VeChain is a cryptocurrency network focused on supply chain and logistics needs. The VeChainThor blockchain—the public blockchain behind VeChain—runs the VeChain token (VET) and the VeThor token (VTHO). The VeChain token is used to transfer value across the network, while the VeThor token is used as energy to power smart contract transactions.
- VeChain is a cryptocurrency and software that works as part of the VeChainThor blockchain, supporting two unique cryptocurrencies and smart contracts.
- Consumers can scan codes to get data on the source and authenticity of the product.
- Consensus is needed to ensure that all participants in the network agree on the current state of the blockchain.
- Most of the apps that can use the VeChain platform rely on this layer for functionality.
- Its initial target was to disrupt the supply chain industry by making data actionable and transparent.
- While the consequences were more or less mitigated, it certainly cast a serious doubt on the degree of decentralization of the platform.
In both of these industries, it may be critical to know if a product is safely sourced and stored through various owners and facilities. VeChain is also useful for anti-counterfeiting, digital vehicle passports, or any open financial transaction. Of the two tokens from the VeChainThor blockchain, VeChain is the larger, more influential digital token.
For example, the VET blockchain allows Proof of Work (PoW) to be conducted for every transaction. This means that the people conducting a transaction can mine more VTHO if their initial estimate was wrong. VeChain transitioned onto its own blockchain and rebranded itself in 2018.
How to Invest in VeChain
They run when predetermined conditions are met, and can automate workflow, triggering the next necessary action when the conditions are met. Using the smart contract features of VeChain, users can track ownership and control of any number of goods. For example, an electronics manufacturer can track the process of products to distribution using VeChain. The highly regulated marijuana industry, for example, could use VeChain to track seeds, plants, sellable products, and sales for end-to-end compliance requirements. The VeChainThor blockchain uses Proof of Authority as a consensus protocol. Per this protocol, votes are disbursed based on VET holdings and disclosure.
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History of VeChain
Unlike other businesses, like centralized exchanges, which relied on cryptocurrencies, that got banned there, VeChain’s position is pretty secure. In fact, they are working with the local government of Inner Mongolia, as previously mentioned. However, as all Authority Masternodes have their identities and reputations at stake, they are all held accountable and are incentivised to work in the best interest for the networks growth and security. Authorithy Masternode’s also earn rewards for producing blocks, which further incentivises them to act in good faith and to the benefit of the VechainThor blockchain. VechainThor is the layer 1 blockchain which powers the vechain ecosystem. Per VeChain’s white paper, the two-token system was devised for effective governance and to have a predictable economic model for decentralized applications developers.
That means a smaller number of computers do the work to validate and operate the VeChain network. For individuals, it means you are unlikely to have an opportunity to mine VeChain. The main features that set VeChain apart are its use cases for tracking goods and data. Businesses that require a verified chain of ownership through production, shipping, or other processes could use VeChain for that purpose. In its current form, Ethereum lacks such a model because the price of ether, its native gas token, is volatile.
VeChain is different from other supply chain blockchain platforms in that it utilizes cryptocurrencies. Instead of one coin, VeChain Thor uses two different native tokens, VET and VTHO. Holding VET generates VTHO, a gas token which is used for paying the transaction fees. Separating main and gas tokens helps to keep transaction fees resistant to volatility. The unique consensus mechanism that VeChainThor uses is called Proof-of-Authority (PoA), which is a spin on Proof-of-Stake. The chain is secured by masternodes which passed “know-your-customer\business” authorization.
In essence, Buterin asserted peer-to-peer (P2P) decentralised networks cannot score highly on decentralisation, security and speed. Every blockchain network will be required to sacrifice one attribute to achieve the desired blockchain configuration. Vechain’s aim is to be an enterprise grade, sustainable blockchain, and so the tradeoff was to reduce the amount of actors involved in block production in order to improve speed and security. In April 2021, the VeChain network voted to lower fees, a good sign for those looking to use VeChain as a currency or smart contract platform. This is part of the VeVote system, where users can vote on future changes and upgrades to the network. In its simplest terms, smart contracts are programs stored on a blockchain.
This means that, unlike the energy-intensive, proof-of-work system used by Ethereum (and Bitcoin), VeChain uses a proof-of-authority strategy to enable an efficient network that uses relatively little electricity. VeChain is a cryptocurrency and software that works as part bitcoin trademark and domain sold of the VeChainThor blockchain, supporting two unique cryptocurrencies and smart contracts. VeChain is particularly useful for logistics and tracking, potentially leading to interest among the shipping, retail, manufacturing, warehouse, grocery, and other industries.
Exchanges with VeChain support include Binance, Crypto.com, and Bitfinex, among many others. If you want to buy and own VeChain, you have several options for exchanges and wallets. As a top-25 cryptocurrency, VeChain is widely supported and easy to buy through many major cryptocurrency exchanges. In addition to the official VeChain wallet, you can store your VeChain in a hardware wallet like Ledger. The VeChain whitepaper offers potential use cases in both the food and pharmaceutical industries.
VechainThor is packed with technical features that are tailor made to meet the needs of individuals and enterprises. Since it went live, the time when the genesis block was mined, in June 2018, the blockchain has been 100% online with zero downtime. VechainThor is an extremely fast and efficient blockchain, producing blocks, on average, every 10 seconds and all the while only consuming a fraction of the energy other blockchains require to complete the same task. In fact, vechain’s energy consumption is equal to just 0.04% of other blockchains.
VeChain officially launched in 2015 under the leadership of a Shanghai-based team following about a year of development. It’s now run by a team of more than 100 workers globally, offering blockchain-as-a-service (BaaS) products to customers in the logistics and data management industries. The system of master nodes centralizes voting rights in a decentralized system. But the founders of VeChain have said that their aim in designing this protocol is to achieve a balance between centralization and decentralization. The VTHO token stands for VeChainThor Energy and is also known as VeThor Energy.
As of this writing, the market capitalization of VeChain is $8.3 billion, making it the 23rd largest cryptocurrency. VeThor has a $358 million market cap and ranks as the 169th largest digital currency. The application of sensors means that all parameters related to the product the dangers of investing in cryptocurrencies can be constantly monitored and problems, if any, can be communicated back to the relevant stakeholders. Manufacturers and customers are informed if a drug packet is stored outside a prescribed temperature range, allowing for service improvements and better quality control.
The validators do not compete with each other for a chance to mine a block, they are assigned at random. Authority Masternodes are responsible for maintaining the blockchain and producing blocks. Any user can run an Economic Node for voting rights and occasional rewards from the VeChain foundation. There is Waltonchain which itself is an Ethereum token, so on that platform the transactions and actual tracking are separate. The latter is more focused on the IoT use case so its structure is not of a blockchain but a decentralized network. VeChain is a blockchain platform designed to enhance supply chain management and business processes.
At the very end of 2021, VeChain news reported a new strategic partnership with Schneider Electric. Like in other open-source (and partially open-source) blockchain platforms, developers submit how are your cryptoassets taxed improvement proposals for review and implementation. With VeUSD, the first USD-pegged stablecoin on VeChain Thor, the scope of use cases is set to expand into decentralized finance.
