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Your guide to trading NEO (NEO)

Capital.com's guide to trading NEO (NEO): Everything you need to know on how to trade NEO. No commission. FCA and CySEC regulated.
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Why is NEO important to traders?

Founded under the name ‘AntShares’ in 2014 by Da Hongfei and Erik Zhang, NEO is a blockchain platform and cryptocurrency designed to build a scalable network of decentralised applications (dApps). The NEO token is non-divisible meaning you cannot buy or sell half a NEO token. As a project designed to build dApps, NEO competes with cryptocurrencies such as Ethereum and EOS. People within the crypto community refer to NEO as a ‘utility token’. A utility token is a coin, in which owning it, gives its holders the access to services provided by the project. With the case of NEO, the coin gives access to the decentralised operating system. The NEO project aims at creating what the founders refer to as a ‘smart economy’, this is a network where digital assets, digital identities and smart contracts all coexist within in the blockchain. NEO is one of the twenty largest cryptocurrencies in terms of market capitalisation.

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You can trade NEO CFDs on Capital.com 24/7.

How to trade NEO CFDs

An individual has two options when trading in the cryptocurrency market. Firstly, they can buy actual cryptocurrency on exchanges, such as buying NEO on an exchange like Bitfinex, so they own the NEO themselves. This is considered a long-term investment, as the individual is waiting for the price to rise significantly, so they can sell their crypto coins on an exchange. Alternatively, they can trade a contract for difference (CFD) on a particular cryptocurrency, and speculate on the price difference.  A CFD is a financial instrument, which is a contract, typically between a broker and an investor, where one party agrees to pay the other the difference in the value of a security, between the opening and closing of the trade. You can either hold a long position (speculating that the price will rise) or a short position (speculating that the price will fall). This is considered a short-term investment as CFDs are used within shorter timeframes. For instance, to trade NEO CFDs, you can speculate on the NEO/USD pairing.
 
There are pivotal differences between buying a cryptocurrency and trading a CFD in a crypto market. When buying cryptocurrency, it is stored in a wallet, but when trading CFDs the product is stored in your account, which is regulated by a financial authority. You are more liquid when you purchase CFDs because you are not tied to the asset, you have merely purchased the underlying contract. As well as this CFDs are a more established and regulated financial product.
 

What is NEO? What is cryptocurrency?

NEO is the native cryptocurrency of the NEO network designed to be a decentralised application operating system, as well as to revolutionise the economy, in line with the founders goal of a ‘smart economy’. Cryptocurrencies can be split into either: utility tokens; providing access to the services provided by a particular project, security tokens; something representing an underlying asset, or a payment token (like bitcoin). A cryptocurrency is a digital asset conceived for use as a medium of exchange, which uses cryptography to secure transactions, control the supply of additional units, and corroborate transfers. In short, cryptocurrency is a decentralised electronic currency. Cryptocurrency is stored in a ‘wallet’, which can take various forms. For instance, Litecoin can be stored in an online wallet, or alternatively in an offline electronic wallet, and it can even be stored physically in hardware.

Why trade NEO CFDs with Capital.com

Advanced AI technology at its core: A Facebook-like News Feed provides users with personalised and unique content depending on their preferences. If a trader makes decisions based on biases, the innovative News Feed offers a range of materials to put him back on the right track. The neural network analyses in-app behaviour and recommends videos, articles, news to polish your investment strategy.

Trading on margin: Providing trading on margin (up to 2:1 for cryptocurrencies), Capital.com gives you access to the cryptocurrency market with the help of CFDs.

Trading the difference: When trading a NEO CFD, you don’t buy the underlying asset itself, meaning you are not tied to it. You only speculate on the rise or fall of the NEO price. CFD trading is nothing different from traditional trading in terms of strategies. A CFD investor can go short or long, set stop and limit losses and apply trading scenarios that align with his or her objectives.

All-round trading analysis: The browser-based platform allows traders to shape their own market analysis and forecasts with sleek technical indicators. Capital.com provides live market updates and various chart formats, available on desktop, iOS, and Android.

Focus on safety: Captal.com puts a special emphasis on safety. Licensed by the FCA and CySEC, it complies with all regulations and ensures that its clients’ data security comes first. The company allows to withdraw money 24/7 and keeps traders’ funds across segregated bank accounts.

History of NEO

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In 2014, the Chinese company Onchain launched the Antshares cryptocurrency and project, which goal was to create a platform that could move all economy deals into a virtual environment using smart contracts. The idea was that any real asset could be digitized with tokens, and be soled or exchanged. The Antshares project was popular in China and other Asian countries, and informally referred to as ‘Chinese Ethereum’. In 2017, Antshares was rebranded to NEO. In March 2018, Onchain distributed 1 ontology (ONT) token for every 5 NEO held in a user's wallet enabling the community to vote on system upgrades, identity verification, and other governance issues on the NEO platform.

 

FAQ

Before buying NEO, you will need a place to store it. This is what a wallet is for, and it consists of two elements: a private key and a public address. A wallet requires a private key, specific to the individual, that enables access to the NEO address stored in the wallet, which is also the public key. The wallet is what enables NEO, or any cryptocurrency, to be a secure medium of exchange. Essentially, people can send NEO, to certain wallets using the public key, which only the individual can access with their private key. Some individuals choose to keep their coins in their wallet provided by their cryptocurrency exchange, due to the fact that a lot of exchanges have mobile apps that allow people to easily buy, sell and spend cryptocurrencies.

Cryptocurrency exchanges or online wallets are far from immune to the dangers of cybertheft. The infamous case of the Mt Gox bitcoin exchange highlights this. Historically, Mt Gox was the largest global exchange for bitcoin, until it declared bankruptcy in 2014 after its security had been compromised. Mt Gox had 850,000 bitcoins, valued at $450 million in February 2014, before their exchange was emptied by hackers. It is believed that the private keys of Mt Gox’s digital wallet were stolen from as earlier as 2011. These risks are avoided when trading NEO CFDs because you do not need a wallet.

The 2018 crypto crash was the biggest sell-off of most cryptocurrencies in the history of the market. From 6 January to 6 February bitcoin fell about 65%. Consequently, nearly all other cryptocurrencies crashed. The cryptocurrency market capitalisation lost at least $342 billion in the first quarter of 2018. Bitcoin peaked at the $20,000 mark December 2017, with most other cryptocurrency peaking shortly after. There were several shocks let ultimately contributed to the cryptocrash: bitcoin price depreciated by about 12% after the Attorney General for the South Korea announced a move to ban crypto exchanges from issuing new trading accounts, later that month Coincheck (a Japanese bitcoin wallet and exchange service) was hacked and approximately 500 million NEM tokens (worth $530 million) were stolen, making this the largest crypto hack to have occurred.

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