Neo (NEO) the Chinese Ethereum alternative has been a tough sale to blockcain users, but Phantasma (SOUL) plans to change all that.
Phantasma is the first non-Chinese blockchain project for NEO that I have seen it is also based on a very interesting idea. The idea is create chain of on-chain and off-chain users that will serve as a network for the transmission of information.
The information will be stored and transmitted in NEO based decentralized applications (dApps). The Phantasma team plans to build a variety of these dApps each designed for a specific information related task.
The network is built on top of crypto-wallet addresses. Each wallet address functions as a mailbox for information. The mailboxes will be compatible with normal email addresses and can communicate with email systems outside the blockchain like Gmail. The first dApp using such a mailbox, Phantasma Mail is now available. Secure mail is supposed to operate in mobile phones and on the web.
Decentralized Content Distribution
The ultimate goal of the network is to facilitate decentralized content distribution that big corporations, governments and censors cannot interfere with. A good way to think of Phantasma is as Telegram on steroids.
The Phantasma Mail should be hard to trace because it will be move through many different users’ wallet addresses. Individuals will receive payment in the SOUL NEO token in exchange for using the system.
Phantasma is similar to The Onion Router or TOR the privacy route created by the US government. TOR makes tracking difficult by bouncing messages through a wide variety of computers connected to the internet. Phantasma aims to do the same thing on the blockchain by bouncing messages around from wallet address to wallet address.
Phantasma is planning a token sale planned for 2nd Quarter 2018. Its development plans to release a software development kit (SDK) designed to let anybody build Phantasma based products in 3rd Quarter 2018.
A potential gamechanger Phantasma plans to release in 4th Quarter 2018 is relay nodes. The Phantasma relay nodes are side chains that will let developers around the blockchain transaction speed limits. That should enable developers to create solutions capable of handling a large scale volume of transactions.
One way that Phantasma can get around the blockchain scalability problem or blockchain speed limit is to use NEO’s cross-chain or sidechain protocol NeoX. Sidechains like NeoX allow faster speeds by creating a bypass around the blockchain’s encryption and limited size.
The hope is that Phantasma will split off from the NEO network in 4th Quarter and become its own blockchain. That can be considered a hard fork.
Will Governments allow Phantasma?
The nodes are supposed to power a Digital Commerce app for Phantasma that is supposed to let anybody deploy his or her own decentralized e-hop. The Digital Commerce app is supposed to appear in 2nd Quarter 2019. Video streaming with heavy data loads is scheduled to start in 4th Quarter 2019.
If Phantamsa can really build a totally decentralized ecommerce and video distribution system it might make a lot of money. Phantasma might also get shut down by authorities pretty quickly. Its proposed system sounds like an enabler for tax evasion and a distribution network for porn.
It is hard to imagine an authoritarian government; like that in China, tolerating something like Phantasma operating on a blockchain based within its borders. Among, other things Phantasma sounds like an attempt to pierce a hole in the great firewall of China.
Unfortunately, I was unable to find any prices for the SOUL token listed. That probably means its ICO has not been comleted.
Is NEO Authoritarian Capitalism for the Blockchain?
Neo (NEO) is an attempt to build a bigger and better blockchain alternative to Ethereum based in China. Even though some of its technology is impressive, NEO has not caught on like Ethereum has.
The major reason for that is NEO is based in China, and many users suspect it is a front for the Chinese government. A likely scenario is that NEO is a sort of Trojan horse designed to give the People’s Bank of China (PBOC) some control over the blockchain.
NEO seems to have a lot of resources behind it, and it is unclear where they come from. Though it is obvious that something like NEO, would not be able to operate in an authoritarian nation like China without government backing or at least tolerance.
The NEO project to build a “Smart Economy” on the blockchain; can be described as an example of what China observers like Hal Brands call “authoritarian capitalism,” or authoritarian mercantilism. That system consists of a capitalist economy ruled by a benevolent government directed by a technocratic elite.
Such thinking is hardly new and it is rooted in Chinese history. The historic Chinese Empire had a capitalist economy and a government controlled by a cadre of scholar technocrats. A similar ideology is popular in France, the country where many of China’s 21st Century technocrats study, and in the European Union.
A Semi Centralized Blockchain
What NEO is building can be described as a “semi-centralized” blockchain where a central authority decides what decentralized applications (dApps) are allowed and approves them.
That authority achieves more control by building and releasing its own dApps, and by holding competitions for developers. The NEO team as developed several wallets and clients for other blockchains including the NEO Wallet.
A big advantage to NEO is that its creators have designed a suite of desktop applications. A major flaw with several blockchain systems that I have seen is that they lack desktop applications. That limits the usefulness of such systems to those of us who use old-fashioned desktops in our jobs.
Another part of the NEO strategy is to work closely with select blockchain projects such as Phantasma. The NEO team is sponsoring a wide variety of events and forums for the blockchain community and working with governments. Its boss Da Hongfei visited the European Parliament in May. NEO itself is working with governments in places as diverse as Ontario and South America.
There is NEO’s central authority which functions like a corporate head office. It puts out monthly progress reports and has a clear chain of command, which makes NEO more like corporation than a traditional open-sourced blockchain project.
Another way that NEO is trying to centralize the blockchain is through its app store. That App store, functions like GitHub and offers a wide variety of proprietary and second-party dApps.
A good way to view NEO is as a corporation like Alphabet (NASDAQ: GOOG) or Amazon (NASDAQ: AMZN) that is developing a centralized open-sourced marketplace. The Google and Amazon open-sourced marketplaces are directed by central authorities but they have been highly profitable. Phantasma looks like an attempt to build open-sourced marketplaces similar to Google, Amazon, YouTube, and Netflix (NASDAQ: NFLX) on the blockhain.
Amazon and Alphabet (NASDAQ: GOOGL) have demonstrated that such marketplaces can be extreme lucrative. It is no coincidence that Microsoft (NASDAQ: MSFT) recently bought GitHub – the most popular open-sourced marketplace for computer code and developer tools. If NEO can create a GitHub for blockchain solutions, it might become extremely lucrative.
Is the NEO Cryptocurrency a Good Investment?
Many observers will wonder if NEO’s semi-centralized blockchain might be more viable and valuable than Ethereum’s in the long run.
NEO’s prospects in the short run are limited because of its lower profile and suspicions about government control. Ethereum (ETH) has the inherent advantage of being based in Switzerland and being completely decentralized.
Despite those limitations NEO still has a lot of value. Its token achieved a Coin Price of $39.70, a Market Capitalization of $2.581 billion, and a 24-Hour Market Volume of $84.906 million on 18 June 2018. Coin Market Cap reported that there was a Circulating Supply of 65 billion NEO and a Total Supply of 100 billion NEO on the same day.
All this makes NEO a good value and investment in cryptocurrency. NEO is among the best run of cryptocurrency and blockchain projects out there today. Phantasma (SOUL) might be as good as NEO at some point.
There are some improvements that should be made to NEO. It would make a lot of sense to add NEO to the Bancor liquidity network. That would make it convertible with ERC20 Ethereum-based cryptocurrencies, which would increase NEO’s utility. Bringing out a social currency for NEO would also make a lot sense.
Despite its’ limitations NEO is a great contrarian investment in cryptocurrency, and Phantasma will be some day too. If you are looking for a viable alternative to Ethereum (ETH) – NEO is probably it.