Back in 2009, Satoshi Nakamoto likely did not foresee that his crypto baby would change our world. Instead, it was implemented to create a decentralized crypto currency that would be free from centralized regulatory control.
Blockchain technology has since gone through transformation to encompass different sector including dating, finance, real estate, and beyond. Ethereum has gone farther to support smart contracts. It provides a platform to allow developers to build smart contracts that are publicly audible and self-executing based on controlled conditions.
There has been an emergence of new assets that are powered by blockchain technology. These include gold-backed tokens and derivatives, ETF tokens, and others. In sum, there is nearly no limit to what blockchain technologies can support.
Currently, public blockchains have a total market capitalization of over $148 billion, and this excludes the multitude of private blockchain deployments and pending implementations.
The World Economic Forum predicts that 10 percent of the world’s Gross Domestic Product likely will be stored with blockchain technology within 10 years — representing around $7.8 trillion value in today’s prices.
Unresolved Issues of Existing Blockchain Technologies
There are numerous issues that remain unresolved with blockchain technologies. Firstly, there is lack of finality. For example, Bitcoin transactions are NOT final. Its protocol favors availability over finality, i.e. forks and lone blocks can form. Fork can happen when issues such as lack of consensus by developers in implementing standards and/or security issues surface.
Secondly, current proof-of-work (POW) consensus mechanism used by Bitcoin and Ethereum is energy-intensive considering the need for mining ultimately leading to higher electrical bills.
Thirdly, Ethereum requires developers build their smart contracts using a programming language called Solidity.
Fourthly, Ethereum currently does not support digital identity related to real-world verification.
Fifthly, Ethereum only supports 15 transactions per second.
NEO To The Rescue
NEO – China’s first original blockchain project with former identity as Antshares before the rebranding, announced the launch of its NEO Smart Contract System 2.0, to address these limitations and take blockchain technology to the next level.
While many fintech startups and ICOs are capitalizing on smart contracts through Ethereum blockchain, NEO’s technology shows better promise in terms of high certainty, high scalability, and better compatibility across applications along with support for digital identity.
Programming Languages Compatibility
NEO provides support for various advanced languages through compiler, resulting in more expedient development and deployment of smart contracts since it enables developers to create applications without having to learn another language. Besides .Net and Java, it aims to fully support Python and Go, which covers around 90 percent of developers in the world.
Integration With The REAL Economy Through Digital Identity
Anonymity has been touted as one of Bitcoin’s and Ethereum’s main features. However, this comes with an inherent disadvantage, which is the integrity of transactions. NEO addresses this issue by incorporating digital identity to its platform.
With its origin in China, blockchain experts believe the digital identity incorporation is a huge plus contributive to a mainstream adoption of NEO in China in the future. Furthermore, NEO has the support and approval of China’s regulatory agencies along with business communities. Beyond the middle kingdom, NEO’s superior technology over Ethereum enables better integration with real-world applications that require confirmation of identity.
“NEO aims to integrate itself better with the real economy. Only with the introduction of digital identity can we map offchain assets in a complaint manner,” says Da Hongfei.
Efficiency And Reliability
As briefly stated above, Bitcoin and Ethereum platforms encountered numerous security issues that led to forking in these blockchain systems. Furthermore, POW consensus algorithm consumes significant amount of energy, and there is a lack of finality.
NEO on the other hand, uses a superior delegated Byzantine Fault Tolerance (dBFT) consensus mechanism, which ensures finality of transactions and supports more transactions per second (compared to Ethereum’s 15 transactions per second, NEO supports up to 10,000 transactions per second).
“dBFT ensures finality, with availability compromised.” NEO founder Da Hongfei describes the comparison. However, he says that for purposes of smart contracts, this is more essential than availability.
“POW has strong availability, but it also has a big disadvantage, because it cannot ensure finality. Forks and lone blocks will occur easily. dBFT ensures finality, which means that once a transaction is confirmed by a block, it is confirmed permanently without being rolled back or revoked. In our point of view, finality is far more important than availability in an important financial system. And in practice, dBFT has been running for more than one year without serious network crash.”
Building Globalized Smart Economy
NEO is positioning itself at the forefront of blockchain technology with built-in support for digital identity-enabled smart contracts, ability to communicate with other blockchains through a cross-chain and distributed storage protocol, quantum resistant cryptography, and secure communication standard. NEO aims to build a globalized smart economy, wherein the redundant middleman is being removed, and trust factor between participants is enhanced through digital identity.
As NEO’s founder Da Hongfei stated, “Blockchain is still a quickly developing frontier,” and NEO will continue to work closely with “developers, our community, and even the institutions with whom we work.”