After all the news that has come out about Ontology there has been a number of people starting to get worried Ontology is going to take over what NEO was supposed to do. In this first post I want to explain why this is not the case, and in what way NEO and Ontology compliment each other and in a way will need each other to get bigger and stronger.
In this post I will be explaining:
- The similarities between NEO and Ontology
- The fundamental differences between NEO and Ontology
- Why NEO and Ontology want to and should work together
Similarities between NEO and Ontology
1. Token system
So just this week Ontology released info on their token system:
It looks an awful lot like NEO’s token system. Technically it’s pretty much the same, only there wil be 10 times as many ONT tokens as NEO tokens (1 billion instead of 100 million), but both generate GAS (NEO GAS for NEO and Ontology GAS for Ontology) at the same rate. The block generation rate is also pretty much the same at 15-20 seconds.
2. Both systems support the development of dApps
As we all know NEO is an infrastructure platform for development of dApps. Ontology is no different and in a way they are built to do the same thing. I think a big part of the confusion is coming from here. If both NEO and Ontology are supporting development of dApps, why would anyone choose NEO over Ontology when Ontology is a private run blockchain? Ontology has a much bigger chance to work with the government or big companies because they would rather work on something private than a soon-to-be decentralized platform with influence from the community like NEO, right? Please keep on reading..
3. Both systems are backed by the private company Onchain
Both NEO and Ontology are being provided technical support by Onchain. Both founders Da Hongfei of NEO and Jun Li of Ontology are co-founders of Onchain. They work closely together and in my opinion this is a good thing, this way they can take the best of both systems and make it work together smoothly. I would think both founders of NEO and Ontology want both systems to succeed and not one or the other.
Fundamental differences between NEO and Ontology
1. NEO public chain vs. Ontology public chain
NEO is a public blockchain, everyone can access and work with the data. Ontology itself is also a public blockchain, but is aiming to make separate blockchains for businesses that can securely store their data without everyone accessing and viewing them. They can connect them to other blockchains to share certain parts of data. So Ontology and NEO are fundamentally different in their use cases.
2. The focus of NEO and focus of Ontology is different
This is the most important part to me. Even though both platforms are made for dApp development and smart contracts, NEO and Ontology both serve a different purpose. Like I explained above NEO’s focus is public, Ontology’s focus is private. NEO’s vision is to create a Smart Economy, they are a public blockchain focusing on digital assets and publicly developed dApps. Ontology Network is also a public blockchain but made to create seperate secure blockchains for existing businesses and connect blockchains to each other, and this is the key difference to NEO.
Why NEO and Ontology want to and should work together
Here we come to the conclusion of why NEO and Ontology are not competitors but mutually benificial, and maybe even a necessary existence for each other. Please see below chart that I made on NEO’s smart economy. This is just a basic chart, but it shows how the whole system works together and is connected to NEO. I will go into depth on Ontology and NEO’s collaboration below, also bringing in the TheKEY project.
Ontology’s trust system for businesses
No business will trust their data to a public community project like NEO. This is where Ontology comes in. As explained Ontology will create blockchains for businesses. As in above illustration, say Company X wants to enhance their business with the possibilities of blockchain, say connecting a customer’s data access to their customer’s identity. I don’t think there are a lot of big companies that would trust a decentralized and public run project like NEO with their sensitive data.
Ontology will create a secure blockchain for Company X. Company X can safely store their data on there because it is only for them and it’s not public. But, Ontology can connect Company X’s blockchain through the Ontology Network to NEO so it still has all the benefits of NEO’s platform and all other services it offers.
TheKEY project is an identity database system on the blockchain which is built on NEO and will work with Ontology. TheKEY can be the one that connects the identity of customers of Company X to Ontology and NEO and gives them access to data stored on Company X’s private blockchain or even data or assets stored on NEO’s public blockchain if Company X wants to make that connection. This is just a very basic example, but as you can see Ontology is going to make a huge difference and will give a huge boost to the usage of NEO as a platform. Company X could be any company from a bank to a company like Amazon or Alibaba, the use cases for Ontology are unlimited and who knows what the future will bring..
Ontology will make use of NEO
Ontology will use NEO and NEO GAS for different business scenarios, this is confirmed by the Ontology team. Also, Ontology has said that when businesses that run on Ontology need to perform a token sale for their private blockchain, NEO can provide the token system. You see that even though Ontology has their own system with Ontology GAS, NEO and NEO GAS will be used as well.
Ontology needs NEO, NEO benefits from Ontology
Though I say Ontology makes use of NEO, it is nothing without NEO really. Ontology needs NEO and NEO’s Smart Economy including projects like TheKEY to offer something to their customers. A business who can plug into NEO through Ontology with a trusted system, safe and fast transactions and a whole bunch of services and options to work with, is a happy business. I think that without NEO and all that it does businesses won’t necessarily choose Ontology to work with. Ontology is not that special in itself and it doesn’t have that much to offer really unless it taps in to NEO’s Smart Economy.
At the same time, NEO in itself is limited in it’s reach. As we discussed NEO doesn’t have the trust system behind it to pull actual businesses on board and use NEO’s system. With Ontology by it’s side, it will be able to do this, and NEO will hugely benefit from this. In the end, having ICO’s and some smart contracts is really cool and NEO can do a lot, but only by getting in touch with real world businesses NEO can unleash it’s real potential and fulfil it’s vision of a Smart Economy.
Though this article doesn’t explain everything because not all information on Ontology is published fully yet, I think we are safe to say that Ontology is not posing a threat to NEO. Rather, it will complete NEO’s Smart Economy vision by being the bridge between NEO and big businesses and who knows one day even governments. In my opinion there is a symbiosis between NEO and Ontology. They are of mutual benefit to each other and I’m sure we will see this unfold in 2018. With any new update from Ontology I will try to add more info to complete the whole picture!