VeChain is an enterprise-focused blockchain platform that provides robust tools and infrastructure to help global organizations integrate blockchain technology. Originally founded in 2015, VeChain has evolved into one of the most widely adopted blockchain solutions optimized for business needs like supply chain digitization, data management, and IoT integration.
As the first issue in this masternode series, we explore VeChain’s origins, timeline, how it operates, key enterprise features, partners, tokenomics, masternodes, and governance model.
Origin of VeChain
VeChain was founded in 2015 by Sunny Lu, former CIO of Louis Vuitton China. It emerged out of BitSE, one of China’s first blockchain companies, which was founded by Lu in 2013.
Lu leveraged his experience with luxury goods supply chain management to build blockchain solutions tailored to enterprise needs. He teamed up with co-founder Jay Zhang to start the VeChain project focused on business applications.
The VeChain Foundation, a non-profit entity overseeing the platform’s development, held a token sale in 2017 to fund the project’s growth. The mainnet officially launched in 2018.
Timeline of VeChain Development
Some key milestones in VeChain’s growth since 2015:
- 2016 – VeChain whitepaper published outlining vision and core technology.
- 2017 – VeChain token sale raises $20+ million to fund development.
- 2018 – VeChainThor mainnet officially launches with core blockchain infrastructure.
- 2019 – ToolChain suite launches to provide easy business integration tools.
- 2021 – VeChain enterprises solutions host over 10 million transactions.
- 2022 – VeChain transitions to a fully community-governed model.
- 2022 – VeUSD stablecoin introduced to bridge crypto and fiat.
- 2023 and beyond – Focus on global enterprise and IoT adoption continues.
How VeChain Works
VeChain utilizes blockchain technology to create transparent and immutable business records for enhanced efficiency and security. Key aspects of its model include:
Proof of Authority Consensus
VeChain uses a Proof of Authority consensus model. A certain number of nodes authorized by the VeChain Foundation validate transactions and maintain the ledger. This Optimizes stability and scalability for business usage compared to permissionless models.
Dual Token Model
Transactions on VeChain are settled using two tokens – VET and VTHO. VET is used mainly for value transfers. VTHO (VeChainThor Energy) powers the computations required to execute transactions and smart contracts.
This set of tools and APIs allows businesses to easily integrate VeChain-powered capabilities like supply chain tracking, data storage, and carbon management.
VeChain makes it easy to integrate Internet of Things devices to capture granular performance data and automate business processes powered by real-time data flows.
The VeChain Ecosystem
VeChain hosts a growing ecosystem of applications and partnerships:
Decentralized applications like VeriART for digital art authentication and Totient for medical data sharing run natively on VeChain leveraging its advanced functionality.
Major companies across industries including Walmart, BMW, LVMH, and PwC partner with VeChain to develop custom blockchain solutions.
Launched in 2019, this program partners promising startups with VeChain’s clients to develop blockchain solutions on the VeChainThor platform tailored to enterprise needs.
VeChain uses a masternode model to maintain its Proof of Authority consensus:
- Masternodes stake and maintain a minimum of 25 million VET to qualify.
- Masternodes participate in block production and validation under the Proof of Authority model.
- In return, masternode operators receive rewards from block production and ecosystem funds.
- Masternodes also participate in platform governance through voting.
The masternode model allows VeChain to achieve the enhanced performance demanded by enterprise users leveraging the blockchain’s capabilities.
VeChain’s governance model has evolved from a centralized foundation to decentralized community-led:
- Originally the non-profit VeChain Foundation oversaw platform development, funding, partnerships.
- In 2022, VeChain transitioned to a fully decentralized Steering Committee elected by VET holders.
- The Steering Committee is composed of 7 seats elected annually by the community.
- They are responsible for budgeting foundation assets and determining platform upgrades.
This governance shift empowers the community and maintains the ethos of decentralization underpinning blockchain technology.
Since launching in 2015, VeChain has established itself as one of the most advanced and widely adopted enterprise blockchain platforms thanks to its robust tooling and ecosystem. Its vibrant network strives to use blockchain technology to enhance transparency, automation, and data sharing across global supply chains and commercial operations. With its focus on enterprise and IoT integration, VeChain has successfully positioned itself at the forefront of commercial blockchain adoption.