VeChain Price (VET)

VeChain – What it is, How it Works, Blockchain Applications, and More

Because of the capabilities of blockchain technology – including automation, immutability, transparency, and decentralization – a number of proven use cases have emerged for not only individuals, but businesses as well.

By adopting distributed ledgers, some projects have managed to lower prior barriers of entry for enterprises. As a blockchain platform that was intended to improve the overall blockchain technology on a wider scale, VeChain has become a major player in the market.

With billions of tokens in circulation today, VeChain price prediction is estimated in much the same way as Bitcoin, Ethereum, and other major cryptocurrencies. In this guide, you will learn about the history of VeChain, its functionality, and how it is becoming a relevant option for business enterprise.

What is VeChain (VET)?

VeChain is a public blockchain which has since been rebranded as VeChainThor. It was created with wide use in mind and adoption of general blockchain technology by organizations of all scope and size. VeChain is meant to act as a foundational brick for a resilient, expandable blockchain ecosystem.

Initially, VeChain was part of the Ethereum blockchain. Since then, VeChain has become its own native blockchain. It maintains that Ethereum is no longer suitable as a means for running large, commercial-scale decentralized applications (dApps). VeChain believes that Ethereum doesn’t have the robust framework for governance required to provide transparent, fast protocol changes meant to handle large-scale or emerging issues.

VeChain also addresses the lack of a proper economic model within the Ethereum blockchain. They believe that businesses are restricted from operating their Dapps at a controllable, predictable cost. The hope of VeChain is to tackle these issues through a proof-of-authority consensus method, a unique two-token system, an on-chain governance mechanism, and meta-transaction features.

Who are the Founders of VeChain (VET)?

VeChain is the creation of Sunny Lu, the former chief information officer (CIO) for Louis Vitton. He founded the company in 2015 as a subsidiary of Bitse, one of the largest blockchain companies in China. VeChain is also one of the only blockchains with a notable customer base, especially among those companies that are most established.

Upon its creation, VeChain initially took aim at the enterprise market. The goal was to attempt to disrupt the supply chain industry by reaching for far more transparent and actionable data. Since then, it has redirected its direction to include more than just an ecosystem for supply chain. It is also giving developers the chance to create cryptocurrencies and tokens, Dapps, mechanisms that can be used for the Internet of Things (IoT), and more. It is also targeting both businesses and people that have the goal of improved sustainability and a greater global economy.

How VeChain Works

In order to fully grasp the VeChain blockchain, let’s walk through how it works using supply chain management:

Unique Identification Creation

Each product or batch is given a unique identification number. It could be a radio-frequency identification (RFID) tag, near-field communication (NFC) chip, or a quick response (QR) code. These identifiers are crucial for tracking the progress of a product on the supply chain.

Data Recording and Capture

Data is recorded throughout each stage of the supply chain. Relevant data includes batch numbers, storage circumstances, manufacturing process details, expiration dates, transit information and more. From there, the information is stored on the VeChain blockchain.

Blockchain Entry

All of that captured data is then stored on the blockchain. Each record is time-stamped and then connected to the record before it, which forms a transparent and unchangeable chain of records.

Activation of Smart Contracts

Smart contracts within the blockchain are pre-written agreements. These agreements take place automatically when certain requirements are met. It could mean notifying stakeholders when a product reaches a certain location, releasing payments, or automatically updating product status.

Verification and Tracking in Real-Time, Updates, and More

All parties involved in the supply chain are provided real-time tracking and verification. This can include distributors, customers, suppliers, manufacturers, and retailers. The record on the blockchain is updated as long as it moves through the lifecycle. As this happens, data is not only updated but auditable for quality assurance, compliance, and more.

How Many VeChain (VET) Coins are There in Circulation?

VeChain is one of the few coins where its entire max supply has already been released into circulation. The circulating supply of VeChain (VET) is 85,985,041,177. At just under 86 billion tokens, the entire supply is available for trading and use on the VeChain ecosystem.

How is the VeChain (VET) Network Secured?

VeChain has meta-transaction features for enterprise applications. They help make the development process more user-friendly through a number of means. First is multi-payment party use. The freemium model is enabled through a flexible transaction fee delegation scheme that makes onboarding smoother. This allows an enterprise to have a smart contract and designate a gas account in order to manage the gas fee required for network use.

Users are also able to set dependencies that stop transactions from being executed until the processing of the relevant transaction. This process ensures that business needs are met by the execution order.

Multi-task transaction developments are interesting as well. Developers are able to batch payments, control the order of calls through atomic transactions, and include a variety of calls to various contract functions all in a single transaction.

Finally, there is the controllable transaction lifecycle. Users are able to set their own time for when the transaction expires or is executed if it isn’t already included in a block using BlockRef and Expiration transaction fields.

The VeChain Blockchain

At its launch, VeChain’s token VEN functioned within the Ethereum blockchain. It has since moved to its own blockchain and went through a rebrand in 2018. The biggest part of the rebrand saw the VEN blockchain become known as the VeChainThor (VET) blockchain.

The new VeChainThor blockchain makes use of a proof-of-authority consensus algorithm. This algorithm is called proof-of-authenticity within the VeChainThor blockchain. This method of consensus uses what are called Authority Masternodes (AMs). These AMs are chosen after going through a vetting process that information like the hosters’ identies are verified for trustworthiness while a financial investment is used for staking.

It is important to note that anonymous nodes aren’t allowed within the VeChainThor blockchain. Disclosure of identity is essential to becoming one of the Authority Master nodes. In a white paper published by VeChain, the system doesn’t require a minimum number of validators and uses less power in order to reach a consensus.

Additional Nodes on VeChain

The AMs aren’t the only nodes on this blockchain. There are other types of master nodes that exist within the VeChainThor blockchain. These nodes, X master and economic nodes, don’t produce ledger records or blocks, but are basically used to check power.

Any user meeting the required VET balance can become an economic node. For every 1 million VET held by an economic master node, a single on-chain governance vote is granted.

X-nodes, meanwhile, are only available for users that make their VET purchases on the secondary market. X-nodes generate 0.000432 VTHO per VET staked and also possess on-chain voting rights.

VeChain Ecosystem

The Proof-of-Authority (PoA) consensus mechanism has gone through an evolution from PoA 1.0 to its current PoA 2.0. Under the original PoA, which was initially rolled out with the release of the VeChainThor blockchain in the company’s 2018 rebranding, Authority Masternodes were required for block validation. They offered low energy consumption and greater efficiency but faced financial and scalability limitations.

With the introduction of PoA 2.0 in 2022, the system has managed to improve security, scalability, and data finality. The upgrade also addressed some of the major challenges faced by PoA 1.0 while offering a more robust consensus mechanism. This, the company feels, reflects the blockchain’s commitment to evolving technologically.

Governance

Steering Committee, elected by the stakeholder community, oversees and makes strategic decisions for VeChain improvement proposals (VIPs). This system offers crucial benefits like lower technical and organizational development uncertainty because of the role-based voting.

VeChain’s governance model also includes community engagement. This is achieved through tokenholder voting, which allows for broader participation when it comes to making key decisions in governance.

Dual Token Economy

One of the unique factors of the VeChain ecosystem is that it has dual tokens. There is the VeChainThor Energy (VTHO) token as well as the main VeChain Token (VET). VET acts as the primary token in terms of carrying value within the blockchain ecosystem. It also is used for stakeholder voting, transactional activities, and enabling investment.

VTHO, meanwhile, comes from holding VET. It acts as a mechanism to decouple the cost of using the market chain from the price of VET. This acts to stabilize transaction costs while also facilitating more efficient resource allocation on the blockchain.

VeChain’s Sustainability dApp Platform

VeChain has a number of decentralized apps (dApps) on its platform. Some have even become valuable tools with a drive toward sustainability. These technologies offer greater traceability, transparency, and economic incentives as VeChain partners with 4ocean to promote a fight against ocean pollution.

VeBetterDAO

VeBetter DAO is the decentralized autonomous organization (DAO) platform that has been built right onto the VeChainThor blockchain. It is a system that provides incentive for sustainable actions while also rewarding users that participate in a sustainability-driven Web3 ecosystem. Users can earn rewards for actions like avoiding plastic, promoting energy conservation, or using reusable cups.

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