Well if you haven’t heard of NEO, which was formerly called as Ant shares, also referred to as ‘The Ethereum of China’. The reason for the comparison is because of the similarity in features.
If you are new to crypto, here is our beginners guide to buying NEO in 2018. And in this article we will be discussing a few of the points listed below:
- What is NEO?
- What are the NEO and GAS tokens?
- Choosing a NEO Wallet that is best.
- Steps to buy another cryptocurrency from an exchange.
- Steps to exchange it for NEO.
- Steps to transfer NEO from the exchange into your own wallet.
- Disadvantages of leaving NEO in an exchange or a web wallet.
What is NEO?
Neo is the first of open source blockchain project that is built and based out of China. Neo works as a non-profit and a community-based blockchain project. NEO means new and young in Greek.
Neo was created in 2014 and is part of the GitHub since June 2015. It was initially launched Da Hongfei and Erik Zhang as founders. Neo upgraded from Antshares to NEO in June 2017. Da and Erik later went on to find another company called “OnChain,” a blockchain consulting service.
OnChain went on to distribute one ontology(ONT) token for every 5 NEO held by a user which will be used to vote on system upgrades, identity verification, and other governance issues on the NEO platform. OnChain was also listed in the list of Top 50 Fintech Company in China by KPMG. As we skimmed through their website, it clearly states that Neo aims to be the distributed network for “smart economy.”
Digital economy + Digital Identity + Smart Contract = Smart Economy
Smart Economy powered by NEO
As we mentioned earlier, NEO was created with a different motive of digitizing assets from the traditional market. NEO wishes to integrate digital assets, digital identity and smart contract under its platform.
NEO’s blockchain platform allows users to register, trade and multiple types of digital assets quickly. NEO helps in the decentralized digitization of assets in a highly secure and trustworthy environment, which in a way is free from third-party intervention.
Two forms of assets can be used in NEO:
- Global Assets
Global assets are assets that are recognized by a system in whole and can be recognized by all smart contracts and clients.
- Contract Assets
Contract assets are assets that cannot be used in other contracts and are only recognized in their specific contracts. These type of assets are recorded and stored in the private area of the smart contract and expect a compatible client to identify them.
There are specific keys to match the pre-defined protocols and standards to achieve compatibility with most clients using it to transact.
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Maintaining a digital identity has become prudent in the world of social platforms and business related transactions. The current crop of tech is outdated which makes it hard to manage a user’s online identity which also in other terms is quite expensive and insecure.
And for a business to become more reliable and build strong identity management, a digital identity is a must. Neo’s Digital identity feature is identity information of individuals, organizations, and other such things that prevail in an electronic form or data. NEO offers a safeguarded mode to store, transact and authenticate the digital identity which is efficient and quick, it includes a Public Key Infrastructure(PKI)X.509 digital identity standards.
Like we said earlier, NEO’s features aren’t outdated and pack the most exciting likewise security features verification of identity when issuing or using digital identities includes the use of facial features, fingerprint, voice, SMS, and other multi-factor authentication methods.NEO’s Digital Identity mechanism replaces the OCSP(Online Certificate Status Protocol) with the Blockchain tech to make it a more trusted platform to maintain digital identity.
NEO’s smart contract is a set of commitments that are illustrated in a digital format; these contracts contain agreements on how contract participants review these commitments. These contracts come in handy as blockchains are a decentralized, highly reliable system. Thus it is beneficial.
In simple terms, A smart contract includes its own protocols for negotiating the contract terms, it automatically verifies the contract and enforces the terms that are agreed on by the parties involved.
NEO Smart Contract 2.0 includes a lightweight Neo VM(Virtual Machine) has benefited like high certainty, high concurrency, and high scalability. Neo VM’s instructional setup offers an array of cryptographic instructions that help in optimizing the efficiency of cryptographic algorithms available in smart contracts. This enables millions of develops around the world to instantly create smart contracts.
Talk about Neo and Gas tokens
Neo has two types of token:
NEO has 100 million tokens, with 50 million of those tokens were distributed through a crowdfunding, and the remaining were locked up for a year till October 2017.
These 50 tokens are to be used for development and operation for the NEO ecosystem. Unlike other cryptocurrencies, NEO is not divisible, and the minimum unit will always be 1. The significant advantage of holding NEO tokens is that they get the voting rights as well as right to dividends in the form of GAS.
GAS also has a token of 100 million tokens which can be generated and is quite similar to NEO. Unlike Neo, GAS can be divisible by a factor of 1/10^8, which ultimately is created via decay of algorithm in about 22 years of time.
About 2 million blocks are said to be generated for every 15-20 seconds between successive blocks. The GAS is convenient for resource allocation and network charges for operations like running dApps( decentralized applications ), smart contracts and creating incentives for bookkeepers in maintaining the blockchain.
The holders of NEO can claim GAS tokens whenever they want to.
How to choose a Neo Wallet that’s right for you
Finding a NEO wallet that is suitable for all your needs can be a daunting task, but you might want to consider the following features before storing currencies into one.
- NEO and GAS compatibility: Before choosing a wallet, remember that not all wallets support every cryptocurrency. Select a wallet that conveniently stores NEO and GAS tokens.
- Ease of Use: The wallet you choose has to be elegant and provide a user-friendly experience. If you are a beginner, using cryptocurrencies wallets might be hard at first to store all your digital coins.
- Security and Backup features: Storing funds that hold a market value either online or offline makes it necessary to look for a big, secure wallet. If you are using a wallet either on a desktop, mobile or web features like advanced encryption, two-factor authentication and multi-signature functionality will help.
- Private Keys: The wallet must have a facility that allows you to own and control the keys you want. Private keys are crucial to have access to your cryptocurrencies, choose the one where you can have control of the keys at any moment.
Steps of how to open a free web wallet
In order to buy and store your first NEO token, you need a wallet. And we’ll be sharing you the guide to set up the wallet followed by the steps to buy from exchange sites.
- To set up a wallet, we ask you to go for Neo Tracker. It is the most user-friendly of all the wallets that are compatible with NEO and GAS tokens
- Head over to Neo Tracker and click on “New Wallet”. Enter a strong and secure password.
- Click on “Create”
- Now you will be prompted to download a file of keystore. Click on ‘DOWNLOAD KEYSTORE’, and we suggest you take the warning seriously and save the file either on a pen drive. Click on “Continue”, to proceed with the following steps.
- Now you will be given a Private Key, which will help you in accessing the wallet. To open up a file you can also print the private keys by clicking on ‘Print Paper Wallet’.
- Click on ‘Continue’ to have access to the wallet.
- Save your private keys by scrolling down to find ‘Your Address’, which includes a series of numbers and letters. Copy and store it in a place that is safe and secure.
- And now let us advance to the step of purchasing. We’ll be purchasing Ethereum to exchange it for NEO.
Also Read: Decoding the evolution of Blockchain 3.0
Steps on how to buy another cryptocurrency from an exchange
There is the wide range of exchange services that allow you to exchange Ethereum to Neo. We have here used Coinbase, as this platform is completely user-friendly allowing coins to exchange instantly.
- Enter Coinbase by clicking the link here.
- Click on the Sign Up button and enter your name, email ID and password.
- Verify your account by providing the phone number and uploading an image of your Identity Card and also before purchasing, verify your credit/debit card and bank account.
Purchasing via credit/debit card are simple but charges here are higher when compared to bank transfer, which is fairly slow.
- Once your payment is verified, click buy/sell on the top menu.
- Now Select Ethereum at the bottom of the page and the amount you want to spend or the number of coins you want to buy. Click the ‘Buy’ button
- Confirm the purchase by clicking on the ‘Confirm Buy’ button. Now you can buy Ether but do not close Coinbase yet as setting up will take a few more minutes.
Now using Binance we’ll show you how to exchange Ethereum for Neo.
- Click here and Click on ‘Register’ on the top right menu.
- Enter your email and create a strong password. And now click ‘Register’.
- You will receive a link via an email to confirm the email address. Click on the link to confirm it.
- Now you will be taken Binance as your email is confirmed. Press Login and enter the email and password you used to sign up.
- To save your cryptocurrencies from hacking, a message will pop-up to set up a two-factor authentication. We recommend you to take full use of this security feature to distant your account from the hackers.
- Head over to FUNDS -> Deposit Withdrawals.
- This section will show all the coins that you own.
- To find Ethereum, type Ethereum in the search box.
- Press ‘Deposit’ and you will be provided with a series of numbers and letters in the Ethereum deposit address. Copy it and save it someplace as you will be needing it in the near future.
Head back to Coinbase
- Under the Accounts section to locate your Ethereum wallet listed on the left. Click on ‘Send’.
- Paste the Ethereum Wallet address you just copied in the ‘Recipient Box’.
- Click on Continue’, after entering the amount you wish to send.
- Coinbase will ask you to confirm the account either with your phone number or password. It will take about 30 to 60 minutes for the coins to appear in your Binance Account unless there is a network backlog.
- Once you get to see your ‘available balance’ on Ethereum, trade them for Neo.
- As you enter the exchange page, you will have two options for buying Neo:
- Limit order: That allows you to manually set the price at which you want to buy NEO.
- Market buy: This fills your order at the best price available automatically.
- Click on the ‘Buy NEO’ and choose the buying options you wish to go for.
- In the ‘Amount’ box, find in the amount of NEO you want to purchase. You also have the option of percentage buttons that will allow an easier exchange of Ethereum for Neo.
- Head over to Funds-> Balances. You will find NEO in your NEO wallet.
Steps on how to transfer Neo from the exchange into your own wallet
Exchanges are not considered to be the safest and prone to attacks from hacking. There are have been cases in the past about people losing coins while storing coins in exchange. Thereby we recommend you to store them in a personal wallet.
Click the ‘Withdrawal’ button and enter the following information. NEO withdrawal address: Enter the wallet address you copied from Neotracker wallet. Withdrawal amount: Put in the amount of NEO you want to withdraw. Since you are a beginner, withdraw small amount at first before sending.
Once you enter the information correctly, press ‘Submit.’ You will be asked for code from the phone if you have used the two-factor authentication as a security feature. Enter and click ‘Submit.’
Now you will receive an email to confirm withdrawal. Click on the link that has been sent to you via an email. Get back to Neotracker Wallet. You will now see your Neo balance in the wallet.
Disadvantages of leaving your Neo in an exchange or web wallet
The significant disadvantages of leaving Neo in exchange or the web wallet is the centralized structure. As it is the decentralized structure making it easily accessible by hackers. As a newcomer into the crypto market, hackers find it easy in identifying newcomers.
There is a considerable amount of risk involved when leaving digital currency with the third party. If these exchanges are not insured, then there is a huge risk that you are taking. Exchanges and web wallets have partnerships with a few cryptocurrencies, whereas new coins take time to get listed on exchanges like Binance or Coinbase.
Although these exchanges are the most popular ones, they become the go-to target of hackers. Benefits of exchanges and web wallets have been able to include additional layers of security protocols in their systems, and as of now, it is hard to say that for how long they can assure the safety.
Exchanges and web wallets must be used tentatively. Put in the thorough amount of research and comparison in finding the best available web wallets and exchange sites.
THE BOTTOM LINE
To summarize, NEO has all the features that make it competitive against the likes of Ethereum and other cryptocurrencies. To make NEO the next big thing in the cryptocurrency market, its developers are working beyond the Asian countries to make it successful in the western part of the world. As an open source platform, NEO is all set to upset the digital world and its economy.
NEO also has a considerable amount of backing from giants like the Chinese Government and Alibaba. Although NEO gives a tough one for Ethereum, as of now, it is hard to compare between the two.
Have a few questions? Write to us in the comments section, and we’ll get back to you.