NEO 3.0 Review
By: Amrit Mirchandani
Tags: Neo, Fintech, Blockchain, Cryptocurrency, Bitcoin

On July 10, NEO team announced the upgrade of their platform to NEO 3.0. Co-Founder of NEO, Erik Zink stated, “NEO 3.0 will be an entirely new version of the NEO platform built for large scale enterprise use cases. It will provide a higher TPS and stability, expanded APIs for smart contracts, optimised economic and pricing models, and much more. Most importantly, we will entirely redesign NEO’s core modules”.

So what exactly is to be expected from this major release of NEO?

Divisible token

NEO was an indivisible coin till now but now they are making it into a divisible token. This means as the price of the token rises, users can pay in a fraction of the token to conduct their business. Many analysts have pointed out that this will devalue GAS price but the effect has to be seen yet.

Non-fungible tokens

They also announced that they will be releasing a non-fungible token like ERC-721. This opens up the NEO blockchain for collectibles and various other use cases that require a non-fungible token.

Enterprise scale platform

They have mentioned it time and again that this will be an enterprise-scale platform. But very little is detailed in their announcement about how they are going to achieve this. To increase the TPS, they will refactor the code and core modules, optimize the network protocol and implement the feature manifest and permission system for NeoContract. They are also preparing for dynamic sharding and to detach state persistence and block persistence.

In theory, these should increase the TPS but we do not know the impact. NEO could process 1000 transactions per second in its 2.0 version. Although this is better than Ethereum, it is nowhere close to what an enterprise platform would require.

Cross platform Smart Contracts

With the help of NeoVM and Unified Smart Contracts APIs, NEO 3.0 will enable cross platform smart contracts that will work on any blockchain.

Adjusting the economic model

Indivisibility of tokens was one of the hurdles in utility and adoption of NEO. With this new release, the team is making changes to the economic model apart from divisibility. They are going to make a small increase in the supply of GAS every year and allow a fraction of GAS to be paid to the system as fees.

They are also going to reward consensus nodes — which is a great step in the direction of decentralisation. However, details need to be announced to see the incentives and sustainability of these rewards.

Decentralisation

In July, NEO took a step towards decentralisation. NEO network is planning an election of a city of Zion’s consensus node on to the NEO mainnet. City of Zion is an independent network of developers, designers and translators. It is also the main contributor to the NEO platform.

Conclusion

The announcement is exciting. But the details are too macro to gauge how this will impact developers’ ability to use NEO, especially at an enterprise level. But this news is very positive for the crypto community considering all the scaling problems and the loss of faith that Ethereum is going through.

To know more about NEO’s developments visit our Cryptocurrency Community.