VeChain is a blockchain based platform which aims to build a trust free and distributed business ecosystem for companies. The blockchain has commercial use cases in several industries such as retail, agriculture, logistics management and luxury goods. Its best application is perhaps in the logistics and retail sector where it can trace the journey of a product from manufacturing to the end consumer. The project recently rebranded to VeChainThor blockchain from VeChain.
Blockchain X or Blockchain 3.0
After being launched in 2009 by Satoshi Nakamoto, Bitcoin become the first prototype of a blockchain. Ethereum which was launched in 2014, is widely referred as blockchain 2.0. The VeChainThor blockchain brands itself as blockchain 3.0 or blockchain X. The team began working on the project in early 2007 but gained momentum with the launch of VeCoin in 2015 .
VeChain was launched as a blockchain based platform which could be used to increase transparency and resolve ownership issues. A blockchain uses a public ledger to store record of all transactions of the network. Thus it is decentralized and trustless. Enterprises can use VeChain for many applications. It is a smart contract platform hence dapps can be developed for audit services, wallet services, KYC services, voting services, smart contract certification and digital ownership of assets.
VeChain Thor Blockchain
The blockchain has adopted a governance model which is an overlap between decentralization and centralization. A set of guidelines termed as ‘Governance Principles and Charters’ has been adopted by the VeChain foundation. These rules are designed to facilitate the growth and development of the ecosystem.
Smart contract owners and authority master node holders are a crucial part of VeChain. They ensure smooth running of the network at all times. However, they have to hold a certain number of VEN tokens in order to be accepted as a node. VEN is the digital currency of the VeChain blockchain. It will be renamed to VET to reflect the change in the name from VeChain to VeChainThor.
Founder Sunny Lu said,
“The VeChainThor Platform is a public blockchain that is designed for mass adoption through enterprise adoption. As the leading enterprise level blockchain, at mainnet launch, the VeChainThor blockchain will be the public blockchain with the most business activity in the world, in turn creating the most real-world value through the use cases of these influential entities.”
Proof of Authority Consensus Algorithm
Bitcoin blockchain works on the Proof of Work (PoW) consensus algorithm while Ethereum employs the Proof of Stake (PoS) consensus algorithm. Both have their own drawbacks and hence VeChain uses a Proof of Authority consensus algorithm. VeChain has a set of pre approved authority nodes and any new node can only be added has to be voted by them.
The VEN digital currency is currently an ERC 20 token on Ethereum blockchain and hence cannot be mined. The token will rebrand to VET at the time of launch of mainnet. This is when it is expected to convert to a digital currency and the VeChainThor blockchain goes live.
The token has a maximum supply of 873,378,637 VEN while the current circulating supply stands at 554,545,494 VEN. At the peak of the crypto bull run of 2017, the price of 1 VEN reached $9.55 but it is currently trading at $1.90.
The token was launched as an ICO on Ethereum blockchain and 1 VEN was equivalent to $0.239 at its launch on August 22, 2017.
Partnerships and Future Outlook
The thirteenth five year Chinese investment plan had called for greater investment in blockchain technology. VeChain was one of the benefecaries of the move. It has signed partnerships with BMW and Bithumb. The blockchain also has a built in disaster recovery plan to safeguard VEN tokens and users if the network is attacked. Regulators have criticized cryptocurrencies for their privacy features. But the VEN token is highly compliant with regulators as its ownership can be traced. Thus there are lower chances of VEN being used for money laundering or other illegal purposes.