What is VeChain?
VeChain is a blockchain platform designed to enhance supply chain management and business processes. It aims to streamline these processes and information flow for complex supply chains using distributed ledger technology (DLT). VeChain comprises two distinct tokens: VeChain Token (VET) for transferring value and VeChainThor Energy (VTHO) for powering smart contract transactions.
Transforming Business Operations
- VeChain is an enterprise blockchain platform offering a comprehensive view of an organization by breaking down data silos.
- VeChain aims to become a leading platform for initial coin offerings (ICOs) and to facilitate transactions involving IoT-connected devices.
- The platform utilizes two tokens: VET as the value layer and VTHO as the smart contract layer.
Understanding VeChain’s Vision
VeChain’s mission is to build a trust-free and distributed business ecosystem platform that ensures transparent information flow, efficient collaboration, and high-speed value transfers. Current supply chain data is scattered across silos involving multiple stakeholders, impeding information flow. VeChain’s solution involves a blockchain technology that returns data ownership to its rightful owners, providing a 360-degree view of all necessary information linked to a product and its business processes—such as storage, transportation, and supply.
Real-World Applications of VeChain
For instance, VeChain can be used to:
- Track the quality, authenticity, storage temperature, transportation medium, and last-mile delivery of a medicinal package or an alcohol bottle from the manufacturing facility to the end customer.
- Smart chips or Radio Frequency Identification (RFID) tags and sensors broadcast key information onto the blockchain network, accessible in real-time by authorized stakeholders.
- This diminishes discrepancies as all related parameters are continuously monitored, and any issues are promptly communicated.
In another example, VeChain provides automobile owners ownership over their data to negotiate better terms and policies with their insurance firms.
A Journey Through VeChain’s History
Founded in 2015 by Sunny Lu, former CIO of Louis Vuitton China, VeChain began as a subsidiary of Bitse, one of China’s large blockchain enterprises. Initially, the VEN token operated on the Ethereum blockchain. In 2018, VeChain transitioned to its own blockchain—VeChainThor (VET), and rebranded itself.
VeChain aims to disrupt the supply chain industry, fostering a transparent and actionable data space. In addition to disrupting supply chains, VeChain targets leadership in dApps and ICOs, and becoming an intermediary for IoT devices.
Strategic partnerships with firms like PricewaterhouseCoopers (PwC) and Renault bolster VeChain’s blockchain-powered alternatives, enhancing product verification and traceability.
VeChain’s Advanced Blockchain Platform
The VeChainThor blockchain is catered towards mass business adoption, utilizing two tokens—VET and VTHO. VET works as ‘smart money’ for transactions on decentralized applications, allowing public investment. VTHO, on the other hand, powers transactions on VeChain, covering the costs of conducting transactions on the blockchain.
VeChain implemented a two-token strategy to facilitate effective governance and install a predictable economic climate for developers. This offers a solution to Ethereum’s volatility issues by precisely budgeting transaction costs with VTHO tokens.
VeChainThor’s Governance Protocol
VeChainThor’s blockchain employs Proof of Authority for consensus. Voting rights are distributed according to VET holdings and disclosure using a sophisticated system to ensure minimal energy consumption and fast transaction validation. With 101 master nodes, VeChain reserves more control and balance within its ecosystem compared to Bitcoin’s universal node consensus.
Related Terms: Blockchain, Smart contracts, Supply chain management, Distributed Ledger Technology.
References
- VeChain. “Our VIsion: Whitepaper.”
