Neo, the open-source, community-driven blockchain platform, revealed that development is underway on a new EVM-compatible sidechain that will enable developers “to deploy smart contracts, and open the Neo ecosystem up to a wide range of trading-specific use cases such as DeFi.”
As a separate blockchain with full interoperability with Neo N3 (Mainnet), Neo Sidechain inherits key Neo features, “including its robust dBFT consensus mechanism, resulting in faster transactions, improved scalability, and enhanced fairness.”
The Neo-VM multi-language development environment “enhances flexibility for developers to write smart contracts in their preferred language.”
The sidechain is purpose-built to “resist MEV attacks like frontrunning and sandwich attacks, creating a safer and improved trading environment.” The Sidechain also “retains important links to the Neo N3 (Mainnet) using Neo’s native GAS token for both governance and utility.”
The Neo Sidechain was unveiled “by Neo Founder, Da Hongfei during a keynote speech “at the grand finale of Neo’s 2023 APAC Hackathon in Hong Kong.”
Revealing the news of the project’s development for the first time, Hongfei said:
“It was 2014 when a group of us came together in Shanghai with a shared dream of reshaping the global economy using blockchain technology. Two years later in 2016 that dream gave birth to Neo and in 2018 we held the first Neo DevCon in San Francisco and welcomed developers from all over the world who shared our determination to build a top blockchain. In the 7 years since Neo was founded, we have weathered many ups and downs but we have always persevered and stayed true to our original vision of empowering people through innovation. Neo Sidechain is the next phase in the realization of that vision and a development that we know will welcome many new faces into the Neo community.”
In recent years, DeFi has emerged as “one of blockchain’s killer applications, but MEV attacks pose a significant threat to the sector’s future.”
This looks set to continue, with profit motives “driving more MEV extraction as the DeFi sector grows at pace.”
Many of these problems arise from “the fact that transaction details are publicly visible in the majority of Defi transactions, allowing bots and attackers to analyze transactions and exploit them. Sophisticated bots scan mempools and execute profitable arbitrage and liquidations, even reordering transactions so that they can be front run.”
The Neo Sidechain is specifically designed to “counteract these issues, boasting inbuilt functionality such as the ability to “envelop” transactions and deploy proxy contracts. By choosing to envelop a transaction, a user can encrypt the content of a transaction and its metadata and hide potentially sensitive information from attackers.”