<![CDATA[Stories by Edge on Medium]]> https://medium.com/@EdgeTalks?source=rss-34bbcd4d4852------2 https://cdn-images-1.medium.com/fit/c/150/150/1*4Nae5x9M5tO9N7bygLk15w.jpeg Stories by Edge on Medium https://medium.com/@EdgeTalks?source=rss-34bbcd4d4852------2 Medium Sat, 14 Nov 2026 00:22:39 GMT <![CDATA[The Most Valuable Feature of Blockchain Technology]]> https://medium.com/@EdgeTalks/the-most-valuable-feature-of-blockchain-technology-ad55d8701050?source=rss-34bbcd4d4852------2 https://medium.com/p/ad55d8701050 Mon, 29 Apr 2019 17:03:02 GMT 2019-04-29T17:03:02.216Z There have been many proposed use cases for blockchain technology; some of them logical, some of them harder to justify. Fortunately, the most legitimate use case for blockchain is quite simple and applicable in every business scenario — facilitate digital transfer of value better than current systems.

Let’s start out by understanding where we are at in terms of transferring value, how we got here, and the issues that are in need of solutions that blockchain can provide.

A trade is a simple thing. You want something, I have that something, we can make a deal. Before mail, phones and the Internet, we’d do all these trades in person. One-to-one, peer-to-peer. We would physically exchange goods, and those trades were final. You would physically possess what you traded for, no reversals (unless otherwise agreed).

We quickly learned that making fair trades was a lot easier if we had a way to numerically represent value. After all, there was no guarantee that both traders had physical assets of approximately equal value, or an equal desire to trade them in the first place. Originally, due to its scarcity, sturdiness and general appeal, we used precious metals for this purpose.

There was a general agreement on the value of these metals, and everyone had demand for them. I could pay for some bread with a few coppers and the baker could then spend those coppers on whatever they pleased. An economy is created because everyone is able to trade with everyone through the use of a common asset.

Because these precious metals are physical assets, these trades are easy to finalize. One person hands over the coppers or gold, the other provides the goods or service, and business is completed. No messing around. You can’t physically undo the transaction (without theft at least).

A few people wised up and realized that with exclusive access to precious metals, they could create more ‘value’ and have the power to buy whatever they wanted. If everyone has already agreed that 3 coppers are the standard price of a loaf of bread, you’ve got an easy future ahead of you if you can just make 3000 new coppers.

Eventually, we replaced cumbersome precious metals with legal tender, cash in the form of banknotes and coins, on account of it being easier to carry around and calculate value with. Since cash is still a physical asset, trades using cash still provide finality. Unfortunately, this transition introduced an even more accessible exploit for those with the power to create more of this asset.

Keep in mind that cash is only representative of value, it lacks intrinsic value. When you print more banknotes, you do not actually create additional value. Value is determined by demand, so increasing supply without an equivalent increase in demand simply makes everyone’s money worth less.

In this process, called inflation, the missing percentage of value is shifted to those that control the newly created supply. Since the new supply is still accepted as legal tender, this mechanism — when left unfairly controlled — siphons real value from those without control and hands it to those that do.

This is the first problem that blockchain provides the tools to solve. By decentralizing control over the creation of new supply, we can prevent inflation from being exploited to extract value from those without that control.

The next leap for our economy was to go digital. If you are already transacting with something that is only representative of value, it’s not too much of a stretch to think this can be done without an actual physical asset. Out of necessity in such a case, there needs to be a condition that the supply of the digital asset is safeguarded, alongside the record of transactions.

Let’s examine how this process happens today. I want to place an order with a company for a product. My bank has a record of my balance. I request that an amount is sent to the retailer to pay for the product. The bank deducts the value plus a fee from my balance, and the product’s sale price is sent through the system to be added to the retailer’s bank balance. They send me the product, our business is concluded.

This is quite a few additional steps from where we started. Instead of being able to hand over the product’s value in cash and physically finalize my trade in a peer-to-peer manner, I was required to do a few new things. These things introduce new drawbacks.

Firstly, the trade is no longer peer-to-peer. If I require the use of digital infrastructure to send a digital payment, I need to use the services of the private entities that have the required infrastructure. A bank or payment processor can facilitate the transaction, but we need to pay for that privilege. Fair enough, though it should be considered that limited competition means these fees tend to be exploitative by nature.

Secondly, it is impossible for me to make that payment without the stamp of approval from the entity responsible for processing it. If they freeze my account, claim I have no balance, or just decide to prevent a specific transaction from happening at all, there is little I can do about it.

As we progress further into a digital age, more payments happen digitally, and this becomes a substantial risk. This risk is present regardless of malicious intent; the centralized entity acts as a single point of failure. Human, hardware, network or any other errors can still prevent an individual from being able to make payments. It doesn’t matter how urgent a payment is to that individual, the consequences and user experiences are the same.

This is the second problem that blockchain can be used to solve. By making the ledger publically verifiable and decentralizing control over the validation of transactions, we can, in essence, return these transactions to a peer-to-peer level. In effect, there is no single point of failure, no trust is required, and fees can be minimized.

In our jump to digital value transfers, we also created a new issue. There is no way to know or trust that any given payment was really finalized. No physical asset changed hands, so there is no physical ownership or subsequent verification.

I do not have access to my bank balance directly, nor does the other party in a trade. The infrastructure is outside of our control. Reversing or manipulating transactions is a simple matter; like changing numbers in a spreadsheet. This reliance on a centralized entity is what creates the trust component. As is the case with inflation of supply, consumers are required to trust a system that is stacked against the consumer.

Without the guarantee of transaction finality, there is always the risk that a transaction may fall through or be undone entirely. Perhaps you sold an item, received payment, dispatched the item for delivery, and then the payment was negated. You are now dependent on third-party arbitration or goodwill to see a fair outcome. No guarantee of finality results in an unstable and often unfair system. It can be summarized that a fair digital economy cannot be sustained on a centralized platform.

This is the third and final problem that blockchain may be leveraged as a solution for. Until this point, digital payments required third-party infrastructure, which negates finality due to the possibility of transaction reversal. If we can decentralize control over a public ledger of transactions and prevent that ledger from being tampered with, we create an environment in which finality can be guaranteed in a digital form.

Over the last few years spent learning about blockchain and cryptocurrencies, one thing has become rather apparent. Lots of blockchains are trying to solve the former two problems, but have failed to even consider the third. Finality is often an afterthought, sacrificed in favor of misleading scalability.

It is my belief that decentralization is necessary, valuable and beneficial to every participant of any economy. It prevents a minority group of corrupt or selfish actors from being able to influence or manipulate the system. It’s hard to place a value on such a thing, though by nature it is more valuable to the average consumer than it is to these entities.

On the other hand, the value of finality is known. There is a clear and defined benefit to a finalized transaction. It removes substantial risk, the kind of thing you usually need insurance or legal support for. At the very least, the value of finality is equivalent to the value of those expenses designed to negate risk; a substantial sum.

The most noteworthy and world-changing thing that blockchain can do to disrupt and replace our existing economic infrastructure is not to simply reduce the trust component; it is to decentralize so that the finality of a physical, peer-to-peer transaction may be mirrored in a digital form.

For this reason, it is my perception that a blockchain that fails to provide finality has failed right out of the gate. Without absolute finality, there is no guarantee that a transaction is irreversible, so any blockchain without it is essentially unfit for purpose as a tool for transferring value digitally.

]]> <![CDATA[Detecting faulty NEO consensus nodes through the use of MinerTransactions]]> https://medium.com/@EdgeTalks/detecting-faulty-neo-consensus-nodes-through-the-use-of-minertransactions-af0246457776?source=rss-34bbcd4d4852------2 https://medium.com/p/af0246457776 Sun, 10 Mar 2019 20:45:15 GMT 2019-03-10T20:50:14.373Z Discovering faulty NEO consensus nodes by using MinerTransactions

NEO’s consensus mechanism, dBFT, requires consensus nodes to come to an agreement about a potential block before it can be committed to the chain. This removes the possibility of blockchain forks and provides finality (irreversibility) for transactions as soon as they show up on the blockchain, which is great for the user experience, but it can result in delays as a trade-off.

Consensus nodes on NEO take it in turns to act as speaker by proposing a block. The other nodes check the validity of the block based on a few criteria, and if the block is valid, they sign their agreement. When 66% of the total number of nodes have agreed to a block, the network state is updated with the new block added to the chain.

If a speaker does not submit a valid block (whether it fails to submit a block at all or the block is invalid) within the designated time frame (currently 15 seconds), a view change occurs. Essentially this just means a new node will propose a block, in the hopes that consensus will be achieved. Unfortunately, that means another 15-second wait, so the next block will take roughly 30 seconds. These delays caused by view changes are undesirable, but the alternative would mean the loss of finality.

At the time of writing, NEO has 7 consensus nodes. By checking block explorers such as NeoScan, we can see that every 7 blocks, the block time is roughly doubled. Due to the deterministic nature of nodes being selected as speaker, this implies that a single node is failing to propose a valid block, causing a view change. So how do we figure out which node that is?

My solution here is not particularly elegant, nor is it likely to work forever; especially in the event that transaction fees are distributed to NEO holders instead of the consensus nodes. Ideally, this information would be retrieved and analyzed in a much more direct manner. But for now, this method works.

To start, I should note that every block on NEO contains what is called a MinerTransaction. An example can be seen here. If a transaction contained in a block had a priority fee attached, the MinerTransaction will send that fee to the consensus node that proposed the block (the speaker for that block).

This provides us with a cheeky way to see which consensus node proposed a specific block. To monitor the blockchain with this, we need to do two things. Firstly, we need to send priority fee transactions across a sufficiently large number of blocks. Secondly, we need to figure out which public address (from the MinerTransaction) corresponds to which consensus node. Let’s start with the latter.

On neo.org/consensus, we can see the current consensus nodes and their operators. It also includes their 33-byte public keys, which we can use to calculate the public address for each node. At the time of writing, these are the public keys for NEO consensus nodes:

  • COZ: 025bdf3f181f53e9696227843950deb72dcd374ded17c057159513c3d0abe20b64
  • KPN: 035e819642a8915a2572f972ddbdbe3042ae6437349295edce9bdc3b8884bbf9a3
  • NF1: 02df48f60e8f3e01c48ff40b9b7f1310d7a8b2a193188befe1c2e3df740e895093
  • NF2: 024c7b7fb6c310fccf1ba33b082519d82964ea93868d676662d4a59ad548df0e7d
  • NF3: 02ca0e27697b9c248f6f16e085fd0061e26f44da85b58ee835c110caa5ec3ba554
  • NF4: 03b209fd4f53a7170ea4444e0cb0a6bb6a53c2bd016926989cf85f9b0fba17a70c
  • NF5: 03b8d9d5771d8f513aa0869b9cc8d50986403b78c6da36890638c3d46a5adce04a

Now we need to turn these keys into public addresses. I like to use NeoResearch’s NeoCompiler Eco for this purpose.

Each public address on NEO is actually a kind of smart contract. It is created by combining two specific opcodes with the public key. We’ll need opcode 21, which pushes the next 33 bytes to memory, and opcode ac, which checks the signature. Let’s use the COZ pubkey as an example.

To create our AVM hex, we simply add 21 + public key + ac. Plug it in, and out pops the public address for the City of Zion consensus node, AedGJPWWALPZgtSXZKEVZs5vYEdxffX7xs.

Repeating the same step for each consensus node public key provides us with all of the public addresses for the current nodes.

  • COZ: AedGJPWWALPZgtSXZKEVZs5vYEdxffX7xs
  • KPN: ATwwcpZmPFWfMaZVMsvQwFcRnbWqhZx3ZF
  • NF1: AKNLArGjLisJB9mXvtSxASxHd9jaCBFs1B
  • NF2: ARtmDzcTZxHCYydqFxFw31d21CpSArZwi4
  • NF3: AJeAEsmeD6t279Dx4n2HWdUvUmmXQ4iJvP
  • NF4: AWHX6wX5mEJ4Vwg7uBcqESeq3NggtNFhzD
  • NF5: AXvbEb4TEy86LSaeMTZ57esTtgeqWeCF6q

That’s the hard part over with, now all we need to do is send a bunch of transactions with priority fees. To account for bad timing, we want to send one every 10–15 seconds for a few minutes. I sent approximately 30 transactions manually and checked the blocks for MinerTransactions. These are the addresses that showed up in the MinerTransactions for the blocks that contained my transactions:

COZ: AedGJPWWALPZgtSXZKEVZs5vYEdxffX7xs
KPN: ATwwcpZmPFWfMaZVMsvQwFcRnbWqhZx3ZF
NF: AXvbEb4TEy86LSaeMTZ57esTtgeqWeCF6q
NF: ARtmDzcTZxHCYydqFxFw31d21CpSArZwi4
NF: AJeAEsmeD6t279Dx4n2HWdUvUmmXQ4iJvP
NF: AKNLArGjLisJB9mXvtSxASxHd9jaCBFs1B

As suspected, only 6 nodes are receiving MinerTransactions. That means our missing node is not proposing valid blocks, ergo it is the faulty node causing delays on the network.

Referencing our list reveals one of the NEO Foundation nodes to be responsible, with the address AWHX6wX5mEJ4Vwg7uBcqESeq3NggtNFhzD. Today, all we can do is yell at NEO to sort their node out. In the future decentralized environment, we would just revoke our votes for this node and replace it with a better candidate.

By checking this address on NeoScan, we can also get an approximation of when the issue started (this definitely isn’t perfect, as not every block contains transactions with fees, which allows us to differentiate nodes via the MinerTransactions).

This was a fun little investigation that was probably unnecessarily complicated and will soon be rendered moot by changes to NEO’s design or improved consensus analytics, but hey, it works!

I hope it was interesting to some of you.

]]> <![CDATA[An Eventful Year: NEO Meetups, Workshops, and Hackathons in 2018]]> https://medium.com/@EdgeTalks/an-eventful-year-neo-meetups-workshops-and-hackathons-in-2018-5bd268cd4627?source=rss-34bbcd4d4852------2 https://medium.com/p/5bd268cd4627 Fri, 21 Dec 2018 18:34:15 GMT 2018-12-21T18:50:04.127Z NEO has been very busy this year. In addition to the core development progress, we’ve seen a level of community building/outreach that no other project in blockchain can seem to match. I thought it would be cool to look back on all the events and hackathons that NEO hosted or supported over the course of this year.

It should be noted that I am not including any large-scale blockchain conferences (other than the NEO DevCon), no matter how notable. Any project leader can show up to an event and hold a few interviews, or offer a few sound bites in a speech. This is a post about the NEO team’s tangible efforts to encourage decentralized community development by hosting dedicated NEO workshops and meetups around the world. To this end, I have attempted (no promises, this was a lot of data to go through) to omit all events without direct support/representatives from the NEO core team (sorry Dylan, I’ll buy you a beer at DevCon!)

I think this is a huge indicator as to the motives of the core NEO team and is something far too few people know about. There is still this ridiculous notion floating around that NEO is reliant on the Chinese government to succeed, despite the massive global community that has been built to support the platform’s long-term success.

Two things to note before the list. Firstly, a lot of these events would not have been possible without the hard work of various NEO dApp project leaders and other community members. By no means do I wish to undermine their contributions by giving full credit to the NEO core. A lot of people pitched in to make these things happen.

Secondly, I’d also like to give a huge shout out to NEO News Today for its consistent and excellent coverage of all news within the NEO ecosystem. This list would not have been possible without it. For those of you who do not know, I started writing for NNT in July and joined as an editor in October. I feel incredibly blessed to have the opportunity to work with such a kind and talented group of individuals. I have much to learn from each of them.

Without further ado, here’s the list.

January

8th: NEO Meetup in Dublin, Ireland

10th: NEO Developer Meetup in London, UK

11th: NEO Developer Workshop in Hamburg, Germany

12th: Blockchain Mania #6 in Hamburg, Germany

13th: NEO Community Meetup in Amsterdam, Netherlands

13th: NEO Programming Day in Shanghai, China

20th: NEO Smart Economy Meetup in Vienna, Austria

30th/31st: NEO DevCon 2018

February

10th-11th: NEO Community Meetup in Tokyo and Osaka, Japan

23rd-25th: NEO at START Hack 2018 in St. Gallen, Switzerland

24th-25th: NEO at HackCU IV 2018 in Boulder, Colorado

March

3rd: NEO APAC Tour in Marina Bay Sands, Singapore

5th: NEO Smart Economy Meetup & Workshop in Tokyo, Japan

8th: NEO Developer Workshop in Ho Chi Minh, Vietnam

9th: NEO Developer Workshop in Cambridge, UK

11th: NEO Asia Tour in Taipei, Taiwan

12th: NEO APAC Tour in Melbourne, Australia

16th: NEO Sydney Meetup in Sydney, Australia

16th: NEO Seoul Workshop & Meetup in Seoul, South Korea

April

12th: NEO Meetup & Dev Workshop in Tokyo, Japan

13th-15th: NEO x QRC Global Hackathon in Tokyo, Japan

14th-15th: NEO Conference and Hackathon in Amsterdam, Netherlands

17th: NEO Europe Tour in Lisbon, Portugal

19th: NEO Smart Economy Blockchain Meetup in San Fransisco, US

20th: NEO Europe Tour in Madrid, Spain

22nd: NEO Europe Tour in Paris, France

24th: NEO Europe Tour in Vienna, Austria

26th: NEO Europe Tour in Zurich, Switzerland

May

7th: NEO Community Meetup in Santiago, Chile

12th: NEO Community Meetup in Rio de Janerio, Brazil

14th: NEO and Niobium in Sao Paulo, Brazil

June

6th: NEO Python Workshop in Tel Aviv, Israel

9th: NEO Blockchain Challenge in Shenzhen, China

14th: NEO Smart Contract Workshop in Rotterdam, Netherlands

17th: NEO Blockchain Challenge in London, UK

20th: NEO Workshop in Geneva, Switzerland

23rd: Weekly NEO Hackathons in Tokyo and Osaka, Japan

July

1st: Yahoo! NEO Blockchain Meetup and Workshop in Osaka, Japan

20th: NEO Blockchain Creator Competition in Shanghai, China

August

10th: NEO Blockchain Introduction Class in Shanghai, China

24th: NEO Blockchain Advanced Class in Shanghai, China

24th-26th: NEO Blockchain Challenge in Tokyo, Japan

September

3rd & 5th: Smart Economy Meetup & Blockchain Summit in Montevideo, Uruguay

5th: NEO Meetup in Cyberjaya, Malaysia

9th: NEO Blockchain Open Class in Shanghai, China

19th: NEO Consensus Week Meetup in Singapore

22nd-23rd: NEO Blockchain Challenge in Chengdu, China

28th-30th: NEO Black Sea Hackathon in Tbilisi, Georgia

October

2nd: NEO Blockchain Meetup in Helsinki, Finland

20th: NEO Blockchain Open Course in Shanghai, China

20th-21st: NEO Blockchain Hackathon in Rotterdam and Delft, Netherlands

23rd: NEO Meetup and Workshop in St. Petersburg, Russia

26th: NEO Meetup and Workshop in Berlin, Germany

27th-28th: NEO Camp Hackathon in Berlin, Germany

November

3rd-4th: NEO Blockchain Hackathon in Zurich, Switzerland

10th: NEXT/NEOFANS Meetup in Hangzhou, China

23rd-25th: Hack Junction NEO DAO Voting in Espoo, Finland

30th: NEO Blockchain Meetup in St. Petersburg, Russia

December

8th-9th: NEO SPCC Hackathon in St. Petersburg, Russia

That’s over 75 days of NEO events this year (and I definitely missed some). Not bad eh. Of course, this is only a list of events. We’ve also seen solid progress on the core infrastructure, the formation of multiple new dev communities, and various impressive projects joining the network.

This is the reality of what progress towards decentralization looks like. The NEO community outreach has gone far above and beyond what any other blockchain project has achieved (to my knowledge). Sure, there’s value to a pile of partnerships, but do not mistake those partnerships for realistic progression towards the future of blockchain. The goal of blockchain is to put power back into the hands of the people and to hand off control of these platforms to their respective communities. It seems no project is prioritizing this on the same level as NEO.

At this point, it feels like it wouldn’t particularly matter what happens in China. The NEO team and broader community have spent vast amounts of time and resources educating developers about NEO. Progress on this platform is not tied to the core team. That is the heart of decentralization, and it is why NEO will not be easily stopped.

]]> <![CDATA[An Introduction to NEO & the genius of Erik Zhang’s dBFT]]> https://medium.com/@EdgeTalks/an-introduction-to-neo-the-genius-of-erik-zhangs-dbft-2c2fb10178d4?source=rss-34bbcd4d4852------2 https://medium.com/p/2c2fb10178d4 Sat, 10 Feb 2018 23:12:45 GMT 2019-05-01T22:15:14.780Z I’ve been really interested in Blockchain technology lately. Like everyone else it initially came to my attention with the rise in popularity of Bitcoin. I even spent a short while mining Dogecoin with my PC, and trying to convince my parents to lend me the money to build my own little mining farm. But I was at an age where life has other things in mind for you, and I lost contact only to find it once more in 2017 as it entered the other social spheres I was still a part of.

Like most of those in my position, I saw the investment opportunity, only this time I had reached a point in my life where I had the resources to dabble just a little. I started buying up small amounts of whatever seemed popular, and learning about blockchain technology whenever possible. The idea of an immutable, public yet trustless network was incredibly appealing; it possesses the power to disrupt entire industries. I started picking my investments a little more carefully, looking for coins with untapped potential. It was around this point where a project called AntShares was gaining a large amount of interest, and with a $5 buy-in I wanted to know what all the fuss was about. I took a look at the whitepaper.

The AntShares Network proposed something quite interesting. Rather than the traditional single-token models that other cryptos used, there would be two tokens. One token would be used for governance. It gave you a say when it came to managing the network, reimbursing you for your investment with your fair share of the network’s fees (fees for using the system, not transaction fees which are optionally enabled by nodes and taken by them) for as long as you held your share.

The fees would be paid with a second coin, the utility token. A mark of the network’s adoption, it existed as fuel for the network. Any project or business that wanted to use the platform, perhaps to release a dApp (decentralized application), would pay using the fuel. This fuel would then be redistributed to those that held the governing coins. They could then use the fuel to interact with dApps or trade it as a currency. I found the proposal quite interesting, but I’d read concerns regarding the centralized nature of the network. I threw in a modest sum, and started reading about the consensus mechanism. Finding consensus is the heart of any cryptocurrency, so I’d only understand those concerns if I understood how AntShares planned to function.

I knew enough about cryptos at this point to have a good understanding about how Proof of Work functioned. It seemed pretty brilliant; decentralized, fair, trustless and incentivized. But I also saw things that concerned me. Forking, for example. It seemed to me that Nakamoto’s vision was for a decentralized and immutable platform, but forking seemed to be a fatal flaw in that vision. What’s the point of having an immutable network if it can be made mutable again? Maybe it was a question of scale, and it didn’t matter much at this point, but moving forward it seemed bizarre. This technology had the potential to reshape the world and bureaucracy as we know it, but bureaucracy would never welcome the new technology if it didn’t have finality. You can only trust an immutable ledger for as long as it can remain immutable. Delegated Byzantine Fault Tolerance declared that it had solved that particular issue.

Erik Zhang’s dbFT consensus mechanism claimed three major selling points. Firstly, it scales much better. Secondly, it solves double-spend problem and is Byzantine Fault Tolerant (as any blockchain should be), but also allows true finality. Thirdly, it can remain decentralized. Considering the claims I’d heard declaring the opposite (and the fact that no other crypto in existence can offer all three), I had reason to continue.

dBFT works on a relatively simple basis. There are a bunch of consensus nodes that run the network. One of them is elected to propose a block, formed from gathered transaction data. This speaker node broadcasts the new block, and the other nodes check the block’s validity and either sign their agreement or reject it. If 2/3 of the total nodes agree, the block is considered valid and added to the chain. If they don’t agree, another node is elected to act as speaker and broadcast a new block proposal. Consensus repeats. The consensus nodes themselves are private individuals or businesses that decide to run them, and they are voted in/out by the NEO token holders. It is truly decentralized, it’s just not as distributed as we’re used to, and it can confidently move from a private network to a decentralized one.

Turns out the ‘centralization’ aspect of NEO was rather comparable to IOTA’s central coordinator; they both exist only as training wheels. A network where anyone can run a node with no barrier to entry sure makes distribution easy. But that approach with NEO would end quite badly; the consensus mechanism needs a network that agrees with itself, so you can’t risk starting it off with potential bad actors. Instead, NEO needed to distribute one piece at a time. First of all, you need a network that is proven to work. All seven nodes owned by NEO would obviously reach consensus; they are operated by the same people and they would only propose valid blocks. You get a 100% validation rate, but also 100% control of the network by NEO.

The next step was to expand the network by allowing nodes to be operated by the first few strategic partners to NEO, such as the City of Zion developer community. Since the consensus mechanism wants to see a 2/3 majority on a new block proposal, that means to be decentralized, OnChain could not be permitted to run 2/3 or more of the nodes (and not have sufficient voting power to influence others). Adding strategic partner nodes meant that 7 nodes was no longer enough to decide on blocks alone, but you still guarantee the network won’t struggle to reach consensus (everyone wants the same thing.)

From this point, the NEO governance model can take over. With the training wheels off, NEO holders can vote in new nodes (which can be run by those who pay the 1000 GAS registration fee and ideally have digital identity in place so they can be held accountable) and vote out nodes they don’t want. With the system’s arbiters managing nodes, the network can expand without fear of bad actors. In addition, since you need 2/3 majority to force a block, the network is almost impossible to disrupt and therefore incredibly fault tolerant, while still maintaining the rapid, decentralized consensus needed to keep the network fast and stabe. You’ve also got both financial and legal incentive to not run a malicious node. The end result is the most secure public ledger platform ever created.

Unlike PoW or PoS, there has to be a consensus for a block to be created in the first place . That means somehow, someway, 2/3 of the active nodes need to agree on a block proposal. This means a few very important things. Firstly, true finality. There are no orphan blocks or forks with NEO. You can’t say one block is true and another isn’t. There are only valid blocks added, and that means there are only valid transactions. No double spends (otherwise, the block proposal wouldn’t pass validation), and no confirmations required. If it’s on the blockchain, it’s there forever. True immutability, true finality. You can’t really ever trust a network that doesn’t have these traits. That’s why confirmations exist. To build your confidence enough to let your doubt slide, and to make reversal trickier. They need not exist on a truly immutable network.

Most consensus mechanisms make it very simple to join the process. You can start mining to get involved with the decentralization of Bitcoin, or you can set up a node or stake a wallet with Proof of Stake. These networks, despite mining pools & whales, will still remain more distributed than NEO will ever be. That’s a sacrifice that the NEO team chose to make to allow the network to be so far beyond its competitors in every other regard. Fortunately, the governance is still in the hands of NEO holders — mostly businesses that run on the network and early investors. Sure, it’s a little prohibitive, but those two groups of people not only have a vested interest in the security and stability of the network, but they are also the ones that welcome the compliant nature of NEO since it protects their assets. NEO isn’t controlled by any entity like a company or government. It’s controlled by the holders, big and small. It’s nice to be a part of it, and I’m not just talking about the dividends!

Learning about dBFT is what secured NEO’s place in my portfolio. The rebrand from AntShares also introduced us to NEO’s vision; the smart economy. Like Ethereum, NEO is a dApp platform. You can use the smart contract functionality to run your own project or business on the blockchain. NEO takes this a step further, by aiming to integrate this new technology into the world’s existing architecture rather than simply disrupt an industry or two.

The big step here was Digital Identity; the idea that you could link your IRL identity to a digital representation so that anything owned by your digital identity was also owned by your IRL identity. That means any law that applies to you, can also apply to things owned by your digital identity. Tie that in with digital assets like cryptocurrencies or say, a digitized pink slip or house deed, and you end up with a functional economy backed by rule of law. Everything can be traded, trust-free, with no middleman needed to validate everything. You get all the benefits of one big global network, but you don’t lose your legal rights in the process.

Thanks for reading if you made it this far. Check out /r/NEO and the Discord, the NEO community is awesome. Also much love to Da Hongfei and Erik Zhang for their extraordinary vision for the future.

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