honest and work together — because one bad apple could hurt everything. NEO’s dBFT is a alteration of the classical PoS protocol, with some poignant advantages and one primary disadvantage.
I suppose dBFT as operative identical to how the U.S. Senate works (and if that analogy made you want to just give up on Neo entirely, we understand, but reason on…keep reading). If every chairman in America — all 323.1 million—was authorised to directly attend in the bureaucratic preference creation process, it would be catastrophic. It would be brutally delayed as millions competed for the microphone, all cheering their opinion and arguing with each other. Making decisions would also be agonizingly slow. So instead, everybody in the nation gets a vote. And with this vote, they can elect their representatives, someone to pronounce for them. This system directly reflects NEO’s governance. Instead of everybody participating in the validating process — which can be impossibly tying in terms of transaction speed — those who reason NEO tokens can opinion for delegates. These representatives (called bookkeepers) say the network for everyone. Thus, NEO can run faster, more efficiently, and with quicker and more calculable decisions, and you can stay home, splash Bud Light, and watch the Patriots diversion with your resource in nap mode.
Remember too that these bookkeepers will have their digital temperament known, creation NEO much more agreeable with inhabitant regulations.
The waste with this system is a miss of decentralization. In a purest sense, instead of thousands of validators being sparse all opposite the world, governance is strong in a few dozen validators. The infancy of these nodes are now operated by the NEO team. However, as of Quarter 1, 2018, NEO will reason reduction than 2/3 and will continue to reason fewer as time progresses. Regardless, NEO will never be as decentralized as other pristine PoS platforms.
I would however disagree that Ethereum is also not as decentralized as you might think. While the PoW custom is decentralized, you can count the number of core developer’s for Ethereum on one hand. In addition, while we trust Vitalik Buterin, he does have outrageous appetite and change over the instruction of Ethereum.
Ethereum will transition to a PoS custom in the future. They already have begun the routine and the mining problem of confirming new blocks will boost exponentially until it is unfit to cave anymore and everybody contingency transition to the PoS protocol. This will occur but it is expected more than a year out.
TLDR: Ethereum uses a Proof of Work custom and will rise into Proof of Stake. NEO uses a Delegated Byzantine Fault Tolerance (dBFT) custom which is a alteration of the customary explanation of seductiveness protocol.
Because NEO doesn’t run on PoW and has a more streamlined PoS protocol, NEO can routine sell distant more quick than Ethereum. Now when we review these, there are both theoretical and practical speeds. Theoretical transaction speeds are the comprehensive limit speed mathematically probable for the network. For NEO, this number is 10,000tps (transactions/second). Ethereum can do 30tps. In practicality, because of genuine universe inconsistencies and difficulties, NEO can do 1,000tps in comparison to Ethereum’s 15tps. As protocols urge it is probable that both platforms will proceed their theoretical speed.
This is an outrageous disproportion and a vast advantage for NEO. NEO’s transaction speeds could feasible accommodate the kind of intelligent economy they’re envisioning; Ethereum’s can not. Now in sell for this speed, NEO is not as decentralized as Ethereum. In addition, it’s critical to commend that Vitalik and Ethereum are well wakeful of this limitation. Solutions such as Raiden and sharding (two fascinating technologies but distant over the range of this article) are on the roadmap for Ethereum and could drastically urge Ethereum’s transaction speed.
TLDR: Ethereum can covenant at 15tps with a limit of 30tps. NEO can covenant at 1,000tps with a limit of 10,000tps. Ethereum has skeleton and solutions to scale to tighten this gap.
Forking and scaling:
Ethereum forks to refurbish a software, just like Bitcoin. we report this here. Forks aren’t indispensably bad, but they positively can be. Look at Ethereum’s DAO flare for an example of this. After millions were stolen from an Ethereum intelligent contract, Ethereum split to reinstate the income to the original holders. Whether or not this preference was correct, it divided the village and Ethereum Classic was combined alongside Ethereum.
Forks occur because there is no finality in the accord resource of Ethereum. Multiple bondage in the blockchain can be combined at once — ultimately, both are current bondage and can continued to be mined on. Forks occur constantly but are customarily resolved when the sequence with the most resource appetite is selected as legitimate. With Ethereum, it’s always endorsed that when you place a transaction, you wait until a few blocks have been mined on tip of yours before deliberation the transaction permanent.
NEO has finality. This is because the bookkeepers must strech a 66% accord for the transaction to be placed into the blockchain. Here is an analogy to know this. Imagine a first category class. Timmy asks how much chocolate divert costs. Cynthia has no judgment of cost (she’s in first category for God’s sake) and shouts $15! A few students travel over to her in agreement. Bobby’s a chocolate divert aficionado — he knows his milk. He says $1.25. Most of the room walks over to him. He has a majority. Now presumption Cynthia’s organisation realizes their smirch and joins Bobby’s group, then the organisation reaches consensus. But if Cynthia is carrying a quite realistic day, she could keep on with her decision — a fork. It might not be the right answer, but she still has a current answer. This is how Ethereum works.
NEO works like this. Imagine the same scenario. Timmy again asks how much chocolate divert costs. First Cynthia speaks up: “$15!” A few whimper in support, but it’s clearly not 66% of the category so her thought is discarded. Next Bobby says “$1.25.” 66% of the category support his explain and thus, his thought is final. With NEO, the bookkeepers each introduce the scold state of the subsequent block. When 66% of them support the proposition, the retard is finalized.
The implications of this are huge. Finality is impossibly critical for the form of economy NEO hopes to support. The financial attention and other complicated, quick relocating markets (stock markets for example), can’t work on a system but finality. They need to know that when their information is placed into the blockchain, it is there for good. They also need the declaration that their blockchain won’t unexpected turn irrelevant because of a fork.
TLDR: Ethereum can fork; NEO can’t — this is critical for adoption by our genuine universe economy.
Decoupling of GAS and NEO
This might very well be NEO’s most inventive characteristic. The local token of Ethereum is ether. The gas indispensable to run the Ethereum network (execute contracts, control transactions, etc.) is indeed just small units of ether. There is no subdivision between sky and gas.
However, NEO decoupled itself from the token indispensable to run the network: GAS. The NEO token is like prejudiced tenure of the NEO platform. NEO token holders are entitled to opinion for bookkeepers. NEO’s use as a share in the association rather than a token is furthered by the fact that NEO is non-divisible. NEO is not meant to be transacted with — that’s because there is GAS.
GAS is used for all operations on the NEO network. Now when a association registers or changes resources on the NEO blockchain, they compensate in GAS — this GAS is then distributed to all NEO holders. Anyone can explain this GAS by just holding their NEO in a personal wallet. Such as this one: NEON
Bookkeepers are entitled to assign a transaction price (in GAS) for ubiquitous sell on the blockchain that only they (the bookkeepers) receive. However, by decoupling NEO and GAS, there is an inducement to keep transaction fees low; here’s why:
High transaction fees, which only advantage the bookkeepers, will forestall people from wanting to register their resources on the blockchain. The reduction resources registered, the reduction rewards NEO holders will get. Thus, NEO holders are incentivized to opinion in bookkeepers who will keep transaction fees low.
Bookkeepers are radically incentivized by their desire to secure the network. They use the network, advantage from it, and have income staked in NEO. Thus, it is fitting for them to secure it.
It is misleading how rewards will be divided among sky holders when Ethereum becomes Proof of Stake. However, it appears that only vast Ethereum holders will be means to seductiveness and accept rewards.
The talent 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 spend 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 pull the “claim GAS” button. This also ensures that the NEO network doesn’t need to calculate the seductiveness of NEO holders with every block, shortening trade and simplifying the devalue seductiveness formulas. The substituted bookkeepers say the network; your investment gains interest. This would not be probable but two apart tokens.
Both NEO and GAS are capped at 100 million tokens.
TLDR: Ethereum has one token: ether. NEO has two: NEO and GAS. There are outrageous advantages to carrying two tokens when using a explanation of seductiveness protocol.
Smart Contract Language
The biggest disproportion between Ethereum and NEO intelligent contracts is the coding denunciation options available. With Ethereum, contracts contingency be combined in solidity — A coding denunciation combined privately for Ethereum. NEO on the other palm supports a accumulation of different languages, including the most ordinarily known. NEO supports 5 programming languages with skeleton to support an additional 5 in the future.
There are positively advantages to crafting a sold denunciation for a sold platform. Ethereum developers designed reduction for Ethereum. However, distant fewer people know solidity. By ancillary the most common coding languages, NEO has an advantage in facilitating adoption. Most programmers today would have to learn reduction before operative with Ethereum since with NEO, their believe is already applicable. It’s also probable that existent business platforms could be placed onto the NEO blockchain but much modification.
TLDR (seriously? It’s like two paragraphs): Ethereum has one coding language: Solidity. NEO supports many different coding languages.
Smart Contract Execution
Smart contracts use what are called virtual machines (VM). Essentially, in layman’s terms, practical machines are machines that govern intelligent contracts and run inside the computers of miners or other validators. The VM is the sourroundings that the intelligent agreement runs in. Thus, if we want to know how fit and effective intelligent contracts can be, we need to investigate the VM.
NEO’s VM optimizes intelligent agreement formula before executing the contract. What this means is that it takes the formula and reorganizes it to make it more efficient. Imagine your mom gives you a grocery list. If it’s anything like my mom’s lists — and she will probably intent to this — the equipment have no classification and we am constantly ping-ponging back and onward opposite the grocery store. But by organizing all the equipment into categories that we can then collect up together at the same part of the store (dairy, canned goods, cereals), my pursuit becomes much quicker and easier. NEO does this; Ethereum does not. Now while this creates things much easier in the long run, in the initial proviso it takes a bit longer to classify the list. NEO’s agreement execution takes somewhat longer than Ethereum’s, but is much more fit in the long run.
Ethereum skeleton to hurl out this mechanism, but there is no timeline for it. Ultimately, this allows NEO to govern and run formidable intelligent contracts faster and more well than Ethereum.
TLDR: NEO has a more fit and faster way of executing intelligent contracts than Ethereum.
Additional Important Differences
- NEO is theoretically quantum resource resistant, Ethereum is not — When quantum computers rise enough, blockchains could be vulnerable. NEO has theoretically designed their blockchain to comment for this. Ethereum does not have that capability.
- sk-Snarks: Ethereum’s new remoteness tool. sk-Snarks is the remoteness custom of ZCash. While there are distant smarter people who can explain the record distant more cleverly than me, radically sk-Snarks is critical when we want to have information or contracts whose essence are private or confidential. We need to say the remoteness of the data, but at the same time, infer we have tenure of it. sk-Snarks allows users to infer they have tenure but indeed giving up the private data. NEO has no such capabilities. However, NEO’s partnership with OnChain’s Ontology offers NEO a remoteness resolution for businesses.