In brief
- VeChain has completed the second step of its “Hayabusa” upgrade, introducing a new consensus mechanism and tokenomics model.
- The blockchain platform has switched to a Delegated-Proof-of-Stake model, aiming to improve economic security, deliver greater rewards for users and introduce a more open governance framework.
- The upgrade forms part of the “VeChain Renaissance” technical roadmap.
Blockchain platform VeChain has completed the second step of a wide-ranging upgrade, introducing a new consensus mechanism and tokenomics model.
The “Hayabusa” upgrade, named after a Japanese spacecraft that overcame challenges to return asteroid samples to Earth, represents a further step towards the VeChain network’s decentralization.
VeChain has switched from its previous Proof-of-Authority consensus mechanism to a Delegated-Proof-of-Stake model, meaning the network’s validators are now “public and permissionless,” VeChain CEO Sunny Lu told Decrypt.
The aim is to boost VeChain’s economic security, deliver greater rewards for users who back the blockchain with their own collateral, and drive representation through a more open governance framework.
“Under Hayabusa, all rewards of VeChain’s gas token VeThor (VTHO) are awarded to stakers only,” Lu explained. “This increases the APY for individuals, while reducing ‘idle’ VTHO—such as that generated in exchanges—helping create a more deflationary tokenomic environment,” he added, noting that it will enhance the ecosystem’s long-term value.
VeChain’s “Renaissance”
The changes form part of a technical roadmap that the platform calls “VeChain Renaissance,” with upgrades taking place in three key stages.
These encompass updates to VeChain’s EVM model, new dev tools, reward models and tokenomics, as well as an EIP 1559 Gas market modelled on that of ETH. The “renaissance” also introduces a 100% base fee burn along with priority tips for validators.
Effective staking on VeChain is “proportionally higher,” than on Ethereum, Lu explained. Where Ethereum validators have a staking limit of 32 ETH, VeChain validators can stake up to 600 million VET per validator, all of which affects their reward weighting.
Regulatory compliance has been front of mind with VeChain’s recent changes, and the work completed as part of Hayabusa has been “submitted and confirmed” on the European Securities and Markets Authority’s register, which is part of the trading bloc’s MiCA framework.
Hayabusa marks the eighth hard fork in VeChain’s history, with the project claiming it has enjoyed 100% uptime since launching back in 2017.
“Tangible use cases”
VeChain differentiates itself from other crypto projects through its focus on “real-world utility and applications for use in everyLu life,” Lu said.
That’s borne out by the claimed 5.5 million users who have engaged with the VeChain ecosystem over the past 12 months, mainly through sustainability and customer engagement platform VeBetter—which brings together more than 50 apps that tokenize user actions and reward them for activities ranging from reducing waste, improve their health or commuting in more sustainable ways, among others.
Since 2017, over 350 business applications have launched on the blockchain, according to VeChain. Recent collaborations have seen the activewear brand Lululemon start to use VeChain’s technology in China to validate the authenticity of products—giving consumers confidence they’re buying legitimate items rather than counterfeits.
VeChain has also announced a partnership with Rekord, a company building Digital Product Passports for the EU’s digital market needs under ESPR, including sustainability and supply chains. Additional partnerships in development include projects relating to RWAs and tokenization, the platform said.
Another partnership with Ultimate Fighting Championship led to the creation of the Build Your Body app, which offers unique workouts from UFC champions and rewards fans for getting involved. UFC CEO Dana White also joined VeChain as an advisor, publicly sharing his purchase of $1 million in VET tokens.
“These, and other applications, speak to VeChain’s focus on utility for end users, Lu said, noting that, “We are proud to be pioneers of tangible use cases you can hold in your hands, beyond the purely speculative.”
Daily Debrief Newsletter
Start every day with the top news stories right now, plus original features, a podcast, videos and more.
