*obligatory not financial advice*
What is Vechain?
Vechain is a blockchain that is focusing on optimizing supply chain management. Vechain offers a way of making supply chains and logistics more transparent and efficient by sharing the entire history of a product on a public blockchain. This is done with the help of tracking devices that update the chain with all relevant data like time, location, temperature, etc.
This could help to fight counterfeiting. Designer labels and food products are often victim of counterfeiting, for example in 2013 there was a massive scandal in Europe when most beef turned out to actually be horse meat. This can happen because there is no way for you or even other businesses to really know the entire history of a product, the supply chain is simply not transparent enough. By letting a tracker automatically update a public blockchain with all important information, you could actually know for a fact that the Prada handbag you are buying actually is a $2000 Prada bag and not some cheap copy.
The end goal is to make a products history so transparent that any customer could just scan a QR-code of an item to get all information they might want. If you want to impress your date by pretending to be a wine expert you could scan the wine bottle and then act like you knew where it came from. Or if you buy groceries you could scan them to make sure they were never stored right next to a nuclear power plant. Ok that’s probably very unlikely anyway, but the point is right now you don't where your food, medicine, or any other of your consume goods come from. Of course products are getting controlled regular but technology like Vechain could optimize that and let you know your goods better.
Businesses would also profit from using Vechain because they don't need to manually handle their logistics information because all data will always be automatically up to date. This is why Vechain has many different partnerships with big companies of various sectors and its number of partners keeps growing. Just take a look their partnerships, they are a bit China heavy, but brands like BMW or H&M are using it too:
VET & VTHO
Vechain has a dual token model with two different native coins. VET is used for staking and for governance, it has a limited supply of 86,712,634,466 coins and will never have more or less. VTHO is used to pay for gas fees and is inflationary, each VET hodler is earning VTHO.
The consensus mechanism is a unique version of proof-of-stake called proof-of-authority. The Vechain founders believe that a blockchain shouldn't be completely decentralized but also not completely centralized, instead it should be somewhere between the two extremes. Proof-of-authority is their attempt at such a compromise.
New blocks are produced by Authority Masternodes (AM). The AMs are not chosen based on how much VET or VTHO they hold. Instead they are chosen by the Vechain Foundation and they chose based on how trustworthy they seem. Each masternode is doxed and has to go thru a KYC process to become an AM. There can only be 101 AMs and the blockhain choses a random one to produce the next block.
Each time a new block is produced all VET holders earn VTHO, they don't need to lock their funds for that. 70% of the VTHO used for transaction fees is burned, the other 30% is rewarded to the AM that mined the block. The number of new VTHO or the amount that is being burned can be changed by VET holders.
The value of both coins obviously depends on how much the network is being used. The more supply chain DApps run on Vechain the more demand there will be for VTHO to pay for fees, and thanks to its burning mechanism it could in theory become deflationary in times of high usage. VET too would become more valuable because it’s a source for VTHO and gives its holders some governance rights. Since Vechain has many partners already it will likely keep growing and with it VET and VTHO will grow as well.
Personally, I wouldn't buy VTHO because if you buy VET you can earn VTHO anyway. If you have some VET then make sure to move them off the exchange to a non-custodian wallet so you can earn VTHO.
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