NEO 3.0 Roadmap Revealed, Co-Founder Erik Zhang Explains Key Changes to Smart Contract Platform

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The developers of NEO, a leading platform for building and deploying decentralized applications (dApps), have officially released a roadmap for NEO 3.0, which consists of a several codebase modifications that are intended to enhance the blockchain network’s performance.

Erik Zhang, the co-founder and core developer at NEO, revealed via Twitter on April 29th, 2019 that the changes made to the platform’s protocol with NEO 3.0 will allow for “large scale commercial application ready” solutions to be developed on the blockchain network.

NEO 3.0: “High Throughput, Enhance Stability”

Zhang, a graduate of Shanghai University, explained that the changes activated with NEO 3.0 will enable “high throughput, enhanced stability, an optimized smart contract system,” and a wide selection of tools for infrastructure development.

As detailed in a recent Medium blog post authored by Zhang, the upgrades associated with NEO 3.0 will allow developers to create dApps that cater to a diverse set of enterprise-grade business requirements.

Working With Academia, Industry Leaders To Develop Governance Mechanisms

According to NEO’s development team, the proper governance of blockchain networks involves managing processes that ensure the “long-term evolution” of a distributed ledger technology (DLT)-based network. Zhang also revealed that in 2019, the developers of NEO “will be actively collaborating with experts from the academia, industry and community to explore various governance mechanisms including liquid democracy, futarchy,” as well as other techniques.

As noted by Zhang, “economic models [are often] tightly interlaced with governance mechanism, therefore they will be treated as an integrated system.” He added that NEO’s Enhancement Proposals (NEPs) “regarding on-chain governance changes will be published if satisfying outcomes are achieved” after conducting adequate research.

dBFT To Provide “Single Block Finality”

Some of the new features that will be included in NEO 3.0 consist of an upgraded network consensus protocol, called the Delegated Byzantine Fault Tolerance (dBFT) mechanism. As described by Zhang, dBFT is “a consensus mechanism designed specifically for blockchains.”

A typical dBFT implementation involves “a set of consensus nodes [that] are selected through a voting process, and these consensus nodes jointly generate and validate blocks. As consensus nodes are required to come to a shared consensus on a new block before it is committed to the blockchain, dBFT provides single block finality, meaning the NEO blockchain cannot be forked and transactions are irreversible.”

Moreover, “once a transaction is confirmed” on a blockchain network that uses dBFT, “it cannot be reversed or cancelled.” This, Zhang explained, is a “necessity” for financial applications.

NEO 2.x To Be Deployed Soon

The Chinese developer also mentioned that the development of dBFT 2.0 began in the last quarter of 2018 and that it was finalized by Q1 2019. The developers of NEO are now planning to deploy NEO 2.x to the platform’s mainnet.

Enhancements To Pricing Model For NEO 3.0

The NEO platform utilizes a dual-token economy, meaning that like Ethereum, the NEO network uses two native tokens, the NEO and Gas tokens, to facilitate transactions on its network. Gas “is used to pay transaction fees and smart contract execution fees,” Zhang wrote. However, there are certain issues with this approach such as the “relatively high cost of deploying and running smart contracts,” the NEO co-founder noted.

This problem, Zhang believes, “leads to a reluctance in smart contract usage and development.” According to Zhang, NEO’s “current pricing model becomes a significant obstacle in the Gas application scenarios, and thus hinders the continuous growth of DApp development and usage on NEO platform.”

The set of system-wide upgrades that will be activated with NEO 3.0 have been developed to address the current challenges with NEO’s pricing model, Zhang explained. He added that this will be achieved “by significantly reducing the deployment and execution costs of smart contracts, thereby expanding the application scenarios of Gas and increasing the number of DApps.”

NEO 3.0 To Include “Built-In Oracle Implementation”

Additionally, NEO 3.0 will include “a built-in oracle implementation” which will allow smart contracts “to access Internet resources during execution.” NEO 3.0 will also address issues such as “inconsistencies between nodes when accessing Internet resources” which will be “resolved thanks to the security and efficiency of dBFT 2.0.”

Changes that will go into effect with NEO 3.0 will also “redesign the peer-to-peer (P2P) protocol, add support for the UDP communications protocol, and enable compression options. This is expected to greatly improve the TPS and stability of the network.”

Upgrades To NEO Virtual Machine

As noted by Zhang, the NeoVM is “a lightweight virtual machine for executing smart contracts. It features fast startup, low resource consumption, and supports multiple high-level programming languages to allow developers to build contracts with familiar tools.”

When NEO 3.0 is launched, the NeoVM will be “completely decoupled from the blockchain and become a pure virtual machine.” Implementing an independent virtual machine will enable “easy implementation of native contracts,” allow developers to work on “application scenarios of NeoVM outside the blockchain,” and the “smooth integration of NeoVM into any integrated development environment (IDE)” and “easy debugging of smart contracts without loading blockchain data.”

The NeoVM will also include support for “static members” and “exception handling.” Other changes that NEO 3.0 will introduce involve the integration of NeoFS, which is “a distributed decentralized object storage platform integrated with NEO.” Additionally, NEO 3.0 will feature NeoID, which is “a decentralized identity protocol built on NEO.”

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