While all nearly all cryptos have some kind of market value and can be bought and sold on exchanges, some are primarily monetary instruments used for crypto investing (like Bitcoin, which was originally conceived as a kind of “digital gold”), while other are more technical, like Ethereum, which was built to be the foundation of a new kind of software application or contract.
NEO, or neo crypto, belongs to this latter group. In fact, it’s often described as a rival or alternative to Ethereum, whose token, Ether, is one of the most popular and valuable cryptocurrencies.
In this article, we will dive deep on NEO crypto to explain the following:
• What is NEO?
• How is NEO Used?
• Types of NEO Cryptocurrency
• Is NEO a Good Investment
• Where to Buy NEO
What is NEO?
The purpose of NEO is to register, trade, and circulate multiple types of assets on its NEO blockchain. Designed by developers Da Hongfei and Erik Zhang, NEO aims to be an open network for the smart economy, by allowing users to store and exchange digital assets.
Originally known as Antshares, the project was rechristened NEO in 2017, two years after the code was first introduced.
How Is NEO Used?
NEO hosts smart contracts, one of the most foundational ideas in cryptocurrencies. Smart contracts are self-executing agreements typically used for the exchange of digital goods, or digital assets. They are verified entirely digitally and go into effect without any third party or authority enforcing them. The contracts are written into computer code and then stored on a digital ledger like a blockchain.
Different blockchain projects are designed to support these contracts, and NEO is one of the most prominent. NEO also supports DApps, or decentralized apps. These are both functions that Ethereum also serves.
Benefits of NEO over Ethereum
NEO has a few attributes that may make it an improvement over rival Ethereum.
• It allows smart contracts to be written in a variety of programming languages. These include C#, Java, and Python. In contrast, on Ethereum developers can only use Solidity, which is considered niche.
• It can handle transactions faster. NEO’s network can handle up to 1,000 transactions per second, vs. Ethereum’s approximate 15 transactions per second.
One area of focus for NEO is developing digital identification for users and traders. This digital identification system is meant to help NEO work better with regulators, as one of the goals of the project was to create a more regulatory-friendly system.
NEO co-founder Erik Zhang wrote in 2019 that “we keenly recognize governance’s pivotal role in the long-term evolution of a blockchain as the common good collectively owned by stakeholders and more broadly the entire surrounding communities.” These are not crypto-anarchists.
Recommended: Crypto Guide for Beginners
Types of NEO Cryptocurrency
There are two kinds of cryptocurrency associated with NEO: NEO and GAS.
GAS is supposed to be the fuel that NEO runs on (get it?). When you hold NEO tokens, you earn GAS over time. Gas is used to pay transaction fees and smart contract execution fees, according to NEOs developers. It cannot be purchased with dollars (although you can use other cryptocurrencies).
Basically, GAS is given to those who do the computational work of keeping NEO running, and can be used within NEO. Some 100 million GAS tokens will be created roughly over the next two decades.
How much are these currencies worth?
There are over 70.5 million NEO currently in circulation (out of a total of 100 million that were created when the block launched). As of March 2021, NEO is valued at $41.26 and has a market cap of around $2.9 billion.
There are currently about 10 million GAS in circulation, with a market cap of around $119 million. As of March 2021, GAS is valued at $11.83.
Is NEO a Good Investment?
Investing in crypto is considered a high-risk pursuit. Like any cryptocurrency, NEO has experienced highs and lows since its inception.
NEO rode one of the first crypto booms, hitting nearly $197 in January 2018. The price dropped substantially, trading between $16 and $20 from July 2018 to September 2020. Like other cryptos, it rose in price in late 2020 and early 2021.
Some observers think that NEO, thanks to its emphasis on regulatory compliance, could benefit from the Chinese government’s strict oversight of the cryptocurrency industry.
Cryptocurrency regulations are a huge issue for cryptocurrency miners, users, and investors, and NEO is no different. Anyone looking to invest in NEO should be mindful of how various governments, especially in China, are looking at cryptocurrency mining, smart contracts, and smart assets.
Where to Buy NEO
Investing in NEO crypto is a bit different from popular ways to invest in cryptocurrency. While many well known cryptocurrency tokens or assets are available on US-based crypto trading platforms like Coinbase (or PayPal or Square), NEO is not available on these platforms.
If you want to buy NEO, which is tradable, you have to use a platform like Binance . The exchange offers NEO trades with both US dollars and bitcoin. It’s also a good idea to remember that as with any crypto investments, investors are expected to pay cryptocurrency taxes when applicable.
NEO is a crypto with a purpose: to support smart contracts and DApps, in much the same way Ethereum does, but with a few notable differences that may be considered improvements.
The information provided is not meant to provide investment or financial advice. Investment decisions should be based on an individual’s specific financial needs, goals and risk profile. SoFi can’t guarantee future financial performance. Advisory services offered through SoFi Wealth, LLC. SoFi Securities, LLC, member FINRA / SIPC . SoFi Invest refers to the three investment and trading platforms operated by Social Finance, Inc. and its affiliates (described below). Individual customer accounts may be subject to the terms applicable to one or more of the platforms below.
1) Automated Investing—The Automated Investing platform is owned by SoFi Wealth LLC, an SEC Registered Investment Advisor (“Sofi Wealth“). Brokerage services are provided to SoFi Wealth LLC by SoFi Securities LLC, an affiliated SEC registered broker dealer and member FINRA/SIPC, (“Sofi Securities).
2) Active Investing—The Active Investing platform is owned by SoFi Securities LLC. Clearing and custody of all securities are provided by APEX Clearing Corporation.
3) Cryptocurrency is offered by SoFi Digital Assets, LLC, a FinCEN registered Money Service Business.
For additional disclosures related to the SoFi Invest platforms described above, including state licensure of Sofi Digital Assets, LLC, please visit www.sofi.com/legal. Neither the Investment Advisor Representatives of SoFi Wealth, nor the Registered Representatives of SoFi Securities are compensated for the sale of any product or service sold through any SoFi Invest platform. Information related to lending products contained herein should not be construed as an offer or pre-qualification for any loan product offered by SoFi Lending Corp and/or its affiliates.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Third Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.
Crypto: Bitcoin and other cryptocurrencies aren’t endorsed or guaranteed by any government, are volatile, and involve a high degree of risk. Consumer protection and securities laws don’t regulate cryptocurrencies to the same degree as traditional brokerage and investment products. Research and knowledge are essential prerequisites before engaging with any cryptocurrency. US regulators, including FINRA , the SEC , and the CFPB , have issued public advisories concerning digital asset risk. Cryptocurrency purchases should not be made with funds drawn from financial products including student loans, personal loans, mortgage refinancing, savings, retirement funds or traditional investments.