What is VeChain (VET), and How Can I Buy It?

Blockchain is a young technology, and it’s up in the air about which applications of it will be the most useful. We have Bitcoin to store value, Chainlink to pull real-world data onto the blockchain, and Ethereum to execute smart contracts. VeChain introduces a new use case for blockchain- supply chain management. The single most important factor for a cryptocurrency to appreciate in value is adoption. Adoption can be through real-world use case or investment. The global supply chain management industry earned $16 billion in revenue in 2019, and is growing at a rate of 11% per year. If VeChain finds a foothold in the global supply chain management business, the sky is the limit. VeChain is currently available on Binance, including within the US on Binance.US. VeChain is also available on KuCoin.

What is VeChain
VeChain is a blockchain solution to global supply chain management problems that are only getting tougher each year to solve. Founded in 2015 by former Louis Vutton CIO Sunny Liu, the project has been hard at work securing corporate partnerships and upgrading its network. VeChain can technically function as a smart contract crypto, but this isn’t its most valuable use case. VeChain does behave a bit like an Oracle Crypto in that it brings real-world data onto the blockchain.

The pandemic and the ‘bull whip effect’ and how VeChain could help it
If you’ve been to a grocery store or gas station lately, you know that the COVID pandemic has supply chains way out of whack. Where is the toilet paper, or bottled water, or Ritz Bits? Why does it take $70 to fill up your tank? Is there something pre-pandemic you were always able to get at the grocery store but now it’s harder to come by? These things happen because there are huge swings in demand during pandemic times. Companies will think life is getting back to normal, and then a new variant of the virus comes along and screws that up. Demand for bottled water will spike, and then drop off. This makes it near impossible for oil producers or grocery producers to estimate demand. Slight overproduction and underproduction can lead to huge shocks in the supply chain. Economists call this the ‘bull whip effect’.

Why VeChain will be big
VeChain provides an easy way to track, manage, and control the quality of inventory of goods. Instantaneous, immutable, and decentralized tracking of supply chains could hold immense economic value. Unfortunately, companies have been doubling down on traditional supply chain management approaches. VeChain is a ways off from mass adoption. Still, the project has had a knack for securing solid partnerships that have generated a lot of hype. But with hype, you have to be careful.

How it works
VeChain is unlike other cryptos in that it is neither proof of work or proof of stake. Instead VeChain works with a proof of authority (PoA) where consensus nodes are delegated before they take part in the network. Only 100 PoA nodes exist on the network. While this improves transaction speed and network scalability, it also makes the network more vulnerable to attack. Imagine if hackers could bring down 51 of the 100 nodes. The implications of disrupting global supply chains would be enormous. VeChain runs a network that gathers real-time information via the internet of things.

Let’s say you’re BMW and you’ve got to manage thousands of parts from hundreds of suppliers to build your cars. Your factory is in Bavaria, but your suppliers are anywhere from Japan to Mexico. The profitability of your business depends on the right parts arriving in the right place at the right time. Running means having fast and accurate information from hundreds of places. Doesn’t that sound like something blockchain would be a good solution for?
With the VeChain network, you have thousands of RFID sensors installed across all your suppliers. You have other remote sensing data coming in as well- say temperature data and humidity data for sensitive metals you will use on the car. A constant amount of data on all parts are announced on the blockchain. Since the blockchain is decentralized and immutable, it’s easy to go back and check data if something went wrong. The network is fast and can scale- so it wouldn’t matter if you were building 100,000 cars per year or 10 million.

BMW has announced a partnership with VeChain

VTHO token
VeThor (VTHO) is VeChain’s currency/utility token. If you take a look at the price histories of VeChain and VeThor (VET and VTHO), you’ll see that the two have different price action. Since its beginning, VTHO has gone on an absolute tear, up 20x. The more the VeChain network is used, the higher the price of VTHO goes. This is a positive sign for the VeChain project.
Solid tokenomics
Some projects like The Graph Token (GRT) have token vesting schedules for early investors. This means that new tokens get released into the network and the holders likely sell them- decreasing the price. Lucky for us, VeChain doesn’t have this problem. Only 86 billion tokens will ever exist, half of which are in circulation already. No coins held by early project investors are still locked up. If the supply of something like a crypto increases, with stagnant demand the coins you hold will lose money. Tokenomics are as equally important for crypto investing as the crypto project’s use case.

Where to buy
I’m a huge fan of storing your own coins, no matter where you buy them from. What if you were to buy your coins on Binance, and then Binance is made illegal in your country? It would be much better for you to have your coins on a hardware wallet. To buy VeChain or VeThor, simply make an account on any of the following: KuCoin, Gate.io, Huobi, or Binance. Then buy some VeChain. If you’ve got a hardware wallet, transfer your coins over.
The future of VeChain
It’s important to see past all the hype brought forth by Sunny Liu, VeChain’s founder. People immediately see a partnership with Walmart and think that there is some pending explosion in value for the coin. Yes, Walmart is huge- but in what capacity is the VeChain project being used by Walmart? The actual use case and adoption could be very small. Still, with the complexity of supply chains only increasing, it’s hard to see a future without some strong adoption from corporations for VeChain. I don’t know what this holds for the actual price of the VeChain coin, but the use case is solid.

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