VeChain, along with its native token VET, was created in 2015 with the aim to streamline high-speed value transfers and modernise supply chains via blockchain technology. According to CoinMarketCap, VET currently ranks as the 28th largest cryptocurrency by market cap with an aggregate value of $1.25 billion. In this article, we take a deeper look at the coin’s history, use cases, and market performance.
VeChain: A brief history
VeChain was established in June 2015 by Sunny Lu, the former CIO of luxury goods company Louis Vuitton. Originally founded in China, Vechain is currently headquartered in Singapore, with 5 additional offices stationed all over the world.
The intention of the VET token is to solve the biggest issues in transparency and efficiency within supply chain management—something Sunny became closely familiar with from his days working at his former premiere fashion company. Formerly operating via the Ethereum blockchain, VeChain branched off to its own blockchain in 2018 with the launch of the VeChainThor mainnet.
Use cases and partnerships
While at Louis Vuitton, Sunny Lu witnessed firsthand how supply chains could be negatively influenced by human interference. This drove VeChain to create “trust-free” structures which would effectively fix logistical pain points.
To do so, VeChain incorporates a variety of technologies including, Radio Frequency Identification (RFID) tags, blockchain, and the internet of things (IoT) to create an environment that resolves issues in tracking, quality control, and inventory management within the logistics industry.
VeChain caught the attention of major enterprise companies early on in its growth stage, attracting PwC, one of the Big Four accounting firms, as a major investor as well as working on several proofs-of-concept projects for major automakers BMW and Renault. More recently, VeChain joined forces with Walmart China, employing its VeChainThor blockchain for food traceability.
Market performance and tokenomics
Unlike most crypto projects, VeChain employs a dual token economic model to offset volatility and keep transaction fees stable. While VET works both for governance and investment, a secondary token, VTHO, is used to pay for transactions—not unlike the way ethereum uses its native token, ether, as the gas that fuels its network trasnactions
VET is a proof-of-stake (PoS) cryptocurrency and uses A token weighted governance system to enact protocol upgrades.
As a point of difference to many other PoS-based blockchains, VeChain uses “proof-of-authority”—a type of consensus mechanism in which network validators are required to confirm their identity via officially issued documents.
The total market capitalisation for VeChain sits at approximately $3.1 billion, providing it with a rank of 28 in the top cryptocurrencies by market cap. VET struck an all-time high of $0.058 in February 2020, after recovering from its all-time price low of $0.0016 in March 2020.
At the time of writing, VET posts a year-to-date increase of 140% at a current price of $0.048.
There are currently 64 billion tokens in supply, with a total supply of 86.7 billion yet to be distributed.
The top exchanges for VeChain are Binance, Huobi Global and HitBTC.
VeChain Review: Conclusion
With a substantial use case, good history of partnerships and clients, and a solid market performance, VeChain certainly stands out in the market. However, with stiff traditional competition form the likes of IBM, and SAP and their own blockchain-based supply chain solutions, VeChain’s market advantage could dwindle.