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VeChain Blockchain and VeChain NFTs

VeChain is a layer-1 enterprise blockchain ecosystem focused on supply chain tracking. As such, its common use cases include provenance, authenticity, anti-counterfeiting, and digital assurance solutions for the food and beverage industry as well as luxury products.  

The company has recently announced a multi-year sponsorship agreement worth $100 million with the Ultimate Fighting Championship (UFC). Another partner is Alchemy Pay, a fiat-to-crypto bridge, which enables payments with VeChain’s native token in over 2 million stores. 

VeChain’s dual-token economy

VeChain uses the public blockchain VeChainThor which deploys a two-token economic model. The primary token is VET (VeChain Token), which is used for value transfer within the ecosystem. It functions similarly to native tokens of other blockchains. The second token, VTHO (VeThor Token), is for transaction payments.

The cost of using a blockchain depends directly on the native token’s market valuation. This is a significant obstacle to blockchain’s widespread adoption, particularly by big enterprises and businesses, VeChain’s primary customers, which require payment costs to remain as stable as possible. That’s why the company uses two different tokens. If the price of VTHO increases, the gas price decreases, keeping the total transaction costs stable. 

VeChainThor’s consensus mechanism

VeChain’s blockchain adopts a proof-of-authority consensus algorithm which verifies network participants’ identities to reach consensus. It’s a reputation-based algorithm and requires a limited number of validators. Consequently, it’s highly scalable, fast, and energy-efficient.

VeChain NFTs

Because it was built to enable enterprises to track supply chain operations, VeChain’s ecosystem is particularly suitable for creating NFTs that link digital with physical products by applying NFC and IoT technologies. The company offers such solutions for B2B customers. On the other hand, there are also VeChain-based NFT collectible projects and marketplaces that we are accustomed to seeing in web3…

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