VeChain (VET) overhauls tokenomics with reward-driven model

Layer 1 platform VeChain has upgraded its tokenomics with new incentive models designed to improve user participation and enhance the blockchain’s incentive systems.

The rewards aim to profit stakeholders and promote active engagement within the VET ecosystem.

According to the blog:

This model better incentivizes those who actively contribute to network security by acting as Validators or Delegators.

The overhaul prioritizes rewards to increase VET’s utility and bolster the project’s appeal for mass adoption.

VeChain’s upgraded tokenomics

The historic overhaul includes special staking incentives for VTHO, which delegators and validators will receive exclusively.  

In VeChain renaissance, VTHO is exclusively earned as a staking reward by Validators and Delegators and is no longer generated at the rate of 0.000432 per VET per day.

The move eliminates idle VTHO tokens from exchange wallets or inactive participants, solving a crucial tokenomics problem that leads to diluted rewards without benefiting the network.

Moreover, the new model will reduce VTHO inflation by 72.2%.

It attains that by generating VTHO according to an issuance curve correlated with “VET staked across all Delegator and Validator Nodes.”

The project predicts VeChainThor’s yearly inflation (including VET/VTHO) starting at 0.6% and hitting 2.9% if staked VET surges to 60 billion tokens (70% of VET’s total supply).

The new tokenomics promise more benefits for early stakers.

Furthermore, the VeChain 2.0 upgrade increases VTHO token burns to ensure scarcity.

The new model will remove all transaction fees to enhance VTHO’s deflationary nature.

The new gas fee market transforms VeChain’s transaction pricing approach by optimizing fees to ensure a balanced network load.

That adds to the deflationary mechanisms by heightening VTHO consumption.

Further, the gas fee market allows individuals to ‘tip’ block producers to prioritize their transactions.

Participants will receive all tips as block incentive bonuses in Staking Nodes.

Staking NFTs: the new reward-generating method

Staking non-fungible tokens is the new method of earning rewards in VeChain rebirth.

Users who participate in securing and decentralizing the network will receive protocol-level NFTs as incentives.

VeChain’s transformative 2025 roadmap

VeChain outlined its transformative expedition this year in a blog post.

The team confirmed prioritizing the VeChain Renaissance program to improve the VET ecosystem through enhanced tokenomics, interoperability, and governance.

Further, VeChain co-founder Sunny Lu confirmed the project’s plan for 2025.

He revealed three strategy structures of focus in the next twelve months – VetBetterDAO, VeChain Renaissance, and VeWorld.

That shows VeChain’s dedication to building a massive infrastructure, creating advanced applications, and incorporating them into a centralized center.

That will encourage mainstream by tapping cryptocurrency and non-crypto individuals.

VET trades at $0.03217 after a slight gain on its 24-hour price chart.

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