The NEON token is super-hot. What about CowSwap’s COW?
Neon EVM is an exciting cross-chain solution with a smoking hot native token NEON. This platform allows dApp developers to access the advantages of Solana. As a result, they can expand their services and offer users new products, such as arbitrage or high-frequency trading. Furthermore, customers will be able to grow their user base, and decrease costs where possible, including gas fees. In addition, Neon offers full compatibility with Ethereum on Solana.
Solana blockchain has its own Berkeley Packet Filter virtual machine (also known as BPF virtual machine). The latter is used in the Linux kernel and developers have already tested it. The creators originally designed BPF bytecode for fast execution. Solana also supports just-in-time compilation for BPF bytecode. That significantly increases the speed of execution of BPF contracts. The creator team has written Neon EVM in Rust and compiled it to BPF bytecode. Thus, the company can now take full advantage of Solana’s functionality. That includes parallel execution of transactions, as well. Such a system will make it easy to update Neon EVM regardless of Solana’s hard forks.
What are Neon’s features?
The company offers many innovative features. They will give users great advantages. Neon EVM is an Ethereum Virtual Machine. Its compiled into the Berkeley Packet Filter bytecode of a virtual machine that is running on Solana. Any user who has an account in Neon EVM with a balance in ETH, or ERC20, and ERC721 tokens, will be able to use it. Moreover, the platform’s client can become an application that has an EVM (Vyper/Solidity/etc.) bytecode contract loaded into the Neon EVM on Solana.
On the other hand, a Neon EVM operator is any Solana account that pays for the execution of a transaction in SOL tokens and receives payment for that work from the Neon EVM user. The payment actually comes in a form of an arbitrary token specified by the user.
The platform also boasts a decentralized Neon EVM governance that manages Neon EVM work by setting up parameters and updating software. But it’s not free. It gets fees for its services. The team noted that they will add Neon Web3 Proxy. That is a tool that a Neon EVM operator can use to package a Neon transaction into a Solana transaction.
Moreover, Neon EVM has several functions, including uploading EVM contracts to individual Solana accounts; executing Neon transactions, if necessary, in an iterative manner, taking into account Solana resource constraints with the financial guarantees for completion of transactions; and checking signatures according to Ethereum rules on Solana.
What other services does the company provide?
Neon’s services include receiving a payment from the customer to the Neon EVM operator for the gas consumed and fees in any ERC-20 token or any ETH specified by the user; calculating gas consumption according to Ethereum rules; storing EVM data of contracts in the form of a hash table using the Hash Array Mapped Trie algorithm (also called HAMT); and calculating and withdrawing fees in SOL tokens to the governance pool of Neon EVM from the operator account for execution of transactions.
In addition, Neon Web3 Proxy will provide a Web3 API to access the Solana blockchain. The latter is an intermediary for communication between the platform’s clients and Neon EVM. Operators can easily run it. However, Neon Web3 Proxy is optional for any client. Its main goal is to help them start using Neon EVM without any changes to their codebase.
The company will deploy an ERC20 SPL-Wrapper contract for each Solana token. Its task is to ensure the interaction of the Solana applications with EVM bytecode contracts. Customers can also use ERC20 SPL-Wrapper to transfer funds in Solana tokens by using Ethereum wallets such as Metamask.
Neon stated that it ensures the independence of its operations by providing open access to its infrastructure to any user who is willing and capable of running Neon Web3 Proxy. But this economy is fee-based. Its native NEON coin is also a governance token.
CoW Protocol’s token is also very high-ranked. Why’s that?
CoW Protocol is a fully permissionless trading protocol. It leverages Batch Auctions as its price-finding mechanism. Moreover, this platform enables batch auctions to maximize liquidity via Coincidence of Wants (CoWs), as well as allowing users to tap into all available on-chain liquidity whenever needed.
The protocol is continuously running Batch Auctions. The solvers, the parties in charge of finding the most optimal settlement for the batch, compete to settle it. The winning solver will be able to maximize traders’ surplus by either finding the best liquidity sources, having the most optimal CoW, or combining both in a single settlement.
According to the team, Coincidence of Wants (CoWs) is one of the most innovative aspects of this protocol. They are settlements sharing liquidity across all orders who have matching limit prices. Instead of an AMM or a CLOB, the CoW protocol decided to use batch auctions as a core mechanism to facilitate CoWs. That leads to better prices for the individual traders as well as offering big savings, in terms of liquidity provider fees and gas fees optimization.
In addition, Batch Auction uniform clearing prices and CoWs don’t need access to on-chain liquidity. Thus, the CoW protocol will be able to offer the user a level of MEV protection that users can’t achieve by any other protocol.
What makes this platform stand out?
CowSwap is the first trading interface that the team has built on top of the CoW protocol. It acts as a Meta DEX aggregator, giving the customers the best price across the aggregators or AMMs depending on which one is the most liquid venue for the investors within a batch.
Furthermore, the CoW protocol uses a “party” called a solver. The latter is the party in charge of providing the settlement solution to the batch auctions. Solvers will compete against each other to submit the most optimal batch settlement solution. Each time a solver will submit a successful batch settlement solution, the protocol will reward them with tokens. That means the protocol will reward solvers for solving the batch auction optimization problem. According to the company, anyone will be able to become a solver.