What is VeChain (Does VeChain have potential)?

What is VeChain? VeChain is one of the most prominent technologies in the blockchain field. VeChain’s architecture is similar to many other blockchain projects, but it has its own characteristics: first, it conducts transactions under the premise of decentralization; second, it makes choices between scalability and security, and provides a higher degree of control while ensuring data privacy. VeChain adopts a new consensus algorithm called Proof of Stake (POA), which is a method of verifying the network state by verifying the rights of block producers. (coindesk)

Does VeChain have potential?

Editor’s note: This article is from the Wind and Fire Wheel Community (ID: FHBT18) and is authorized to be reposted by Peipei, the author, on Odaily Star Daily.

Hello everyone, I am Pei Pei. In the bear market of cryptocurrencies last month, I saw a term called “VeChain.” This term is similar to what Bitcoin and Ethereum mean to the cryptocurrency circle, which is “In the blockchain world, there are two layers of networks, a mainnet and another sidechain.” I think this statement is a bit far-fetched because in a sense, it refers to decentralization, which is also very logical for the concept of trustlessness. Can VeChain really solve the pain points of many blockchain projects? Firstly, it should be clear that “VeChain” is not a simple single public chain but a multi-chain structure alliance-level system. In other words, it can meet the needs of various applications and have cross-industry and cross-domain applications. However, it does not have a unified value standard, which makes it unable to completely replace most of the public chains currently. Furthermore, if we want the entire ecosystem to operate more effectively, we still need to use some technical means, such as consensus algorithms, to achieve development and maintenance without relying on any intermediaries. This can prevent extreme situations from occurring:

1. Slow transaction processing speed;

2. In terms of data security, since only a few users use the platform, it is difficult to ensure that billions of transactions can be processed every second. In this state, only a few hundred blocks can be confirmed. Therefore, relying solely on node communication does not have sufficient security capabilities. This is why more and more projects on the market are trying to combine their business models with other public chains.

Of course, there are also many issues to consider: whether VeChain has truly achieved the vision of decentralization, how VeChain may develop in the future, and prospects for the future. Can it become a truly decentralized global infrastructure? These are currently relatively vague questions. However, if we simply regard blockchain as a distributed database or something similar to IPFS, then who is the better solution? I think the answer is simple: VeChain itself does have certain limitations. For example, it is just built based on underlying architecture, rather than being a scalable protocol or a smart contract platform. Its design concept is mainly to improve TPS and throughput performance and provide many different functional components and services. For example, VeChain has launched DApp aggregator, wallet, DEX, and other products, as well as some other innovations such as in the payment layer, not only providing cheap and efficient data transmission methods, but also helping companies manage supply chain finance business and even providing real-time settlements for banks and other financial institutions. All of these can be done by supporting IoT devices, which is called “fully open-source software.” However, not all operations can be directly deployed on VeChain, which also limits its actual implementation scenarios to some extent.