NEO is a platform with a purpose. Can it compete with Ethereum? Or better yet, does it even need to?
Overview of Ethereum and Neo
While both NEO and Ethereum have generalized blockchains that provide a toolbox for would be developers, their objectives differ. I would summarize each platform’s objectives as such:
Today, cryptocurrencies are primarily traded on centralized exchanges where userfunds are at risk to hackers and platform managers. Decentralized exchanges(DEXs) allow users to retain control of their funds as trades are mediated by smartcontracts on a blockchain by ETH.Unfortunately, today’s DEXs are slow, hard to use, andare restricted to trades on a single blockchain. Neon Exchange (NEX) is a new decentralized exchange that embodies these ideas.NEX will run first on NEO, before later expanding to support exchange on Ethereum and other blockchains . Neon Exchange (NEX) is a newdecentralized exchange that solves these problems, leveraging a high performanceoff-chain matching engine built with Elixir to handle massive order volume, allowcross-chain exchange, and support more complex trading APIs. Many people donot use DEXs because they cannot trade with their national currencies. NEX is thefirst DEX that will allow its clients to enter the exchange with fiat currencies suchas USD, powered by a global network of licensed third parties. Exchange services are critical not just for users of cryptocurrencies, but also formany other applications built upon blockchain technology. NEX envisions a vibrantecosystem of web-based decentralized applications running across publicblockchains such as NEO, Bitcoin, and Ethereum. These applications requiretools to interact with, make transactions upon, and send data across chains. Toachieve this vision, NEX is developing the first cross-chain browser extension.Web applications can use this extension to collect payments for goods in anydigital currency, make trades and transactions across blockchains, and interact withsmart contracts across NEO and Ethereum. All of this cross-chain functionality ispowered and made possible by the NEX off-chain matching engine.NEX is issuing 50 million tokens to fund development and future expansion, ofwhich 25 million will be sold to the public. NEX tokens are in the process of beingregistered as a security (first in Europe), and will provide holders with a share ofall revenue generated by the exchange and related services. Revenue per user willbe determined by the number of NEX tokens they hold and the length of time theycommit to staking their tokens. The minimum fee share rate is 25%, increasinglinearly to a maximum of 75% when tokens are staked for two years.
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Neon Exchange (NEX) aims to combine the performance of centralized exchanges with the trustand security properties of decentralized exchanges. The system consists of three main components:an off-chain trade matching engine, a smart contract where trades are executed, and a paymentservice where global assets such as NEO and GAS can be converted to tokens that can be transferreddirectly by smart contracts, making them compatible with the exchange. In the following sections,we describe each component in more depth.One major problem with today’s decentralized exchanges is lack of support for national currenciessuch as USD. NEX is solving this project through banking partnerships with companies around theworld. Through this network of partners, users will be able to get cryptocurrencies directly usingnational currencies to store in their wallets and trade on the exchange.
Neon Exchange (NEX) Website: http://neonexchange.org/
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