Bitcoin has been the trailblazer for cryptocurrency since its launch in 2009. This led to the development of other altcoins that shaped the crypto sphere in the years to come. One of the thousands of digital coins that are available in the market today is VeChain.
Similar to other crypto assets including Cardano (ADA), Ether (ETH) and Ripple XRP that dominate the crypto sphere today, VeChain offers alternative solutions for the distributed ledger technology (DLT). Get to know the special features of this cryptocurrency as you browse BTC Post!
All about VeChain
The vision behind VeChain cryptocurrency is to provide blockchain technology for the next generation of cryptocurrencies and implement solutions to real-world economic problems. It does this by using DLT that allows a streamlined data and value transferring process among a wide range of users.
VeChain cryptocurrency: A brief history
Sunny Lu, the former chief information officer (CIO) of Louis Vuitton China, founded VeChain Tech in 2015. He headed the information technology (IT) operations of the luxury fashion house up until his resignation the same year he founded the blockchain company.
VeChain first started as a subsidiary of one of the largest Chinese blockchain companies called Bitse. Its native token also functioned on the Ethereum blockchain during its initial years until it transitioned onto its own blockchain by 2018.
During the transition, it rebranded and became the VeChainThor blockchain.
The main goal of the VeChainThor blockchain is to achieve mass adoption to further create a sustainable and scalable process within the blockchain ecosystem.
This public blockchain is built upon existing innovations of ledger technology for mass adoption and uses various governance mechanisms and Proof-of-Authority (PoA) consensus algorithm. This helps support decentralised applications (dApps) and initial coin offerings (ICO) made using the blockchain.
VeChain supports two tokens namely VeChain Tokens (VET) and VeChainThor Energy (VTHO), both of which are adapted from Ethereum’s ETH and NEO’s Gas concept wherein certain numbers of tokens are budgeted to conduct the transactions in the blockchain.
VeChain Tokens (VET)
The VET is the layer of the blockchain that is responsible for carrying value for smart contracts. This ‘smart money’ is used for transactions on the dApps occurring on the VeChainThor blockchain.
VET is available for public investment and is valued at US$0.09934 per token. The VeChain cryptocurrency also has a market capitalisation of US$6.3 billion.
VeChainThor Energy (VTHO)
On the other hand, the VTHO are tokens used to power the smart contracts and dApps transactions. These are the underlying tokens that are budgeted by the blockchain to keep transactions running smoothly on the ledger.
The foundation governance structure of VeChain
Scalability issues are one of the biggest challenges that many blockchains face today including Bitcoin. Since Proof-of-Work (PoW) consensus algorithms take longer to verify transactions and use an immense amount of energy, the challenge for rising altcoins is to find new solutions to make the process faster and more efficient.
VeChain cryptocurrency aims to solve the consensus concerns of blockchain governance by identifying the right stakeholders and forming a governance structure. This can help streamline the decision making within ledger updates and modifications needed for the network to function and adapt.
Board of Steering Committee
The VeChain Foundation is a non-profit entity responsible for the governance and development of the ledger. It is led by the Board of Steering Committee whose members are selected by the stakeholders of the blockchain.
Each member has two years to serve on the committee. Elections will be held every two years to launch a new board to govern the processes and development of the ledger.
Stakeholders with Voting Authority
There are three categories of stakeholders within the VeChain ecosystem namely Authority Masternodes, Economic X Nodes and Economic Nodes. These stakeholders have voting authority on those they wish to elect to the governing committee and other decisions needed for the ledger development.
Stakeholders of the Authority Masternodes are the maintainers of the VeChainThor blockchain. Each node is required to hold at least 25 million VETs on their accounts and should submit to proper Know-Your-Customer (KYC) verification by the foundation. For their services, they are rewarded with a 40% voting authority.
These nodes are the only stakeholders that are allowed to mine and verify the blocks on the ledger. They are also rewarded with 30% of the transaction fee for each block that they mine.
Economic X Nodes
Longtime supporters of the VeChainThor blockchain are rewarded with an Economic X Node stakeholder position on the foundation and a 40% voting authority. The members of this category were allowed to stake a minimum amount of VETs in the early stages of the ecosystem back in 2018.
This category is closed and no new Economic X Node can be created. However, existing members can upgrade their tier node on the blockchain.
New members of the ecosystem can stake their VETs and become stakeholders of the blockchain. Any VET holder can become an Economic Node if they stake the minimum holding requirement and apply through the VeChainThor Node smart contract.
Innovative VeChain features
VeChain Proof of Authority (PoA) 1.0 and 2.0
The blockchain is run using a Proof of Authority (PoA) algorithm consensus that requires miners to be authorised before participating in the ledger’s transaction processes. Under this protocol, each node has an equal chance of verifying and mining blocks while earning 30% of the profits per transaction.
This system features efficient bandwidth usage for higher output without using a vast amount of energy, making it sustainable. In turn, the blockchain can process a greater number of transactions per second.
VeChainThor Sync 2 Digital Wallet App
One of the problems for individuals and businesses tapping into dApps and smart contracts are the restrictions from browser-type platforms. Users need to have specific browsers or wallets just to access and implement these features for their use.
To solve this, VeChain utilises the Sync 2 Digital Wallet App that gives the power back to the users by eliminating the restrictions of browser-type platforms. It’s designed to work with all major browsers including Chrome, Safari, MS Edge and Firefox among others.
Simply install the app on your desktop and mobile device to have access to the VeChain network. You can also use a simple web browser to access the wallet.
Controllable transaction lifecycle and dependency
VeChainThor blockchain allows users to set the time when the transaction will be processed. If it doesn’t satisfy the command then the transaction will expire on a specific date if not mined on the ledger.
Moreover, the network gives users the power to set the execution order to meet the required business needs. This transaction will not be executed until the specified requirements are met.
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