21 March 2018

Neon Exchange (NEX) ICO Review – NEO Decentralized Exchange

Summary

  • Project Name: Neon Exchange
  • Token Symbol: NEX
  • Hard Cap: $25,000,000
  • Conversion Rate: 1 NEX = $1.00
  • Total tokens issued: 50 million token and 25 million for sale
  • Bonus Structure: N.A
  • NEP-5 Token : Yes
  • Whitelist:  Whitelist period started from 12th March until 30th March 2018
  • Blockchain platform: NEO's NEP5 token
  • Token Distribution Date: TBA ( To Be Announced )

Video Summary (video is 05:20 long):

Project Overview

  • NEX is a combination of the NEO blockchain with an off-chain matching engine which enables much faster and more complex trades than existing decentralized exchanges. It will be first DEX supporting NEO’s NEP5 tokens.
  • NEX focuses to combine the performance of existing centralized exchanges with the security and trust properties of a decentralized exchange.
  • The advance safety features hopes to bring in high trading volume and with the help of AME (Automatic Matching Engine), it will help reduce arbitrage opportunities and allow more complex trades like market and limit orders.
  • It makes use of NEO Block chain and it will be launched exclusively within NEO initially, but with time the platform will be expanded to support exchange within the ETH blockchain as well.
  • Further increasing the security to grant ease of access, NEX will have users store their private keys client-side (in a web browser via extension). This will allow users to login and interact with the NEX platform without uploading their private keys.

Three Core Components and Advantage Over Other DEX

  1. Off-chain Matching Engine

    NEX will make us of an “off-chain relay” which will help match trades using a side-chain smart contract and than execute them “on-chain”. The user will authorise an order for exchange of token A for token B and sends it to the automatic matching centre on the other hand another user authorises an order for exchange of token B for token A. The matching engine will then match the order and submit the smart contract for execution. This will increase the number of transaction which can go up-to 100000 trades/ second.

  2. Smart Contract for Token Exchange

    NEX makes use of special smart contracts that are used to “perform trades between users”. The contracts make use of program data that is powered by NEP-5 token protocols. Through their use, system performance can be enhanced, and overall trade efficiency can be increased dramatically.

  3. Payment Service

    NEX will enable exchange of global assets such as NEO and GAS in place for tokens that are compatible with smart contacts.

Roadmap

  • Q1 2018: Open source platform for token sales on NEO will be released.
  • Q2 2018: Payment service for both NEO and GAS will be launched on MianNet. Matching engine will launched on Testnet which will be supported by CLI. MainNet will also feature Smart wallet and API launch.
  • Q3 2018: Trading interface and matching engine launch on MainNet. Cross-Chain demo for NEO and ETH on TestNet will be launched too.
  • Q4 2018: Cross-chain trading to support trading of ETH and ERC20 tokens to be launched. Support for margin trading to be launched.
  • 2019+: A decentralized banking services, which will provide present day banking and services. Primarily the same will be done through the use of smart contracts with the logic of those services built in.

Tokenomics

From the 50 million total tokens, 50% of the tokens i.e. 25 million token will be sold to public. 20% will be locked in a smart contract with the founders with slow release over 2 years. 15% will be with Neo council, 10% are allocated to future partnerships, 4% to company fund and r1% will be given as ESOP’s.

Fees and Appreciations

  • Fees are calculated in terms of each asset traded or transferred on NEX.
  • For example, if a user places a market price order trading 1000 NEX for NEO, then the exchange will collect a fee of 1000 ∗ 0.0025 = 2.5 NEX. Total NEX fees are calculated by simply computing the fees taken for each asset on the exchange.

    NEX Initial Fee Structure
    User 30 Days Volume Taker Fee Maker Fee
    0% 0.25% 0%
    1% 0.22% 0%
    2.5% 0.19% 0%
    5% 0.19% 0%
    10% 0.16% 0%
    20% 0.13% 0%
  • Claiming Fees via Staking NEX Tokens
    To stake NEX tokens, users send their NEX tokens to the smart contract via a stake method that records the starting block and the amount sent by the user. The user can then make periodic claims on the contract to retrieve their share of NEX profits since staking began.
  • The user claims a direct cut of fees across each token on the exchange, so if NEX is trading NEO, GAS, NEX, and RPX, the user would receive a share of each of these assets.
  • So more the trading volumes and more the payout, more the valuation of NEX and hence the appreciation of token value.

Team

  • Fabio C. Canesin: Co-Founder and Developer
  • Fabian Wahle: Co-founder and Developer 
  • Ethan Fast: Co-founder and Developer
  • Luciano Engel: Co-founder and Developer
  • Thomas Saunders: Co-founder and Developer
  • Nathaniel Walpole: Designer
  • Samuel J. Mansfield: Designer
  • David Schwartz: Developer
  • Evgeny Boxer: Developer
  • Carla F. de Paiva: Marketing and Public Relations
  • Da Hongfei: Advisor
  • Erik Zhang: Advisor

Opportunities

  • NEX will be the first exchange to utilize NEO, NEO Gas and its own NEX token as base pairs to trade NEP-5 tokens.)
  • The NEX wallet extension is planned for release before the ICO which will provide a much anticipated alternative to the Neon Wallet.
  • One key advantage to the wallet extension is that NEX users will not have to worry about transferring their NEP-5 tokens on and off of the platform.
  • NEX is going to implement its decentralized banking platform, allowing users to use fiat to directly purchase NEP-5 tokens.
  • A strong team and NEO council support makes this ICO highly anticipating.
  • Purchasing NEP-5 tokens with fiat, storing them safely and trading on a decentralized platform are all elements that comprise the vision of the NEX ICO project.

Concerns

  • The crypto space is due for a number of decentralized exchanges in 2018, and NEX will have to contend with the competition.
  • By the time integration with ERC20 tokens comes around, having an established niche in the DEX playing field could well work toward the favor of NEX but remains a large uncertainty at this point

Conclusion

  • The NEX ICO signifies a massive step forward in the development of the NEO Smart Economy.
  • The advances NEX offers to the NEP-5 token ecosystem are impressive and the team behind the project have a track record to be reckoned with the project.
  • The introduction of NEO based trading pairs, improved wallet function, ICO launch platform and decentralized banking all represent a significant milestone in the development of the crypto space as a whole.
  • Also looking at the team, the token is set to have unmet demand during the crowd sale.
  • Talking about long term potential, DEX enjoy high valuation (Idex and Bancor) and there are high chances of NEX to succeed with the support of NEO council.
  • Flipping: Good and Positive
  • Long Term: Good and Positive (Provided 10 million+ trade volumes)

Nex Passive Income Calculator (As Per Whitepaper)

Nex Exchange Passive Income
Daily volume 5 Million 5000000
Daily revenue @0.20 % 10000
365 days revenue 3650000
Maximum Circulation Supply Nex 50,000,000
Staked Percentage 75% 75%
1000 Nex staked fees earned P.A. 54.75
Nex Exchange Passive Income
Daily volume 10 Million 10000000
Daily revenue @0.20 % 20000
365 days revenue 7300000
Maximum Circulation Supply Nex 50,000,000
Staked Percentage 75% 75%
1000 Nex staked fees earned P.A. 109.5