VeChain is no doubt one of the coins that make it on the watch list of every crypto investor because of the compelling underlying project that it represents. VeChain was founded in 2015 with the mission to leverage the potential of blockchain technology to disrupt and improve supply chain management. In its whitepaper, VeChain described that it aims to develop a trust-less business ecosystem that will facilitate the flow of information as well as high-speed value transfer and efficient business collaboration. The promise was to eliminate the limitations of traditional supply chain logistics and to pave the way for easy integration with IoT (internet of things). VeChain quickly gained traction in the investing community because of its practical use cases. The project managed to form partnerships with multiple major corporations within a few months, something that is very unusual in the crypto world. Initially, VeChain functioned on the Ethereum platform, but in 2018, it transitioned into its own blockchain platform, VeChain Thor. This transition signalled that VeChain was moving its focus beyond the supply chain into a global public blockchain that would support the development of enterprise-level decentralised apps to solve real-world problems.
The VeChain Thor platform has two tokens: VeChain Tokens (VET) and Thor Power (VTHO). VET is the token used to settle transactions on the platforms while VTHO is essentially the ‘energy’ that allows users to run applications and smart contracts. It is VET that is available for trading by the general public. It is also important to understand why the two-token system solves a major pain in the crypto industry. In other cryptocurrencies, such as Bitcoin, higher prices usually translate to higher transaction costs. But in VeChain, VET prices can appreciate but the underlying costs still remain the same. This cost predictability makes VeChain one of the most viable blockchain platforms for enterprise application. The solutions provided by the VeChain platform, such as asset digitization, proof of audit, proof of origination and proof of publication, can be applied across a variety of industries such automobile, food safety, wine, fashion, and CO2 emission reduction, among others. There is also the VeChain Foundation which is responsible for technological research and development as well as business development. The foundation has been instrumental for the quality partnerships VeChain has managed to form with not only multinational corporations but also governments around the world.
How Can I Trade VeChain (VET)?
VeChain is a popular cryptocurrency whose underlying blockchain platform has already attracted impressive partnerships that practically guarantee a more than promising future. VeChain held its ICO in August 2017 with the token trading as VEN. VEN was swapped for VET when VeChain moved into its own blockchain platform. There has always been a series of news that have marked major milestones in the VeChain project, with investors reacting accordingly to influence the prices of VET. The VeChain ICO was conducted on the Ethereum platform where 200000ETH was raised, an equivalent of about $60 million at the time.
When you invest in VET, you essentially invest in the potential current and future success of the VeChain project. The demand for the use cases of VeChain platform will no doubt have an impact on the price of VET. The partnerships formed by VeChain as well as all the potential applications across various industries must, therefore, be taken into account when you decide to buy VET. Investors that trade VET has always watched out for such updates to decide on whether to buy or sell VET. This news following strategy has been applied since the ICO on the Ethereum platform when it was announced that the new project had already secured an incubation slot with consulting giant PwC (PricewaterhouseCoopers). The project has also enlisted strategic partnerships with DNV GL, China’s National Research Consulting Centre and Japan’s BitOcean. Some of the other notable partnerships include automotive giants BMW Group and Renault; luxury goods giant LMVH; Bright Food; and Invest Cyprus. When VeChain announces such partnerships, investors who trade VET attempt to assess the potential reach and commercial value that would be derived if any meaningful traction is achieved. If there is a quantifiable lucrative opportunity, investors will pile orders to buy VET; but when there is little to no enthusiasm about a partnership, traders may be inspired to sell VET.
But like any financial asset, the price of VET is also determined by other factors beyond individual fundamentals. VET price action also takes the cue of THE Bitcoin price direction like other cryptocurrencies. This means that rising Bitcoin prices trigger demand for VET, and vice versa. The most important thing to note is that in most cases, VET prices overshoot Bitcoin when a directional cue has been provided. For instance, a 30% rise in Bitcoin prices can trigger a 100% jump in VET prices.
Where to Buy VeChain (VET)
If the VeChain project excites you, you may want to profit from it. But due caution must always be taken when buying crypto coins such as VET. For their safety, investors must always ensure that they only deal with reputable companies when they wish to buy, sell or trade VET.
Buying VeChain (VET) from Exchanges
Cryptocurrency exchanges are marketplaces that allow investors to trade digital coins (buy or sell cryptocurrencies). In most exchanges, investors may be required to first buy Bitcoin or Ethereum before exchanging them for an equivalent amount of VET tokens. When you buy VeChain through an exchange, you get to own and store the VET tokens in your assigned crypto wallet. Investors should always ensure that their wallets are well secured so that they do not lose their coins. VET holders also get to automatically receive some VTHO tokens as part of the VeChain two-token systems. This is one of the advantages of buying VeChain through an exchange. As well, investors will also qualify for any additional tokens in case the VeChain foundation implements any kind of fork. Furthermore, many exchanges support weekend trading, providing more flexibility to investors to trade as they wish.
But there are some disadvantages investors must accept when they buy or sell VET via an exchange. Crypto exchanges are relatively new types of businesses and they have been known to face some security challenges, such as hacking. In term of price changes, investors who trade VET on an exchange can only make profits when the prices appreciate. When prices fall, investors incur losses. Even when prices rise, the banking system in most exchanges is very inefficient and may inconvenience any investor that wishes to enjoy his/her profits. There are no direct cash out systems and investors may first be required to exchange the VET tokens for Bitcoins or Ethereum. For the more experienced investors who may require adequate charting tools to make appropriate trading decisions, there also may be some disappointment with the basic buy/sell platforms offered in most exchanges.
Buying VeChain (VET) from Brokers
Brokers are companies that allow investors to trade crypto CFDs (contracts for difference) via an OTC (over the counter) market. When you trade VeChain as a CFD contract, you do not own the VET token and cannot qualify for the allocation of VTHO. A CFD contract is an agreement between the investor and the broker to pay the difference between the entry and exit price of the underlying asset. This means that investors can trade VET and earn profits in both rising and falling markets: when prices are appreciating, buy VET; when prices are falling, sell VET. This is one of the major reasons why investors trade VET and other cryptocurrencies as CFDs. There is also leverage, which allows investors to gain the maximum advantage of their capital. Leverage ensures that investors can control bigger VET positions by only placing small margin capital. In an inherently volatile market, leverage can magnify potential profits further. Unlike exchanges, Crypto CFD brokers have been around for quite a while and all reputable firms feature superior trading platforms that have advanced charting as well as handy tools and resources that can help investors perform efficient price analysis on VET. Additionally, CFD brokers operate efficient payment processing systems which enable investors to deposit to and withdraw funds from their trading account with ease and convenience. In terms of safety, CFD brokers provide greater security to investors that trade VET or any other cryptocurrency. As providers of speculative financial products, brokers are subject to a greater degree of regulatory oversight both in their local jurisdiction as well as in the international space where they must adhere to various anti-money laundering guidelines. This ultimately ensures that investor funds are secured.
However, when trading VET CFDs, investors must be wary of the danger of leverage. While it boosts profits, leverage can, in the same way, amplify losses when investors make a wrong prediction.
How Will VeChain Evolve?
From every angle, the future looks bright for VeChain. This is a project that has always been in the ascendancy since it launched. Unlike many crypto projects, VeChain has a working product and has consistently announced big partnerships that have global reach and impact. The supply chain disruption potential is huge, but VeChain’s scope for the future is even wider. The VeChain blockchain provides the platform for various decentralised apps that integrate with the actual business ecosystem to be developed. This also means that ICOs can be launched on the VeChain platform. VeChain has also already trialled IoT solutions in supply chain management and is well-positioned to be the best blockchain provider in the era of Internet of Things.