How GAS cryptocurrency is used on the NEO blockchain

GAS cryptocurrency is one of the two tokens that power the NEO blockchain. The purpose of GAS is to enable the seamless execution of transactions on the network. In other words, you need to use GAS cryptocurrency to pay the subscription fees for using the NEO blockchain.

A closer look at NEO

Most people in the cryptocurrency space have heard of NEO. If your memory goes back far enough, you’ll know the company was formerly called AntShares. Founded in 2014 by Erik Zhang and Da Hongfei, it was China’s first open source blockchain platform looking to disrupt international trade.

NEO has often been called the Chinese version of Ethereum. That’s because the network also enables smart contracts and can support blockchain-based dApps.

Unlike Ethereum, NEO uses the Delegated Byzantine Fault Tolerance (dBFT) algorithm, in which elected bookkeepers are the ones who validate blocks. Moreover, NEO supports multiple programming languages and provides high speeds for processing transactions.

The Chinese company is known for going above and beyond to stay compliant with international regulations. Among other benefits, this strategy allows NEO to remain attractive to the Chinese government.

One of NEO’s unique differences from other blockchains is its two-coin approach. It offers NEO and GAS – each one with a different purpose.

How GAS cryptocurrency works

GAS cryptocurrency powers the NEO blockchain. While NEO gives owners the right to manage the network and vote for bookkeepers, GAS is the token that fuels the blockchain.

The circuit is simple. The network charges for transactions as well as for the storage of tokens and smart contracts. Companies or people who want to use the NEO blockchain must pay registration fees using GAS cryptocurrency.

These funds are then used to provide economic incentives for bookkeepers. So, every transaction validated and every new block created on the NEO blockchain generates more GAS cryptocurrency.

It’s a cost-effective way of maintaining the network and preventing abuse of resources.

GAS owners can recycle their coins back to NEO and gain dividends. So, when you exchange GAS for NEO, you’ll get more GAS cryptocurrency as a result of the development of the network. As the system grows, the cryptocurrency in your portfolio produces more funds.

The maximum total limit of GAS cryptocurrency is 100 million. Unlike NEO, GAS is divisible. The minimum unit of GAS is 0.00000001.

The technology behind GAS cryptocurrency

NEO developers built GAS technology on the Delegated Byzantine Fault Tolerance algorithm. Blocks on the NEO blockchain are validated by bookkeepers (users who are elected by NEO owners).

The system uses digital identities to identify node owners. This way, the network knows validators by name – they could be institutions or individuals. As long as their identity can be verified, they can be elected by NEO owners as bookkeepers and keep the network growing.

The mechanism is highly effective, so the NEO blockchain consumes fewer resources than networks based on the PoW or PoS consensus algorithms. It’s also secure and scalable, without sacrificing transaction speed. However, it is often criticised for this layer of centralisation that the blockchain relies on.

Where to buy GAS cryptocurrency

GAS cryptocurrency is attractive to investors because, unlike other digital coins, it provides passive income. You can exchange GAS for NEO, which essentially gives you shares in the network. As a NEO owner, you get paid rewards as the blockchain grows.

The downside? You can’t purchase GAS cryptocurrency with your credit card. In fact, GAS isn’t listed by many cryptocurrency exchanges, like Bitcoin or Ethereum. Some of the platforms where you can buy GAS cryptocurrency are Binance, Cointree, Coinswitch, and KuCoin.

Since you can’t exchange fiat for GAS cryptocurrency, you’ll need to buy another digital coin first – preferably Bitcoin. Other major cryptocurrencies you can use to trade GAS are ETH, XRP, or USDT.

To store GAS cryptocurrency, you need a wallet that supports NEO and GAS. Besides the official NEO wallet, called the NEO GUI wallet, other options could be the Ledger Nano S and Nano X, Atomic Wallet, or NEO Tracker. When choosing the right wallet for your NEO, make sure it supports the ability to receive your GAS dividends.

The takeaway

China’s ban on cryptocurrency may have slowed down NEO’s evolution, but the network is still one of the bigger players on the market. NEO cryptocurrency has positioned itself continuously among the top 20 digital coins by market cap.

GAS cryptocurrency is a fundamental element in the project, being the fuel that powers the NEO blockchain. If more companies choose NEO to generate and store smart contracts, the power of GAS can only go up with the trend.