NEO Announces Plans for 3.0 Update

Beginner's Guide to NEO Cryptocurrency

A new post released today on the official NEO blog details the China-based smart contract platform’s plans for their upcoming 3.0 update.

The announcement is described as a sneak peak of what users can expect from NEO in the coming months. NEO co-founder and Core Developer Erik Zhang had this to say:

“NEO 3.0 will be an entirely new version of the NEO platform, built for large scale enterprise use cases. It will provide higher TPS and stability, expanded APIs for smart contracts, optimized economic and pricing models, and much more. Most importantly, we will entirely redesign NEO’s core modules.”

Included in the announcement is a long list of improvements that the NEO development team intends to implement for the 3.0 upgrade, including bug fixes, strategies for increasing the network’s transactions per second (TPS), and improvements to NEO’s smart contracts (including eventual cross-blockchain support).

Changes to the Economic Model

The most intriguing changes coming with NEO 3.0 are the vaguely-described modifications to NEO’s economic model.

NEO, for those who are unfamiliar, uses a two-token model. Fees on the network are paid with a divisible token called GAS, while the indivisible NEO token gives users the right to participate in network governance decisions.

“We designed a dual-token economic model for NEO, which has proven to be a very successful model,” said Zhang. “However, there were also problems: NEO was indivisible, and GAS could not be divided when paying for system fees (sys_fee). These issues were roadblocks for the utility of NEO and GAS tokens. To solve this problem, some adjustments to the economic model need to be applied.”

What follows is a list of several possible solutions to the above problem:

  • A small increase in the supply of gas every year
  • Reward consensus nodes
  • Make NEO divisible
  • Allow gas to use the decimal part when being used for system fees

Zhang clarifies that these are all considered “suggestions” at this point in time, which are being actively discussed.

The post concludes with a reference to NEO’s official GitHub, where tech-savvy users can take a firsthand look at the code behind these proposed improvements to the platform.

All of this is much needed good news for NEO, which is currently down 7.28% in the last 7 days at time of writing.

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