The advent of cryptocurrencies and its stellar rise, despite relative infancy and new technology, have arguably impacted the marketing world significantly. Booming in the previous year, 2017 saw a rush of millions of money poured into the cryptocurrency market. And considering its continuously growing network, there is no sign that 2018 will be any different.
Over the last few years, cryptocurrencies and other blockchain projects were able to gain very impressive returns that helped investors to be ridiculously successful. However, inevitably, many had experienced its dramatic declines as well. But despite the risk, more and more people are looking for the next big thing in the market which has the highest potential to multiply ones’ investment. And while there are hundreds of cryptocurrencies, that although represent opportunities to achieve sustainable growth, are also highly risky; and from which it is quite hard to predict which one gives the best result, this article will focus on the two of the most popular alternate coins (altcoins) of today – Ethereum and NEO.
Ethereum and NEO are both high-profile altcoins with massive community support and which many investors swear by one or the other. However, as “the competition for the coin is expected to become tougher in 2018 as new players enter the domain”, the question of whether which of the two will be left holding the scepter becomes less important – but rather, where will investments be safer.
To attempt to answer this question, let’s take a closer look at the two altcoins.
Ethereum versus NEO: Philosophical Differences
Ethereum, according to its website, is “a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third-party interference.”
NEO, on the other hand, is defined as a “non-profit community-based blockchain project that utilizes blockchain technology and digital identity to digitize assets, to automate the management of digital assets using smart contracts, and to realize a ‘smart economy’ with a distributed network.”
These respective definitions might sound remarkably similar – because, in many ways, they are. That is, both of them “run on a custom built block-chain that can move value around and represent the ownership of the property.”
Moreover, at first glance, these respective definitions might also imply that the two altcoins share the same objectives as both are aiming to dominate the cryptocurrency market by playing the similar roles of being the blockchain platforms for the new internet (or platforms that offer decentralized functionalities) such as Decentralized Applications (DApps), Initial Coin Offerings (ICO), and smart contracts. However, they aren’t, as there are subtle differences:
Ethereum’s goal is to develop its platform in response to new demands – that is, consolidating its role as the go-to platform for ICO’s. Whilst, NEO’s goal is mostly focused on developing its platform for future demands by realizing a so-called “smart economy” that will feature digitized physical assets which can be sold, traded, and leveraged through smart contracts.
Ethereum versus NEO: Backing and Partnership Differences
Because Ethereum is a certified government-agnostic, it is supported by some of the biggest global corporate names such as Enterprise Ethereum Alliance – making it enjoy popularity tointernational audience and thus, much larger support from the tech community.
All the same with NEO – the Chinese government might have gone far as to ban the ICO’s, but NEO remains to be China-based and Chinese-focused. Despite the country being seemingly unfriendly to the industry, NEO manages to receive backing from national banks and states – which allows it to capitalize on the huge Chinese market. Furthermore, it is also supported by Alibaba and Microsoft.
Ethereum versus NEO: Target Market Differences
There can be no doubt that Ethereum and NEO have the huge potential to become the next Bitcoin. Due to the impressive capabilities of their pluses to outweigh the minuses, both of which are continuously gaining popularity especially in comparison to other cryptocurrencies in the market.
Ethereum, which although has already been adopted by blockchain startups worldwide, is proportionally concentrated in the Western countries. Meanwhile, NEO is largely capitalizing in China.
Looking closely, Ethereum seems to benefit from a certain fallacy of thought that “West is the best” – which is quite true in terms of Western products catering to Western markets. But many fail to understand that Chinese investors are less likely to adopt Western technologies as they (like many East Asians) are far readier to support home-grown technology taking pride in and loyalty to national products.
NEO, however, might be having the advantage of a technologically-driven population that is nearly 1.4 billion people strong; not to mention that Chinese investors make up a very large percentage of the world’s cryptocurrency investors. But one should not fail to consider that the involvement of the Chinese government, which might have made NEO a state-mandated currency, plays a significant role in building a loyal following from Chinese investors.
Ethereum versus NEO: Where is your investment safer?
With the capabilities (i.e., both projects are open source and has massive community support) and differences (i.e., serving different markets and the opposite directions their visions are taking) that these altcoins have, should there really be a question of which among Ethereum and NEO is better, or should you invest in both?
While NEO appears and is turning out to be more investment-worthy – focusing on creating a “smart economy”, it should not be forgotten that Ethereum still holds the position of being the second most popular cryptocurrency in the world with a total market cap of $105 billion as compared to NEO’s $9 billion (as of January 25, 2018).
Thus, given that we are dealing with two very robust technologies, it might be better to conclude that there is certainly space aplenty for both altcoins to coexist.
And as to where your investment will be safer, perhaps the most suitable answer is in the altcoin where you can best tolerate the risk and that you understand well. There are more and more investors getting on board who often have a very limited understanding of the technicalities of the cryptocurrency they support, ending up investing based on brand loyalty and hearsays and even merely along the lines “Ethereum of China” NEO vs Ethereum.