Hello everyone,

I'm often researching new coins to invest in, and NEO caught my eye, maybe because they copied part of my name. I've been using "Neoxian" back when NEO was just known as Antshares.

What I typically do is download the local wallet and purchase a modest amount of the coin, and start playing around with it and researching it.

One thing I'm trying to find out is if it's a real crypto-currency. And that means understanding it's consensus mechanism. Usually this is easy, Proof of Work, Proof of Stake, or some combination or variation.

NEO uses Delegated Byzantine Fault Tolerance (dBFT)

Hmm, well that's a new one. I won't even pretend that I understand how that works. I read somewhere that one could use their stake in NEO to vote on the consensus nodes (or bookkeepers) and I thought "cool! It sounds like Steem's Delegated Proof of Stake". But when I dug deeper, I found out that voting wasn't implemented.

I read this article:
http://storeofvalueblog.com/posts/how-centralized-is-neo/

It explains that NEO has seven fixed nodes that are selected by the NEO team.

Some choice quotes:

This was why I was so disappointed to find out that NEO was so incredibly centralized. Investing in NEO was akin to investing in a number in Da Hongfei’s personal database.

If any node goes offline, consensus cannot occur and the blockchain will effectively shut down.

Apparently that's just what happened on October and the whole chain went down for several hours.

Well that doesn't sound good at all. But maybe they will implement voting later?

Below is a blog post from City of Zion, an independant group of open source developers that work on NEO:

https://medium.com/proof-of-working/decentralization-from-coopetition-b10d7ce3b9d

One quote:

NEO will begin its decentralization by allowing well known commercial projects and communities to run consensus nodes

So, isn't this the exact opposite of decentralization? This is a central body allowing others to run consensus nodes.

Another quote:

All nominees for consensus nodes will go through a rigorous identification process before being voted in on MainNet. This process includes providing identification that can hold the owners of the consensus node host legally liable.

What? Really? So some central authority, probably a government will ID the consensus node runners and allow them to join the network. And they will be "legally liable"!

This is absolutely not a decentralized network. And not just because it is not implemented yet, but because the NEO team and City of Zion are adapting a philosophy of compliance, and catering to governments (the Chinese government).

To find all this out is very disappointing, I'll probably be exchanging my NEO for true decentralized crypto-currencies.

I like the way Steem does it. I'm a Steem witness, and I never had to identify myself. I never had to ask anyone's permission to run a Witness. I simply had to obtain votes from those with stake in the system.

This is how it should work.