What is VeChain (VET) and how does it work?


The key features of blockchain technology, including decentralization, immutability, transparency and automation, have proven to be suitable for a variety of enterprise use cases. However, due to the cost of building and maintaining blockchain-based applications, it can be difficult and expensive for businesses to fully exploit its benefits. 

 With the introduction of common accounting, many projects sought to reduce barriers to market entry. VeChain is one such blockchain platform designed to promote the widespread adoption of blockchain technology. 

One of the most important problems for supply chain organizations is the lack of transparency, which blockchain aims to solve by allowing companies to trade directly and without a third party. It also enables the exchange of information between stakeholders and supports the integration of financial and logistics services. 

 This article discusses what VeChain public blockchain is, the unique features of VeChain, how VeChain (VET) works, how to buy VeChain and how VeChain staking works. 

 What is VeChain (VET)? 

 A public blockchain called VeChainThor is designed to enable widespread adoption of blockchain technology by businesses of all sizes, serving as a building block for a sustainable and scalable enterprise blockchain ecosystem. 

 According to VeChain, Ethereum is not suitable for running large business applications (DApps), despite being an important technological milestone. This is because Ethereum lacks a strong governance framework that allows for quick and transparent protocol changes to address emerging issues or breakthroughs. 

 The Ethereum blockchain also lacks a proper financial model, which prevents companies from launching their DApps at manageable and predictable costs. Additionally, given  the volatility of the Ether (ETH) price, companies may not be able to predict future ETH prices or the cost of maintaining a decentralized Ethereum-based  application over a period of time. What makes VeChain unique? 

 The VeChainThor blockchain hopes to solve the above problems through the use of meta-transaction functions, a  consensus method of Proof of Authority (PoA), an on-chain governance mechanism, and a unique dual system. 

 Meta-Transaction Features 
 VeChain's enterprise-level meta-transaction features, as described below, help facilitate development:

Multi-Party Payments: The freemium model of a decentralized app enables flexible transaction payment delegation systems for users seamlessly. With VeChain's innovative payment delegation protocol, a business can have a smart contract and a designated gas account to manage the gas payments required to use the network. 

 Controllable event duration: Users can specify the time an event fires or expires if not contained in a block with the Event Expiration and BlockRef fields. 

 Multitasking Transaction: Developers can group payments, include multiple calls to different contract functions in a single transaction, and control the order of calls using multitasking. 

 Event Dependency: Users can set dependencies to prevent transactions from executing before that transaction is processed. This ensures that the performance order meets the needs of the business. 

 POA Agreement Mechanism 
 PoA often addresses the issues of energy waste and inefficient innovation by firms. VeChain's certificate of authority is effective because: 

 Hard forks can be avoided if the Masternode authority is not updated thanks to the built-in smart contract. 
 Network security and consensus integrity require little computing power. 
 The Foundation strictly verifies the identity of all Authority Masternodes operators. 

 Governance Overseeing the 
 VeChain ecosystem, the community-elected governing committee makes decisions and ensures their implementation through an on-chain governance mechanism (including, for example, proposing, approving and implementing proposals). Another advantage of such a system is the reduced uncertainty of organizational and technical development due to role-based voting. 

 Dual Token Ecosystem The 
 VeChain ecosystem consists of two tokens: VeChain Token (VET) and VeChainThor Energy (VTHO). The first token, VET, is used to generate another VTHO token and make payments or remittances to other VeChain users. The VTHO token settles transaction fees and covers the development costs of platform gas and smart contracts. 

 How does VeChain (VET) work? 

 The platform uses a PoA consensus algorithm that helps secure transactions on the blockchain network using a network of 101 Authority Masternode operators. These operators perform smart contract functions while following VeChainThor's rules. Guided by the steering committee, users must pass strict Know Your Customer (KYC) checks and be able to contribute to the growth of the network, whether as a company, developer or other entity. Additionally, the unique two character system and#
0;as discussed above and#
1; ensuring that companies are protected from market speculation and excessive market volatility and that they have greater confidence in their operating costs. 

 VeChain ToolChain is a key product offered by the VeChainThor blockchain platform, enabling companies of all sizes to collaboratively develop new services and products. VeChain ToolChain provides Platform as a Service (PaaS), Software as a Service (SaaS) and Blockchain as a Service (BaaS) to create new strategies for various stakeholders to create value, promote transparency and inform product lifecycles. 

 For example, VeChain's low-code implementation allows PaaS customers to design process models and use built-in tools to avoid building their own blockchain applications from scratch. In addition, its Food Safety Track and Trace SaaS provides the food and beverage industry with easy-to-deploy tracking features such as quality certificates to reliably communicate and increase brand awareness. 

 Through BaaS, VeChain provides a soothing API for standardized smart contract services. Two computer systems use a silent API, an application programming interface, to securely exchange data over the Internet. 
 Moreover, according to VeChain tokenomics, the amount of circulating supply will be reduced by 70% of all transaction fees, with the remaining 30% going to headnode operators. For node owners, VeChainThor offers a sustainable fee structure.

History of VeChain: Who is behind VeChain? 

 Former Chief Information Officer of Louis Vuitton China Sunny Lu co-founded VeChain in 2015 with Changpeng Zhao (the Chinese-Canadian founder of Binance)  as a subsidiary of Bitse, a blockchain solutions organization. The VEN token once ran on the Ethereum platform, but in 2018, VeChain moved to its own blockchain and renamed itself  the VeChainThor (VET) blockchain. 

 Through data transparency, VeChain hopes to disrupt the supply chain industry. The company has partnered with several companies, including Microsoft, PWC, BMW, Renault and Volkswagen, to use the unique features of the VeChainThor blockchain to improve their business operations. 

 Related: How is blockchain technology  used in supply chain management? 

 How to buy VeChain? 
 Depending on your jurisdiction, choose a crypto exchange that supports the VeChain (VET) cryptocurrency and purchase a wallet to hold your tokens. Alternatively, you can store your tokens in an exchange wallet. 

 VeChain has also developed a Thor wallet specifically for its  cryptocurrency, which is compatible with  Android and iOS. However, VeChain tokens are not compatible with wallets like MetaMask because they are not based on the Ethereum blockchain. As a final step, purchase the desired amount of VET tokens  and transfer them to the wallet of your choice for storage. Here are the main steps to buy 
  VeChain (VET) on Binance:

Can you earn passive income with VeChain besides buying professional training? Typically, users must first purchase other cryptocurrencies such as Bitcoin (BTC) and then exchange their BTC for VET after finding a wallet or exchange that supports VeChain staking. Unlike other cryptocurrencies, there is no mutual fund where VET investments can be pooled to earn more VTHO. 
 Related: How To Earn Passive Crypto Income With Bitcoin 

 Does VeChain Have NFTs? 

 Along with VeChain's supply chain use cases, its non-fungible token (NFT) ecosystem is also successfully developing. There is a decentralized NFT market called VeSea to create and trade VIP-181 tokens stored on the VeChain blockchain. The VeChain Foundation has adopted the VIP-181 standard, which enables the core functionality of smart contracts. 

 users need a VeChain compatible wallet to sell, buy and hold NFTs on VeSea compatible with VeChain Sync2 and VeChainThor Wallet. Additionally, VeSeal has no gas costs due to the efficiency of the underlying blockchain. However, users must pay a 2.5% transaction fee. 

 VeChain offers two collections of NFTs: VeKings and Paper Project. The VeKings NFT Series has 8,147 artworks depicting Vikings and Valkyries, symbols of the famous VeChain Empire. A total of 11,880 individually created NFTs make up the interactive NFT portfolio project developed and managed by Southern California artist Emmet Ahlstrom. 

 If anyone currently owns assets from either of these two NFT pools, VeSea will offer them a discount of up to 100%. World of V is another VeChain NFT exchange compatible with Sync2 wallet and free to use. Additionally, by offering full minting support, the platform welcomes new NFT projects to the launch platform and allows non-fungible token holders to contribute their NFTs to the creator ecosystem. 

 Is VeChain a good investment? 

 VeChain aims to accelerate the mass adoption of blockchain technology by addressing issues such as the high maintenance costs of Ethereum-based DApp. Despite VeChain's use cases in supply chain management and other industries, investment selection depends on financial goals and risk-return profile. 

 Instead, investing in a cryptocurrency that you feel you need more confidence in can be risky and you could lose your hard earned money. Therefore, make your asset allocation decisions based on your investment return expectations. 

 But is the VeChain network secure? VeChain works with several security companies including Hosho, Secureware, SlowMist and HackenProof to find potential vulnerabilities and prevent cyber threats. 

The Future of VeChain 
 VeChain is a layer 1 smart contract platform that allows developers to build unique smart contracts and DApps on top of it. Its applications in logistics, supply chain management and other industries help companies make their operations more efficient. However, from an investment perspective, you should always weigh the pros and cons before allocating your portfolio. 

 As the future is uncertain, VeChain is also uncertain. However, it is impossible to predict whether VeChain will become the new Ethereum. In any case, it is exciting to see how VeChain competes with competitors and offers different solutions to gain a competitive advantage.

Source: https://cointelegraph.com/news/what-is-vechain-vet-and-how-does-it-work

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