VeChain - $VET, Asset Review
General Information-What is VeChain
VeChain Background
VeChain Funding/Collaboration
Token Information-Tokenomics
Staking/Governance
Additional Information-
What is $VTHO?
Technical Analysis
Conclusion
General Information-
What is VeChain
Vechain is a blockchain protocol that is designed to increase business efficiencies and supply chain management. With the use of distributed ledger technology (DLT), it is simpler to streamline information for complex supply chains. VechainThor is the public blockchain that the protocol lives on where others may participate on the network. The main focus of VeChain is to work with other businesses to become more sustainable and scalable using their blockchain. It is important to note that VeChain has enterprise-grade applications for multiple sectors in food safety, automotive, sustainability, and much more.
2. VeChain Background
Vechain is a project based out of Singapore, Asia, and founded by Sunny Lu in 2015. Vechain started as a fork of Ethereum in 2017, then later launched on its network in 2018. Vechain developers have built a multi-purpose protocol on their network that range from, on-chain governance, cheap fees, interoperability, and regulatory compliance. Sunny Lu believes in bringing trust into every aspect of the world. The use of the blockchain made it easy for everyone to see what was being built in real-time. On top of being transparent, he believed that building blockchain applications should be super easy therefore he created Vechain to bridge the gap leading to the success of the network.
3. VeChain Funding/Collaboration
VeChain held an ICO in 2017 raising a total of ~$60 million. They also have investors like PwC, Hash Capital, Block VC, Ciper Ventures, Myriad Capital Management, and more. Most notably, Vechain is partnered with Walmart China subsidiary to increase supply chain transparency for its food products. Sam’s Club utilizes a tool from the Vechain platform with other hardware technologies to automate data entries for the supply chain. This technology allows customers to scan QR codes to display detailed information on the origin of the product. This use case is extremely fascinating from a business side and consumer side and it's clear to be working. Later that year, it was noted by Sam’s Club expanded this product into other goods. Vechain is also partnered with brands like UFC, PwC, Groupe Renault, BMW Group, and a lot more. Each collaboration has its unique elements that make the network multi-purpose.
Figure A
Token Information-
Tokenomics
$VET is the native token for the VechainThor network. Currently, their circulating supply is 72,511,146,418 billion tokens, with a capped total supply of 86,712,634,466 tokens according to CoinGecko. A total of 68.86% of the supply was sold to investors. The remaining 31.14% was sold to the founders and project according to Messari.io. At one point the VeChain foundation burned 13.3% of the supply as a part of the token sale refund process. In a later part of this article, we will also discuss $VTHO which goes hand and hand with $VET’s tokenomics. At the time of writing this, the biggest holders of $VET are exchanges which can be found on the explorer.
Figure B
2. Staking/Governance
$VET staking is fairly simple depending on the tier you decide to go with. Per the image below, you will see the complexity and reward for each category. Each category also yields different voting power in the governance system. For example, running a Mjolnirnode requires holding 15 million $VET tokens but will give you more voting power. Additionally, the governance system is unique because master nodes have 40% of the voting power. It is important to note that running a master node will require full KYC verification from the VeChain Foundation. In some ways, this makes it centralized, because the majority of voting power comes from people who need to “register” with the Vechain Foundation.
Additional Information-
What is $VTHO?
$VTHO is the gas of the VeChainThor(VTHO) ecosystem. Each time a transaction occurs a small percentage of $VTHO is required to complete the transaction. Even businesses and developers are required to use $VTHO for operating smart contracts or uploading data. Something really interesting is how node operators may earn $VTHO for holding $VET. For every transaction that occurs 70% of $VTHO gets burned and the remaining 30% is rewarded to the node operator. With users constantly using the network, and $VTHO’s aggressive burn one can safely assume that the value of $VET and $VTHO will rise together.
Figure C
2. Technical Analysis
Figure D
$VET has had an amazing run from $.0015 to $.27 yielding ~200x + returns! Ever since $VET hit all-time-highs, we have seen the price fall towards a high time frame demand zone (blue box) which should act as a support region. That image was shared on my Twitter on July 18th at $.024. Ever since that low, $VET has risen to .028 equaling about a 20% gain. The next big resistance for $VET is $.03 and $.035. The way the move subdivides will give hints on how the next move plays out. Bottom structures typically take a long time to form and reverse when the bears are exhausted, so it's best to stay patient for a clear pattern. All in all, the price action of this chart is very bullish over the long term, and holding the support will be crucial.
Conclusion
VeChain is utilizing blockchains in a way that has never been done before. By utilizing smart contracts and IoT, a business can track their goods from point A to point B and know everything about it. This makes VeChain extremely attractive for business because of the advantages of transparency. The blockchain is immutable, meaning a business receiving products would not have to worry about counterfeit products by utilizing the Vechain network. Additionally, with the use of IoT sensors, a business may also track humidity and temperature. This ensures the quality was retained during the shipping cycle. These unique use cases have attracted many partnerships and led to the overall growth of the blockchain which makes me bullish on what’s to come. Lastly, while I am bullish on VeChain, it doesn’t mean it's correlated to the value of the $VET or $VTHO.