While many think that scalability is the #1 challenge cryptocurrency and blockchain are currently facing — I would argue that real-world application is by far the most significant issue on the road to mass adoption.

In this article, I explore how the hyped, yet controversial, NEO and its Smart Economy are tackling real-world application, while taking a deep dive into the ecosystem and the secret support it has in its homeland country, China.

NEO DevCon, Amsterdam & Global Tour

Once I started to understand NEO better, to be transparent, I came to be more actively interested and invested in it. I am no expert but here is what I have gathered.

On January 30th, I attended the first ever NEO DevCon in San Francisco (attendance over 400-people). It was there I came to understand the platform’s mission — to utilize NEO as a fundraiser, blockchain ledger, exchange mechanism and asset tracker for the existing economic functions happening across a wide-array of new and existing industries.

NEO has most certainly succeeded in creating a global developer community and a wide-spread series of highly-engaged events for their community, both introducing and highlighting updates, dapps and tools for developers.

With their largest NEO event yet happening on the 14th in Amsterdam on their Europe tour, it’s very likely important and exciting NEO announcements are on the horizon.

The Smart Economy — [“Explain like I’m 5”]

NEO calls itself the “Open-Network for the Smart Economy.”

I like this concept because I don’t think our current economy runs at optimal intelligence and efficiency. Most precious bits of data are written on paper, stored in locations and maybe backed up on a vulnerable computer server somewhere.

NEO is looking to evolve and update the underlying mechanisms that run global economies. But what is their version of this “Smart Economy”?

It’s made up of three primary components…

Smart Contracts — You are likely familiar with Smart contracts from Ethereum, essentially coding the terms of a traditional contract in an automated agreement between parties, secured, verified and stored on the blockchain.

These smart contracts power the functions of applications as well as the terms for people investing in an ICO.

Digital Assets — The internet has millions of digital assets, from data to all forms of media, and blockchains like NEO can help us license rights, protect privacy and even enable far more efficient and trusted systems for these assets.

However, NEO goes one step further, acting as a platform for real-world assets to be digitized and managed via the blockchain. Think house titles, car registrations, art pieces with certifications of authenticity, maybe even the genetic lineage of your cat (okay the last one was a stretch.)

Did you know that in countries like India and Mexico corruption has led to people falsifying documents for the ownership of properties, essentially walking up to people’s doors and kicking people out of their homes and places of business? There is no public cross-verifiable proof of ownership, thus breaking critical trust; this needs to change.

Whatever the assets may be, having them secured on a trusted blockchain means that asset management can be enhanced, protected and updated for modern applications in a technological and fast-moving world.

Digital Identity — Tired of fake accounts, fake news or maybe even constantly inputting your private personal data on every website you visit that asks you to register?

More websites than ever require account activation and verification, and every time you input your personal data you are at risk. While we are regularly requested to input our identity, to date, there are few solutions to help us automate our digital identity.

Digital identity is essential to managing data, money, crypto and even social media accounts, and now even for these service providers to compile with government regulation. Blockchain gives us the ability to register digital identity, use it for endless applications bringing trust back to the internet.

NEO is Built for Business

In my conversation with Malcolm Lerider, the Senior R&D Manager at Neo, and I’m paraphrasing, NEO’s design philosophy from inception was not just based on helping fund new and disruptive decentralized-applications (like most platforms), all though it does that surprisingly well…

It was to on-board existing businesses, enterprises and companies that can benefit from blockchain solutions to streamline their operations. This is in addition to having an actual trusted-digitized network and marketplace to run and expand their business. This may be the most overlooked and under-appreciated element of Neo.

This is reflected in NEO’s blockchain architecture at its core. It is ready-made for real-world business applications. This is most notable via its 100% finality consensus mechanism, which is completely un-forkable.

Of the many apps that migrated to NEO from other systems, they mentioned that this design philosophy was a critical factor in them launching on NEO.

If you are a company with millions of users using a trusted product, you cannot risk a fork in the technology essentially dividing their consumer-base or your internal team. Ethereum is currently negotiating a fork within its community due to the advent of Ethereum ASIC miners, which will leave all of their dapps to decide their loyalty, thus potentially dividing the community and even user base.

You also can’t risk transactions only reaching 90 to 99% finality of confirmation, creating endless liability on transactions disputes, which would otherwise be credible.

While this may be a small issue for some, if you are doing millions or hundreds of millions in business, this could be a fault-line in an otherwise stable system.

It’s worth-noting that Neo recently resolved a programming-kink after the system paused in the nodes not reaching 100% finality, raising many questions, however Neo basically stated the resolution of this reflected the security of the system as it was easily able to resolve the issue and settle all pending transactions with 100% finality.

Unstoppable Ontology — Infrastructure on Fire!

Recently, NEO’s parent company, OnChain, launched an entirely new project, boldly branded as Ontology.

Ontology did not undergo an ICO, instead the coins were circulated via airdrops to existing NEO holders. Members of their newsletter received 1000 ONT and we even received 500-free Ontology for attending DevCon.

This, likely unintentionally, created a mad-dash to scoop up the tokens once they hit exchanges, causing the price to continue to sky-rocket from a low of about $1.30 at release to a high-now over $4.50 at the time of writing this, demonstrating it to be a powerhouse unicorn in an otherwise bare crypto-market.

But what is Ontology?

Ontology Basics Demystified

To be practical, Ontology deserves its own article and there are many great ones out there, but here are the basics in my own words….

Ontology recognizes the need for high-performance blockchain applications for both public and private professional use-cases, outside yet still inclusive of the NEO Smart Economy platform. They are treated as cross-complimentary systems, with Ontology being the underlying infrastructure and NEO being available economic layer that sits on top of it.

They are, however, entirely sovereign, separate, yet cross-operable when beneficial. In fact, Ontology is retrofitted to be interoperable with a wide variety of blockchains, not just NEO.

Until now, businesses without a comprehensive understanding and division dedicated to blockchain development have not been able to use these revolutionary tools for their own application. This hinderance has essentially secularized the industry, to crypto and blockchain companies and everything else tech, enterprise or otherwise. But the time has come for them to merge.

Ontology uses the systems of digital identity, blockchain frameworks, data protection and cooperation ownership and management, commerce-data search engine functionalities, altogether providing the full leverage for companies and their customers to use these blockchain tools to enhance commerce and consumer functionality.

This can allow users to secure verifiable identity, offering privacy protection, manage their data from a litany of applications and institutions, own this data, even distribute and exchange it for real-world value, creating a peer-to-peer and business-to-business trust network.

With the rapid onset of people buying up Ontology Tokens, it’s clear that the market understands the real-world value of this system, reflected in its immediate success.

Two Token Economics

Perhaps the wide-spread interest and acquisition of NEO and Ontology tokens is due in part to their generous staking mechanisms.

In the NEO ecosystem, many functionalities, including launching dapps require users to pay fees in their secondary token, GAS. These GAS rewards are then re-distributed to Neo token holders, as well as the time-based GAS token release which is algorithmically distributed across the system.

Want to now how much Gas you will get for holding Neo? Use this calculator: https://neotogas.com/

This means that simply holding NEO, and Ontology (which has as similar staking mechanism) can be additionally profitable to the price action of the coin. This two staking model serves so many economic benefits, that other tokens have started to launch similar models, including the popular VeChain.

From generous airdrops to continuous staking rewards, NEO understands that if you want people to participate in the smart economy, you have to incentivize them to do so and that’s just what is happening.

The NEO Coding & Design Made-Easy

Perhaps the most important and vital component to NEO’s architecture is the multitude of programming languages it supports, which now includes: C#, Java, Python, Javascript and even the updated .Net (Microsoft supported).

The NEO world is buzzing with excitement from traditional web and app developers, and even graphic designers, who can seamlessly use their skillsets to design applications on the NEO blockchain.

Real-world application and the mass adoption of cryptocurrency is directly contingent to sexy and simple user interfaces that are reminiscent of existing internet applications, and even automate and simplify existing tools. Where things can look and operate in a familiar way, yet under the hood be very different.

Developing on blockchain has been historically very difficult, requiring specialized programming languages — and often leading to very well-funded projects launching applications and user interfaces that look like they spawned in the early 2000s.

This is a huge pet-peeve of mine in this industry, and I think is a greater factor to start-up demise than people give credit. It’s not enough for things to work well, they have to look good for users.

This means that many of NEO’s dapps now launching look clean, futuristic, simple, up-to-date and function in intuitive and practical ways. This will continue to elevate the standard of the industry and assist in preserving success of the volatile ecosystem.

NEO Decentralized Application & Economy Universe

There are already 38-DAPPs and tokens launched, listed on Neo Council’s own dapp directory, with a huge pipeline of ICOs and over 100 dapps and start-ups who registered and recently participated in the second official dapp competition held by their open-source community City of Zion in partnership with Microsoft.

What has truly stood out is the professionalism, maturity and quality of the projects launched on NEO. The Gas fees help weed out shit-coins and the dapp competitions help ensure the cream of the crop rises to the top.

There are also a whole array of funding, marketing, legal and compliance support systems to assist in assuring that NEO projects play by the rules, all of which help add to the promise of their staying power, ideally reducing risk for hopeful investors.

While many platforms do little to help boost their applications, NEO, on the other hand, has taken many of their top stars on the road. Giving them stage time and wide-spread marketing exposure, thus creating a highly-collaborative and innovative culture, which spawned interoperable partnerships within the dapps themselves.

While some of these dapps and projects are brand-new, many are existing companies or research projects finally coming to market. Many already have currently live working-products and are already delivering on their promise, and now growing their market and client-base.

Some of the most notable NEO dapps and tokenized projects include:

Elastos: The goto revolutionary operating system of the smart web. Years of research and a rapid onset of new partnerships. Elastos is complex, compelling and has succeeded well out the gate. https://www.elastos.org/

TheKey: One of the greatest success stories for NEO dapps has been TheKey, a digital identity verification tool which has also announced a number of highly-credible partnerships in a short amount of time. https://www.thekey.vip/

RedPulse: This team of well-polished and seasoned professionals have created a blockchain research ecosystem and sharing economy for China’s financial and data markets: https://www.redpulse.com/

Trinity: One of the most promising off-chain scaling solutions, already demonstrating real-time peer-to-peer payment transactions with future partnerships for their technology in the works. https://trinity.tech/

Concierge: Decentralized Travel Booking marketplace reducing the fees and using the benefits of blockchain in the huge and often scammy travel booking marketplace. https://www.concierge.io/

Narrative: Perhaps one of the most eye-catching and interesting projects, Narrative is a social media network hat rewards content creators, moderators, and everyone who positively influences the quality of content on the network. 85% of all revenue is distributed to users. Aptly called the Content Marketplace. https://www.narrative.network/

NEO Scalability Advantage

NEO is designed to be highly-scalable, currently clocking 1,000 tps and ready built to handle up to 10,000 tps. With off-chain scaling solutions such as Trinity, NEO applications could easily hit 100,000s of tps.

NEO wants developers to build highly complex applications, where thousands of actions and interactions can be registered as transactions and operate without a hitch. Thus opening up the full power of the blockchain virtual machine.

The NEX Exchange ICO

While many ICOs have dipped below ICO price, the struggling success of ICOs have investors weary, unless they are a full-blown unicorn like WanChain.

NEX is slated by many to be the most anticipated ICO of 2018. NEX is a decentralized-exchange for the NEO ecosystem.

NEX will give users the ability to buy a wide-variety of alt-coins through a high-performance decentralized liquidity network. Using their off-chain matching engine, they will be able to compete or revival the performance of exchanges like Binance, while offering the security and protection of a decentralized-exchange.

They also have an infrastructure of partnerships with banks, allowing easy fiat gateways to direct purchasing of cryptocurrencies. Since at their core, the team is made of highly-technical developers, their goal is to offer the most advanced trading api for algorithmic bot trading. Promising.

The NEX team, including City of Zion Co-Founder, Fabio Canesin, recently did a Reddit AMA. Similar to NEO, NEX will offer staking rewards, but these rewards are perhaps some of the most generous we have ever seen in Crypto:

“The NEX staking rate will be from 25–75%. Committing to stake for one day gives a rate of 25%, which increases linearly to a rate of 75% if you are willing to stake for 2 years By staking rate, we mean the percentage of revenue you will get from NEX fee collection proportional to the tokens you hold. For example, if you hold 10% of all NEX tokens and are staking at a rate of 75%, then you will receive .10 * .75 = 7.5% of all fee revenue generated by NEX over that period.

We will confirm these details in an updated white paper release coming out today or tomorrow. ~ If you commit for two years, the first year will still be at 75%.”

The Hidden NEX ICO Easter Egg

What is perhaps most interesting about the NEX ICO is the fact that they have figured out a way to be above board with China’s strict crypto policies, effectively allowing Chinese Citizens to participate in the NEX ICO.

To my knowledge, this if the first instance I know of this under the updated policies China has issued toward cryptocurrencies and blockchain.

Maybe this is due to the fact that NEX is a fully licensed Eurpoean Security, complying with strict securities laws internationally. The founders at NEX have been adamant about not trying to evade securities laws as a undercover utility token, thus killing their ability to share profits, fees and rewards with users. Rather, they are playing by the book, while re-writing the rules of the game.

Hopefully, other coins can wise-up and follow suit. Not to mention, NEO is built for securities regulation and compliance.

I asked Fabio about the potential to use the NEX exchange to automate that participation of investors in NEO ICOs — automating the wallet-sync process to their browser widget similar to the process of participating in their own ICO. And while its unconfirmed the timing of such functionality, it appears it is on the agenda for the future.

Maybe this will be a key in opening up the ICO market back to China.

China & the State of Blockchain

Most people erroneously assume that crypto and blockchain is simply not allowed in China, and this misunderstanding has historically affected NEO price action.

Many wonder, if NEO is based in China, and China has strict regulatory policies, then this might effect the viability of its future, but that remains to be seen.

From my sources, it’s apparent that China is going through developing their regulatory mechanisms to monitor and manage cryptocurrency investing and utilization according to their own policies and politics.

Blockchain, however, is not dead in China, it’s thriving. In fact a $1.6 Billion Blockchain Innovation Fund was just announced in China, with over $400 million coming directly from the support of government backing. (Article on Coin Telegraph.)

The Chinese Government Institute, a government-led research body, also just launched a blockchain as a service platform for identity, supply-chain tracking and data management, under the supervision of the People’s Bank of China. (Article on Coin Desk.)

The Truth is China is incredibly smart and methodical when it comes to being pioneers and world-leaders in new technology and innovation. With the mounting pressure of supposed trade wars and tariffs, one can assume that they see the real tangible value of this technology.

It was also just released that China is leading the World in blockchain patents and government-backed cryptocurrency funds. While still wary, they are assessing how to balance their government currency policies with digital currencies, assessing the opportunity, threat and promise of crypto.

“The sovereign state is still the fundamental player in global politics, and carries with it the characteristics of the world financial system. Cryptocurrencies and other virtual currencies attempt to challenge the sovereign state’s right to issue currency, requiring the nationalization of currency issuance. China has a clear understanding of digital forms of money, and is actively engaging in relevant work. The central bank has set up a research group and a digital money research institute to explore the digitization of sovereign money.” — Huang Zen from the PBoC (Source on Coin Telegraph)

In fact, many are still anticipating announcements regarding regulatory and compliance stance on cryptocurrencies. For now, it seems like the business of blockchain is budding and booming in China. The ability for the general public to participate in the cryptocurrency market is still pending, and slowly starting to become both more strict and more open.

Perhaps with the advents of exchanges like NEX, using trusted systems of KYC and digital identity and NEO’s compliance-ready philosophy we can see major progress in this area in 2018.

Some have falsely hoped that China will give NEO its blessing, but that’s unrealistic.

Rather, it’s likely that China will give crypto and blockchain strict parameters for public access and use, and NEO will be equipped and prepared to jump on the opportunity the moment the well-guarded flood gates open.

NEO Gone Global

While NEO is a Chinese company, they are a global platform for blockchain applications and use-cases. It goes to say that NEO is currently tied to China in the public eye, and positive or negative political sentiment does get reflected in the market.

NEO looks to cement themselves as being a far-reaching open-source network available for bright talent all over the world to develop, get funding and run their innovative ideas upon.

NEO, Decentralization & Privacy

If you are looking for the most decentralized form of cryptocurrency, or the most decentralized platform for applications, then for now NEO doesn’t fit the bill.

Being ready-made for business, NEO has had to take a gradual and mindful approach to decentralization. They have been expanding their node network to trusted partners such as media companies KPN in the Netherlands, and even the notorious FenBushi Capital (source). Their constituent partners such as City of Zion and the NEO Council are now also running Nodes.

NEO also just expanded their seed node infrastructure, greatly expanding the speed of ICO smart contract processing.

Malcolm Lerider relayed during our interview that decentralization is the number one focus of the NEO team, as they are well-aware of the importance of this in the community at-large and in the integrity of their technology.

NEO Protection & Privacy

The elephant in the proverbial chatroom, however, is how NEO being a Chinese company may fall under certain censorship or privacy restrictions due to government regulations.

With such robust ambitions for data management, publications, rights and commerce, how will NEO protect the integrity of the content and material on its system if regulations get ugly? Or suspicious?

I would love to see a public response to this concern from the team, as it seems to keep some weary users and investors at a distance but is not often addressed.

I am personally working to develop an ICO and product on NEO and our team is taking this into account, although we feel confident about protecting the rights and privacy of our users.

That said, the applications being built on NEO need to feel they can uphold and put to work their original vision at scale, with little concern on limitations on the free and open nature of their product and the decentralized and distributed nature of blockchain. It’s critical.

NEO — 2018 Future & Beyond

Where NEO excels is in its forward thinking and future-proof architecture, on-boarding exciting and promising projects with passionate teams and the ability to execute and deliver on their promises.

Where NEO sometimes struggles, IMO, is in communicating thoroughly what is happening behind the scenes with their investors and developers. This is in part due to language barriers, of course, but it seems to me they are well-aware and are working on this effectively.

NEO is extremely well-funded, having reserved 50% of their tokens for their the council to allocate toward innovations. Released in 15-Million increments annually, they can use these tokens to fuel updates, developers, marketing, events and even assisting those developing on the platform. From what we can tell, Neo appears to be putting the money to good use.

While this was a controversial move, scrutinized by many, perhaps centralizing more of the currency. I do believe this gives NEO a unique competitive financial advantage, having the appropriate funding to advance and evolve as a company in a highly-competitive industry.

While other blockchains are promising similar scalability of 1,000 to 10,000 tps, very few have the dynamic programming languages available and a rock-solid developer community to actualize a real-world application of their systems.

The race is on, however, as more and more platforms launch into the market.

NEO Price in 2018 & Beyond

While I do my best not to speculate on price, I believe that due to NEO’s relatively small and hard-capped circulating supply, we can see solid positive price action in the near future.

NEO tokens are also currently indivisible if they are being staked, increasing the rarity of the token, a quality that has yet to be fully manifested in the market. Although, they may make the tokens divisible in the future.

As many have predicted, I too think that NEO hitting and surpassing $1,000 in the end of year or within next several years is possible and realistic. In the short-term, it can easily pass its $150 to $200 USD all-time high.

Ideally all of the wide-spread interest and use can justify a growth in its valuation, as many believe that 2018 will be for NEO what 2017 was for Ethereum.

No one actually knows or what may arise. While many platforms are new and un-tested, NEO has already proven its real-world application and staying power.

In Summary

The cryptocurrency and blockchain market is still very early on in its adoption, and it will be performance as well as quality and trustability of applications that will be a huge factor of value in the very near future.

After all, a beautiful home fully of all the widgets and luxuries only has value if someone wants to live in it and use it. What’s form without function? What are railroads without cargo?

It’s the generous nature of staking rewards and sensible approach of blockchain for business that originally made me interested in NEO.

And it’s this philosophy, approach and ability to deliver in real-time on promises which continues to drive my interest in believing it will continue to be a top cryptocurrency in the marketplace.

We have yet to see another project boldly take on the blockchain solution for business in such a robust and compliant manner — which is one of the most important and largest capital market-shares available World-Wide.

For NEO the future is bright…

Thanks for reading! Cheers,

~ Amateo

New Renaissance Visionary & Advisor to World-Changing Projects and Game-Changing People. Contact me: amateora@gmail.com.

Co-Founder of Crypto Virtual Summit & CEO of Avant Terra

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Thank you again for reading the article. Feel free to share it with your community or re-post it on a blog as long as your source the article. Much appreciated!

p.s. I am not a programmer and do not work for NEO or any of their affiliated companies. If you have a critique regarding the accuracy of any of the information, feel free to write me and I am happy to correct where proven necessary. Also, I was not paid to write this. I am an investor and an enthusiast of the platform, developing a project upon it in the near future. Thank you.