VOC Explained

What Is VeChain (VET)?

Adekunle Joshua

In the cryptocurrency world, there are many innovations made regularly with special features and tools. One such latest innovation is VeChain.

VeChain which began in 2015 brought a new technological upgradation in the supply chain among the big companies. It also launched its own new tokens and tools. If you are curious to know more about this new company and how it impacted, the supply market, here is an explainer on the same.

VeChain is a blockchain platform that provides a full view of any organization or group by disintermediating the information from available data. The main aim of VeChain is to build a trust-free environment and distributed ecosystem to enable transparent information flow, efficient collaboration and easy, fast transfer of values.

It gives businesses a better digital collaboration between them by giving them new tools for easy and great efficient data transfer and supply-chain management.

Some of the popular companies using the VeChain blockchain are BMW, Walmart and LVMH.

Besides the supply chain management,  VeChain boasts two native cryptocurrencies, including VET coins and VTHOR. The former deals with voting changes to the protocol and the latter is for executing transactions.

Another goal of VeChain is to become a leader in decentralized applications (DApps), initial coin offerings (ICO) and being the middleman for the Internet of Things (IoT).

It smoothes out supply chain issues, and easing information management for business is the main goal of the VeChain platform. The key to VeChain's mission is smart chips that are mainly used to track the entire operations of the supply chain flow.

VeChain uses the method of Proof of Authority (PoA) consensus protocol. Under this, identity is used as a stake to validate transactions and approve or validate new block transactions.

Validators are compensated for their work based on their reputation; therefore, they are incentivized to keep the transaction going to keep up their good name. It is not possible to remain anonymous, and revealing one's identity is a must for VET holders who want to work as validators.

PoA has relatively quick transaction speeds because it is less energy-intensive than other consensus techniques, such as Proof of Work (PoW), and it does not require a minimum number of validators to reach consensus.

Additionally, VeChain also uses two token design models. Under this, it uses two native tokens VET and VTHO, as explained before. This design helps manage the price volatility of VET coins and the additional costs of computation.

Miners receive VTHO fees for computations carried out by the network, much similar to how the Ethereum blockchain uses ETH and gas. A particular programme will need more VTHO as the computation becomes more complicated.

Finally, nodes staking VET money get paid with VTHO for every block and can vote on network enhancements.

Founded in 2015 by Sunny Lu, the former chief information officer of Louis Vuitton China. It was first a subsidiary of Bitse, one of China's largest blockchain companies. It was one of the few companies to actually start with an already established customer base among others.

The VeChain team first distributed its cryptocurrency, VEN, on the Ethereum blockchain in 2017. These tokens were further replaced by VET tokens when the VeChainThor blockchain was launched a year later.

The white paper for the VeChain blockchain platform outlines its main goals. Through data transparency, VeChain plans to disrupt the supply chain industry and make the business more transparent and customer friendly. VeChain has also formed strategic alliances with a number of other companies over the years to help this goal.

To buy VeChain cryptocurrency or token, you can choose any cryptocurrency exchange platform and then continue with the trade and storage of tokens. Alternatively, you can also keep the token in the exchange wallet. It also has a special feature called Thor wallet, which is specifically designed for its own tokens and available for both Android and iOS devices.

One such popular platform to buy VeChain is Binance. Here, first, you need to make your account and verify your identity. Users can register via the website or using phone or email. You can click on buy the crypto link and start with the order. Confirm the purchase based on the current market price and then take it and use it. You can either hold VET coins in your Binance account or keep them in your wallet to stake and use later.

VeChain is not minable and completely runs on a proof-of-authority method where the largest participants act as network validators. Another way is to invest in VeChain. Under this, you can buy the token and support the exchange in the decentralized market. It is one of the top 25 cryptocurrencies.  However, during the transaction one main thing is to have enough money in the wallet. The transactions cost around $7.

Its main feature enables enterprises to track supply chain operators for big companies. This feature makes it suitable for creating NFTs and linking digital with physical products by applying NFC and IoT technology. This is especially for B2B companies only. VeChains are thriving even in the NFTs market.

There is a decentralized NFT marketplace called VeSea, where users can create and trade VIP-181 tokens that are stored on the VeChain network. The VIP-181 Standard, which the VeChain Foundation introduced, offers basic functionality for tokens in smart contracts.

Users cannot sell, buy, or store NFTs on VeSea without a VeChain compatible wallet, which includes VeChain Sync2 and VeChainThor Wallet. VeSea also doesn't need to pay for gas because of the efficiency of the underlying blockchain. Users must, however, pay a 2.5% trading fee.

Additionally, there are NFT collectible projects and markets built on VeChain that we are used to seeing in web3 culture.

VeeKings, Metaversials, Doppelganger, and Shredderz are a few of the VeChain collections that have received media attention. Metatun and Satoshi Dice are two VeChain-based play-to-earn games that are worth highlighting.

VeSea is the most well-known NFT marketplace on VeChain. You require a VeChain-compatible wallet in order to purchase, sell, and store NFTs on VeSea. VeSea is compatible with VeChain Sync2 and VeChainThor Wallet. Additionally, because of the effectiveness of the underlying blockchain, VeSea has no gas expenses. There is a 2.5% trading fee, though.

Another VeChain NFT marketplace includes World of V and Vechian.tools. Both are zero-fee platforms. The NFTs of VeChain are regularly updated and introduce new offers, rewards and projects. It needs to be tracked regularly.

The VeChain whitepaper, which was released this year after upgradation, said that it believes "blockchain technology is one of the foundations for the next generation of information technology, alongside emerging technologies such as AR, VR, AI, IoT, 5G and more.

VeChain's vision of lowering the problems and barriers in the trade. It enables established businesses with blockchain technology to create value.

VeChain seeks to speed up the widespread adoption of blockchain technology by tackling problems like the high maintenance costs associated with an Ethereum-based DApp. Despite VeChain's application cases in supply chain management and other sectors, a person's financial goals and risk-return profile determine the type of investment they make.

Nevertheless, it might be hazardous to invest in a cryptocurrency that you believe requires more assurance; you run the risk of losing your hard-earned cash. In light of this, base your choices on the allocation of your assets on the returns you anticipate from your investments.

However, VeChain network is secure with many security companies and technology involved. It finds potential vulnerabilities constantly and treats cyber threats to protect your investment.

The Future of VeChain

The VeChain ecosystem is developed and governed by the VeCahin foundation based in Singapore. VeChain is now gaining popularity in the market. Though Vechain looks to have a great application in logistics, supply chain management and other industrial support, there is a need to maintain the risk-tackling element.

According to experts, a projection of between $0.0533 and $0.063 is very probable based on the current price trend. For most of 2022, the token's price has remained at $0.0388. The macro- and microeconomics of the wider crypto market also influence whether the price rises.

However, according to the experts, if everything goes according to plan, the price might shatter the $0.040 barrier as early as January 2023. At the very least, in June 2023 or October 2023, the cryptocurrency price is anticipated to surpass $0.050.

The future of any cryptocurrency, including VeChain is uncertain. It cannot be predicted if Vechain can replace Ethereum in the years to come. But, there is a need to track the movement of the currency constantly. The money value and investment price will grow next year due to more awareness and available options. It will be new and exciting to see how Vechain will compete with its rivals and new emerging coins in the market with a new competitive edge and strategy.