Neo co-founder Erik Zhang has detailed a series of protocol-level updates spanning the Neo N3 and the upcoming Neo 4, focused on transaction fee control and native token infrastructure.
Whitelist contract costs
Neo’s core developers have completed development of a Contract Fee Whitelist for Neo N3, with the feature now being tested and ported to Neo 4. The mechanism allows selected smart contracts to operate under alternative fee rules, defined at the protocol level.
Whitelisted contracts use a fixed-rate GAS model, allowing for predictable and stable execution costs. For Neo 4, the design goes further and introduces a zero-cost execution mode for critical on-chain infrastructure. This applies to use cases such as stablecoins and identity systems, where transactions can be performed without GAS fees at the protocol level.
Control of the whitelist is assigned to the Neo Council through the native PolicyContract, allowing the board to determine which contracts are eligible.
TokenManagement own contract
Zhang also announced the addition of TokenManagement, a new native contract designed to unify the token infrastructure on Neo. The contract provides a shared foundation for both fungible and non-fungible tokens, replacing the need for projects to implement token logic independently. The NEO and GAS native contracts will also be adjusted to use the new management contract.
TokenManagement supports NEP-17 style fungible tokens and NFTs using the same underlying primitives, including deterministic asset identity, shared accounting logic, unified storage, and standardized events and callbacks.
By consolidating these components at the protocol level, Neo aims to reduce code duplication and improve token security across the ecosystem.
Protected token callbacks
As part of the TokenManagement rollout, Neo has added virtual machine level enforcement for token callbacks. Methods such as onPayment, onNFTPayment, onTransferAnd onNFTTransfer can now only be invoked by native contracts.
This change prevents spoofed callback calls, spoofed token interactions, and a class of reentrance and logic spoofing attacks. Token callback protection is enforced directly by the VM rather than relying on developer convention.
Anchor primitives at the protocol level
According to Zhang, TokenManagement reflects a broader shift in Neo’s design philosophy. The core mechanisms are moved to controlled native contracts, allowing application developers to focus on higher-level logic rather than low-level accounting or implementation details.
Neo positions this approach as a basis for further improving security in the chain while simultaneously improving the maintainability of the protocol in the long term.
The announcements can be found on Zhang’s X page:
https://x.com/neoerikzhang