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NEO: A Closer Look at the 7th Largest Crypto

Feb 27, 2018

There are over 1,500 different cryptocurrencies in circulation. Some of the more prominent ones such as Bitcoin, Ethereum, Litecoin, and Ripple have been well publicized. These coins have experienced exponential growth over the past year, resulting in significant returns for investors. There are other coins, however, that have thrived despite a lack of widespread media attention. One of these coins, NEO, has established itself as one of the major forces in the crypto world. Comparing NEO to a more well-known crypto such as Bitcoin makes for an interesting case study.

In terms of similarities, there are a few that are apparent. Both coins seem to be popular among the cryptocurrency community with market caps in the top ten of all cryptos in circulation. Bitcoin is currently the largest, with NEO in seventh. There is also the fact that both cryptos have seen tremendous growth over the past year. Bitcoin rose by nearly 2000% percent in 2017, increasing from roughly $1000 per coin to start the year and nearing $20,000 at the coin’s peak.  NEO also managed to make significant gains, going from roughly $0.14 per coin to $135 by February of 2018. A large portion of cryptocurrencies benefited from last year’s upward momentum swing, and these two coins are no exception. The last noticeable similarity between the two is the limited supply of both coins. Bitcoin supply is limited to 21 million, while NEO has a 100-million-coin limit. While there are certainly similarities that exist between the coins, there are noticeable differences as well.

As the first cryptocurrency in existence, Bitcoin has benefited from the publicity advantage that comes with being a first-mover. This can be evidenced through the $175 billion market cap of the coin, more than double the next closest coin (Ethereum). Although NEO has experienced a significant rise in value over the past year, it maintains a market cap of only $8 billion despite having more coins in circulation. This can be attributed to the fact that Bitcoin has a price point that is 76 times higher than NEO ($10,350 vs. $135, respectively). While price may be the most obvious difference between them, the function each coin serves is the most significant. Bitcoin’s original purpose was to act as a long-term value storage vehicle, and has since morphed into a benchmark against which other cryptocurrencies are measured. The creators of NEO gave the currency a wider ranging functionality than was intended for Bitcoin. While NEO acts as a wealth storage investment, it is also a platform for creating smart contracts and decentralized apps, DApps. The increased utility of NEO above what Bitcoin offers bodes well for the coin’s long-term sustainability.

Look for the launch of the Quantamize Crypto products soon.