2017 was a breakout year for many different cryptocurrencies. These innovative digital assets took center stage, and everyone was talking about Bitcoin, Ethereum and the rest of the crypto market. Alongside the well-established Bitcoin, other cryptocurrencies began to emerge and create a name for themselves.
One such example is NEO, a China-based cryptocurrency which in 2017 managed to reach a market cap in the billions and establish itself as a top 10 crypto. NEO was recently launched on eToro, so we’ve put together this handy guide, to help you familiarize yourself with the crypto.
Click here to start investing in NEO !
Cryptoasset investing is highly volatile and unregulated in some EU countries. Tax on profits may apply.
What is NEO?
Launched in 2014, NEO (previously AntShares) was created as a blockchain application platform, and a smart contract system called NeoContract. The company behind NEO is called Onchain, headed by Chinese entrepreneur Da Hongfei. There are two currencies used in the NEO network: NeoGas (GAS), which is used to execute apps, and NEO, which is used for management purposes, such as voting on the platform. Like a publicly traded company, each NEO represents one vote, which is the reason it cannot be divided.
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NEO is often referred to as the “New Ethereum” or “Chinese Ethereum,” since it has quite a few things in common with the world’s second largest crypto. For example, they can both be used for the creation of smart contracts and can also serve as a platform for programming blockchain apps. However, there are several differences between the two.
NEO vs. Ethereum: Main differences
- Centralization vs. Decentralization: while NEO is democratic, Onchain still has complete control over the platform and could, for example, upgrade the entire network without needing user consensus. In contrast, Ethereum was created to be completely decentralized.
- The cryptocurrency: Ethereum blockchain platform’s token is called Ether, however, it has become so popular that the name Ethereum is now synonymous with its own. Ether is the only cryptocurrency needed for using the Ethereum platform. In contrast, NEO has both the NEO and the GAS tokens, each used for a different purpose.
- Forking: A fork is created in blockchain when an update is rolled out and not enough members on the network approve it, resulting in a split and the creation of a parallel network. One of the most famous hard forks in cryptocurrency history took place on the Ethereum network and eventually created Ethereum Classic. With NEO, this simply cannot happen, since its coding doesn’t allow forks.
- Supply: NEO was created with a hard-capped limit of 100,000,000 tokens to eventually be released into circulation. Ethereum on the other hand, has a potentially unlimited supply, dictated by miners on the network.
What drives NEO’s price?
As with all financial assets, there are quite a few factors which could affect NEO’s price. However, there are some that may have greater impact than others. One such factor is the price of Bitcoin, which often serves as the benchmark for the industry, and can spark either an upward or a downward trend, depending on which direction it is moving.
Another factor that can impact NEO actually comes in contrast to Bitcoin’s price. At the end of 2017 and the beginning of 2018, the Chinese government began cracking down on cryptocurrencies, heavily regulating the industry and even banning them in certain ways.
However, when Da Hongfei created NEO, he had the Chinese regulatory authorities in mind. Essentially, he created NEO in such a way that complies with regulations and could relatively easily be adjusted to match new ones, if they are put into effect. This means that NEO can sometimes have an inverse relation to Bitcoin prices, if the latter’s price movement are created by restrictions in China.
Trading NEO on eToro
Like so many other cryptocurrencies, NEO skyrocketed in 2017, reaching a market cap in the billions and becoming a top 10 cryptocurrency (by market cap). NEO is the most recent addition to eToro’s ever-growing selection of cryptocurrencies, joining the likes of Bitcoin, Ethereum, XRP, Bitcoin Cash and others, as we continue to enable our clients to manage all of their online trading and investing needs in one place. Buying and selling NEO on eToro is just like trading any other asset, and can be done using both our online trading platform and mobile app.
Click here to start investing in NEO !
Cryptoasset investing is highly volatile and unregulated in some EU countries. Tax on profits may apply.
*Please note: NEO has a limited daily invested amount on eToro. When it reaches its daily limit, it will be closed for new investors and reopened the following day. Therefore, it may be periodically unavailable for investments throughout the day.
Tags: criptomonede, crypto, cryptocurrency, cryptomonede, Neo