One of NEO’s competitive advantages over Bitcoin and Ethereum is its ‘pragmatic’ approach toward centralization, argues founder Da Hongfei.Leveraging centralization
One of NEO’s main criticisms is its centralization, both politically and architecturally.
Right now, the NEO Foundation and its related organizations—for-profit NEO Global Capital and non-profit NEO Global Development—hold enormous power. Moreover, final decision-making is largely up to co-founders Da Hongfei and Erik Zhang, and executive John deVadoss.
Since inception, NEO has leaned into centralization. As said in the whitepaper, founding members and their team are “responsible for strategic decision-making, technical decision-making, and specific implementations. In other words, they have control.
This is deliberate. From the beginning NEO has planned to start as a centralized protocol and decentralize over time. In an interview with CryptoSlate, Da Hongfei said:“To mitigate those centralized disadvantages with NEO, we have a very clear plan to shift from the current more centralized to a more decentralized model in the future. It will be beneficial to keep relatively more centralized for efficiency. NEO is not the first blockchain project in the world. We’re still catching up with leading projects.”
The leading projects Hongfei is referring to? The two leading cryptocurrencies by market capitalization:“If we work the same way as Bitcoin or Ethereum we will be less efficient compared to today’s development. We have seen some leading projects already stall in terms of their technological advancement.” A different pace of development
And he isn’t wrong. The rate of Bitcoin development is painfully slow. Soft fork upgrades like SegWit, which increases the number of transactions the Bitcoin network can handle, only recently achieved 50 percent uptake. This is for a popular initiative activated in August 2017.
Although the pace of Ethereum deve...