Understanding VeChain's utility token, VET
| VET Characteristics | Details |
|---|---|
Type | Native Coin |
Precision | 18 decimal places |
Total supply | 86,712,634,466 |
Native Coin: The Backbone of VeChainThor
A native coin is the primary cryptocurrency inherent to a specific blockchain network. As VeChainThor's native coin, VET serves as the fundamental unit of value and plays multiple crucial roles within the ecosystem:
Medium of Exchange: Facilitates value transfer within the network.
Store of Value: Acts as a digital asset that can appreciate or depreciate in value.
Utility Token: Enables access to various features and services on the VeChainThor blockchain.
Governance Mechanism: VET holders can participate in network governance decisions.
VET's High Divisibility: 18 Decimal Places
VET's high divisibility, with 18 decimal places, offers several advantages:
Micropayments: Enables extremely small transactions, crucial for many blockchain applications.
Precision: Allows for exact value representation in various use cases.
Scalability: Supports a wide range of transaction sizes, from tiny micropayments to large transfers.
Future-proofing: Provides room for value appreciation without limiting usability.
The smallest unit of VET, similar to Bitcoin's satoshi, is called 'wei': 1 VET = 1,000,000,000,000,000,000 wei (10^18 wei).
This high divisibility makes VET particularly suitable for:
Internet of Things (IoT) applications
Micro-incentivization in sustainability initiatives
Precise value allocation in complex supply chain scenarios
Total Supply: Fixed at 86,712,634,466 VET
The total supply of VET is fixed, meaning no new tokens will ever be created. This fixed supply model offers several benefits:
Scarcity: Creates a deflationary aspect to the token economics.
Predictability: Allows for more accurate long-term economic modeling.
Transparency: Provides clarity to users and investors about the token's distribution.
Value Proposition: Can potentially drive value appreciation as demand increases against a fixed supply.
Implications of a Fixed Supply
Long-term Value: As adoption grows, the fixed supply could lead to appreciation in VET's value.
Economic Stability: Prevents inflationary pressures that come with an ever-increasing supply.
Trust: Builds confidence among users and investors due to the predictable token economics.
By combining high divisibility with a fixed total supply, VET is designed to serve as a versatile and sustainable utility token within the VeChainThor ecosystem. This design supports a wide range of applications, from microtransactions in IoT devices to large-scale enterprise solutions, while maintaining a stable and predictable economic model.
