Is VeChain a good investment in 2024?

Vechain remains a top 50 cryptocurrency after being founded back in 2015. But is VeChain (VET) a good investment still in 2024? Learn about VeChain in our guide.

What is VeChain?

VeChain is a blockchain platform focused on optimizing supply chain management and business operations. It aims to simplify these processes by leveraging distributed ledger technology (DLT). The platform comprises two main tokens: VeChain Token (VET) for value transfer within the network, and VeChainThor Energy (VTHO) as the fuel for smart contract transactions.

How does VeChain work?

The VeChainThor blockchain platform is positioned as a public blockchain geared towards widespread business adoption. It operates on a two-token system, consisting of VET and VTHO.

VET, or VeChain Token, serves as the currency for transactions within smart contracts on VeChain's dApps. It is publicly available for investment. VTHO, known as VeChainThor Energy, fuels transactions on the VeChain network and correlates with the cost of conducting transactions.

This dual-token structure was devised to establish effective governance and a predictable economic model for developers of decentralized applications, as outlined in VeChain's white paper. 

VeChainThor employs a Proof of Authority consensus protocol, where votes are allocated based on VET holdings and identity disclosure. The system includes 101 master nodes responsible for transaction consensus, differing from Bitcoin's requirement for unanimous node approval.

The governance model mandates identity disclosure for all master nodes, ensuring accountability and reducing energy consumption compared to traditional systems. Economic master nodes serve as a check on power, with voting rights allocated based on VET holdings.

History of VeChain

VeChain was founded in 2015 by Sunny Lu, the former CIO of Louis Vuitton China, under the umbrella of Bitse, a major Chinese blockchain company. VeChain set itself apart from other projects by attracting a significant clientele of established companies, establishing its foothold in the blockchain industry.

Initially operating on the Ethereum blockchain, VeChain underwent a significant transformation in 2018. It migrated to its own blockchain and rebranded as VeChainThor (VET).

VeChain's core objectives, as outlined in its white paper, revolve around revolutionizing supply chain management by promoting data transparency and actionable insights.

As well as this, the platform aims to excel in dApps and ICOs and facilitate seamless interactions within the IoT.

VeChain has forged strategic partnerships with notable entities, including PricewaterhouseCoopers (PwC), where VeChain's blockchain solutions enhance product verification and traceability for PwC's clientele. In the automotive sector, VeChain teamed up with Renault, alongside Microsoft and Viseo, to develop a secure digital car maintenance log. Through these strategic alliances, VeChain continues to make strides in the enterprise blockchain arena, poised to redefine industry standards.

Is VeChain a good investment?

VeChain stands out among other projects due to its utility and adoption through strategic partnerships and has historically been a popular investment for crypto investors with a market cap of more than $3.1 billion at the time of writing. However, the current price of around $0.04 is far below the all-time high of $0.27, following a 30-month slump throughout the poor market conditions. It’s worth noting no cryptocurrency went through crypto winter unscathed, but VeChain has been slower to recover than some other tokens.  

Read next: Is crypto a good investment?

How high can VeChain go?

Experts predicting a positive future for VeChain predict VET token price could sit between $0.70 and $1 in the next five years.

Is VeChain dead?

VeChain remains a top 50 cryptocurrency by market cap with a daily trading volume of more than $60 million, so it’s far from dead. But many investors feel like the project is unlikely to recover following the brutal bear market and complain that the centralized governance is stifling further development.

How many vet tokens will there be?

VET has a maximum supply of 86 billion tokens, with a circulating supply of 72 billion.

How to earn VeChain rewards

You can earn VeChain rewards by staking, albeit with relatively modest rewards compared to other PoS cryptocurrencies.

It’s easy to stake VET, just deposit your VET tokens to a supported wallet like Atomic Wallet and your funds will be automatically staked and you’ll start earning VTHO.

While rewards are generally a low rate, there are different tiers. With enough VET tokens your VeChain wallet will count as an economic node and qualify for additional rewards.

Alternatively, you can opt to stake VET via exchanges like Crypto.com and Binance. Unlike staking through a wallet, these exchanges often pay out rewards in VET tokens rather than VTHO.

Read next: What are the best staking platforms?

Tips for investing in VeChain

Before diving into VeChain investments, exercise caution and diligence with these tips:

1. Research thoroughly: Understand VeChain's tech, market position, and competitors.

2. Assess risk tolerance: Gauge your comfort level with risk.

3. Seek advice: Consult financial pros or industry experts for insights.

4. Diversify: Spread investments to balance risk and returns.

5. Stay updated: Monitor VeChain's progress and industry trends.

While VeChain holds promise with its technology and partnerships, informed decisions demand research, risk assessment, and ongoing vigilance aligned with your unique investment goals.