VeChain is a public blockchain startup that offers solutions to supply chain management problems on an enterprise level. VeChain can accomplish this by delivering cutting-edge solutions for businesses through the internet of things (IoT) devices that monitor goods and services from their point of origin to their final destination.
The VeChain blockchain is composed of two primary layers: an Internet of Things (IoT) token layer that makes use of a blockchain to capture and record activity from IoT devices; and a smart contract layer that businesses can utilize to track ownership of their goods and services as well as construct their decentralized applications. The IoT token layer uses blockchain technology to capture and record activity from IoT devices (dApps).
VeChain was introduced to the public as an ERC-20 token with the VEN ticker. This was before the company had its private blockchain network. (For additional information about ERC-20 tokens, look at the page dedicated to Ethereum.)
On June 29, 2018, the Vechain mainnet, also known as the VechainThor Protocol, went live. This occurred the next year. When the mainnet was made available, the ratio for converting VEN to VET was 1 VEN to 100 VET.
The launch of the VeChainThor protocol resulted in creating a second token, known as Vechain Thor, which may be used on the VeChain mainnet. The first token, VET, is the native currency of VeChain.
On December 26, 2018, the VeChain Foundation announced the launch of the research program. This project is an initiative that seeks to reward researchers for their contributions to the VeChainThor platform.
The foundation created X Node programs in July 2018. In addition to rewarding research, X Node programs award users who “stake” their coins through a designated node that runs on either a cloud or hardware device.
What is so special about it?
VeChain was designed with a fairly specialized approach as opposed to being a blockchain that could be used for everyone and everything. Its structure (more on that below) is designed to transfer goods and services across the supply chain, which makes its token, the VET, a utility token. Its token’s name is also VET.
In addition, it uses a dual-token structure, wherein one type of token finances the projects while the other type of token powers the blockchain.
VeChain has also taken a very strategic approach to form partnerships, successfully obtaining a collaboration on a national level with China as that country works to construct smart cities.
In addition, it has collaborated with PricewaterhouseCoopers (PwC), which has assisted in marketing VeChain’s blockchain technology to various customers. Indeed, a former PwC executive works as the Chief Operating Officer of the VeChain Foundation, and an active PwC executive is a member of the organization’s steering committee.
How does VeChain work?
VeChain is a project that has formed its blockchain platform in the past year and is seen as a highly secure network. The network’s goal is to assist in the tracking of goods and services from their point of origin and help businesses maintain complete security for their assets. Its blockchain is known as the VeChainThor protocol and was created in partnership with BitSE.
Apart from the mainnet, it has several private blockchains that are used to track asset records (the VET)
Real-world tech:
The VeChain platform includes a supply chain management system that allows businesses to track their assets. It also has a reputation system and an in-house token that is used as a payment method.
VeChain Foundation:
The VeChain Foundation is responsible for the project’s overall direction and puts forth a lot of effort to prevent mischief. It was founded as a non-profit organization in Shanghai, China.
VeChain can function because it assigns a one-of-a-kind identifier to each piece of tangible merchandise, typically using RFID (radio frequency identification), QR Codes, or NFC (near-field communication).
Sensors record information at each level of the supply chain, which is then recorded and associated with the identification of the product. VeChain is responsible for the design of these sensors, which are then manufactured by companies such as Bosch and Qualcomm.
Because it makes use of blockchain technology, the data that has been recorded cannot be altered. This enables a record to be kept that is accurate regarding the conditions that existed throughout the supply chain.
In the event that something went wrong, such as products being delivered to the incorrect location, the record kept by the blockchain will specify where precisely the error occurred.
Additionally, it enables the recipient of the products to verify that the transaction was carried out appropriately and that the goods in question are genuine. This is of utmost significance in the fight against fraud in the luxury goods industry, particularly about high-end handbags.
A tiny chip is inserted inside the handbag, and when scanned, it provides information about the many steps the handbag went through on its way from the manufacturing stage to the delivery phase. Because this chip is still present even after the handbag has been sold, it is feasible for the previous owner to acquire a used bag on eBay while still being able to verify that the bag is legitimate.
The cryptocurrency:
VeChain tokens, which are used to power the blockchain and reward users who buy into the program are called VET. The tokens can be purchased through exchanges and are also used as a form of payment in some cases. They can be purchased with other cryptocurrencies, such as ETH or BTC. Using fiat currencies (USD, Euro) is also possible, but this option currently needs to be widely accepted.
The platform:
VeChain aims to provide a platform for businesses to store their inventory securely, with the added feature of easily verifying the integrity and quality of those items. It also provides a service for businesses that wish to track their products from a supply chain perspective, providing accurate and immutable information.
VeChainThor Blockchain:
The VeChainThor Blockchain is available on the internet for everyone to access. It has already been launched, and it can function without any hiccups.
The platform’s network protocol defines the VeChain token as VET. There are four phases in which the tokens are used:
The platform’s native token is called VET, with a total supply of 1,000 million. The total amount of tokens in circulation has increased by 40% over time as more businesses have decided to use the VeChain technology. Each type of token can be purchased separately; however, they can also be generated through CPU and GPU mining.
What can you do with VeChain?
The VeChain platform has several functions that can assist companies in tracking their products or just about any good. There are also various options for both customers and businesses to use as a payment method within the network.
The company created the technology to create sensor chips for physical objects that are inextricably tied to VeChain’s blockchain platform. The method is oriented solely toward the incorporation by a large number of businesses. Since 2015, when it first manufactured NFC tracking chips to be inserted inside handbags for a French luxury brand, the company’s technology has been used in real-world applications.
After that, in 2016, VeChain implemented similar technology for the Renault automobile industry to track the history of vehicles. It maintains a record of the car’s service history, mileage, and everything else that has occurred to the vehicle from the moment it was first driven on the road.
Used car purchasers can access this immutable record, which provides them with a comprehensive vehicle history and is a significant step toward combating problems such as odometer fraud.
VeChain has also established agreements with BMW and other automobile manufacturers in Europe and Asia. This technology has applications in various other markets, and VeChain has hinted that it is currently working on several other significant partnerships.
Future of VeChain:
VeChain is considered one of the most important blockchain platforms, with investors expecting it to grow exponentially shortly. The VeChain computing network can record extremely valuable data, and it will likely see a dramatic increase in use over time.
The VeChain Foundation recently received a huge investment of approximately $20 million USD from Galaxy Digital, a well-known investment firm that Mike Novogratz founded.
What Kind of Economic Model Does the VeChain Platform Have?
The VeChain VTHO token, which reflects the actual cost of using the VeChain platform, will be consumed once particular blockchain actions have been carried out.
The purpose of VET is to act as a value-transfer medium, or, to put it another way, as smart money, to facilitate the quick circulation of value within the ecosystem based on VeChain.
As a different kind of incentive, VET is granted to network nodes that, through the operation of their services, contribute to the growth and maintenance of the ecosystem.
These economic nodes are not included in the consensus model (for more information, see below), but they are anticipated to play a role in maintaining the integrity of VeChain.
The system’s architecture is such that the accumulation of VET tokens will, of its own accord, result in the production of VTHO. To put it another way, whoever possesses VET will be eligible to get free VTHO and will be able to use VeChain without charge, provided that the amount of VTHO consumed by the operations conducted is less than the amount of VTHO generated.
Users can obtain additional VTHO for completing bigger-scale tasks, such as operating applications hosted on the VeChain Thor blockchain, by transferring and trading the VTHO tokens, which are fungible and may be transferred between users.
How Does Proof-of-Authority Work?
The governance architecture of VeChain is intended to encourage a balance between decentralization and centralization, as well as between transparency and efficiency. The members of the VeChain community vote for members of the Steering Committee, which serves as the organization’s governing body. The Proof-of-Authority (PoA) consensus is essential to the operation of the network.
On the VeChainThor platform, stakeholders are represented by VET holders. Depending on the circumstances, these VET holders may sometimes be given specialized roles, such as Smart Contract Owners and Authority Masternode holders.
There can only be 101 Authority Masternodes in total, and to function, each one needs to be approved by the VeChain Foundation and the rest of the VeChain community.
Transactions and blocks on the network require validation performed by authorized accounts that have been given the validator role. Validators use software that enables them to add transactions to blocks and validate such transactions.
Before that, these individuals or entities must voluntarily expose their identity and offer information about their reputation to be allowed to validate and produce blocks.
This is required so that they can be awarded the authority to validate and generate blocks. Because the procedure is automated, validators are exempt from having to keep a close eye on their computers at all times. It is necessary, however, to ensure that the computer serving as the authority node is not corrupted.
VeChain supports this consensus mechanism as delivering the following significant benefits based on the information presented here:
- A modest demand for the available processing power
- There is no requirement for communication between Authority Masternodes to arrive at a consensus. The continuity of the system is independent of the number of Masternodes currently available.
- Hard forks can be avoided by utilizing built-in smart contracts to manage Proof-of-Authority. This allows for instances in which the Authority Masternodes cannot successfully implement an update.
Conclusion:
VeChain is certainly one of the most exciting blockchain platforms in existence today. It has shown great potential, and the team behind it has made significant inroads into numerous industries. The capabilities that VeChain provides are already being utilized by various enterprises and will likely see even more adoption over time.
The VET token will likely increase in value as the platform becomes more popular and expands over time.
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