VeChain is a top blockchain project that was built by a former senior executive of LVMH, the world’s largest luxury brand. The initial goal of VeChain was to help companies solve their supply chain challenges in a simple decentralized ecosystem. In this article, we will explain what VeChain is and why we think it is a good investment.
What is VeChain?
VeChain is a blockchain platform that helps businesses solve the world’s biggest supply chain challenges. As a result, it solves one of the biggest challenges that many businesses around the world are facing due to the Covid-19 pandemic and the logistical challenges that have emerged.
VeChain was created by Sunny Lu and Jay Zhang. Lu was previously chief technology officer at LVMH China while Jay was a senior executive at PwC China.
The network works by combining a number of technologies such as QR codes, near field communication (NFC) and radio frequency identification. As a result, its users attach sensors to each step of their supply chain, which are then linked to the blockchain. The blockchain and smart contracts involved make it impossible to alter these records.
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VeChain uses a software platform known as VeThor, which is designed for mass adoption of blockchain technology. It is a platform built using a technology known as Proof of Authority, which is its primary governance mechanism. Unlike Proof of Work and Proof of Stake, PoA requires each node to be authorized to access the network.
Today, VeChain is used by some of the major companies in China. Some of the most notable companies that have adopted VeChain are LVMH, Walmart, and BMW.
VET vs. VTHO
Unlike many other blockchains, VeChain has two cryptocurrencies. The main one, known as VET, is the payment currency of the VeChain ecosystem. VeChain is the more popular of the two and has a market cap of over $2.5 billion.
The other coin is known as VeThor Token. It is generated using VET. and is used by companies to track their products through the supply chain. It has a total market cap of just $104 million. So here are some of the reasons why we think VeChain is a good investment.
Over the past few months, the VeChain price has not performed well. After hitting an all-time high of $0.2842 in April 2021, its price has fallen over 87% to the current $0.034.
Great market opportunity
The first main reason why VeChain is a good investment is that it runs one of the biggest industries in the world. Although difficult to estimate, the supply chain market was assessed to over $15.8 billion. The industry is expected to more than double in 2026 as the industry gets more complicated. Think of the tensions in the supply chain due to the Covid-19 pandemic and the war in Ukraine.
Therefore, it is likely that more companies will adopt the platform in an effort to simplify or solve some of their biggest challenges. Fortunately, the number of partnerships continues to grow.
Some of the major companies using VeChain are DB Schenker, Kuehne & Nagel, Bright Food, Fashion for Good, Haier, and Norway in a Box, among others. As they become more successful, chances are that more companies will adopt its use.
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VeChain is adopted by developers
The other reason why VeChain is a good investment is that the ecosystem has been embraced by developers building all types of apps. This situation was made possible by the cat that VeChain has smart contract functionalities that allow to create applications. There are now many publicly available applications that have been created using VeChain technology.
For example, VeChain was used to create Buy me a Coffee, a simple platform that allows organizations and users to support each other through VET. It was also used to build Vexchange, a decentralized exchange. It has also been used to build projects in the NFT industry like OceanEX, NFT Paper Project, VeGhost NFT, and VeHashes, among others. Although most of these projects are small, they are likely to bounce back in the long run.
VeChain is very popular
Another main reason why VeChain is a good investment is that it is very popular among investors and traders. Obviously, this popularity has dropped sharply recently due to its performance. However, there are still many people who still hold it in their wallet.
According to VeChain Stats, the number of VeChain blocks has grown to over 12.1 million. This is a significantly high amount. At the same time, the number of VeChain addresses jumped to over 1.78 million people. And despite the coin’s performance, VeChain’s mainnet activity volume has been somewhat stable.
VeChain is cheap
Moreover, VeChain is a good investment because it is a bit cheap. For one, the price is down more than 80% from its all-time high and is currently trading at the lowest level since February 28. This decline has left a coin trading at a significant discount. Historically, bear markets do not last forever. Therefore, its price is likely to rebound.
Finally, VeChain continues to grow even though the price of coins is struggling. For example, VeChain has signed multiple partnerships with some of the biggest companies in the world. For example, it has partnered with Direct Import Goods, PriceWaterhouseCoopers and Renault. These partnerships should continue to grow.
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Is VeChain a good investment? 5 reasons
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