Since 2014, Ethereum has led the way in public blockchain technology. The concept of a smart contract allows blockchain to describe more complex objects and activities in the real world, and the consensus-based computations and creation of the Ethereum Virtual Machine (EVM) that enables smart contracts.

Contrary to expectations, Ethereum is unsuited for running large-scale commercial decentralized applications (dApps). One of the key causes is the lack of an adequate governance structure from the start of Ethereum that would allow for rapid and transparent protocol modifications to address new issues or breakthroughs. Second, Ethereum lacks an economic model that allows businesses to regulate and anticipate costs. Given the volatility of the ether price, it is difficult for businesses to forecast future ether prices or the cost of maintaining a dApp on Ethereum.

The VeChainThor Blockchain addresses these issues. Its novel governance and economic models, along with VeChain’s innovative technical solutions, Vechain believes will accelerate the adoption of blockchain technology and the creation of new business ecosystems with more efficiency and trust. VeChainThor is filled with technological features designed for businesses, people, and developers.

Meta Transaction Features? What is this?

Several meta-transaction features that are native to the VeChain Thor blockchain’s core protocol, including multi-party payment, multi-task transaction, controllable transaction lifecycle, and transaction dependency, make the development process more user-friendly and thus more suitable for enterprise adoption.

• BlockRef and Expiration transaction fields allow users to control when a transaction is processed or when it expires if it is not included in a block. Controllable Transaction Lifecycle
  
• Multi-task Transaction (MTT) – Multi-function atomic transactions enable developers to batch payments, combine several calls to distinct contract functions into a single transaction, and define the order in which they should be executed in.
• User onboarding is made easier using multi-party payment (MPP). Flexible transaction fee delegation schemes allow a freemium model to be used inside a decentralized application to onboard customers with little friction.
• In order to guarantee that the execution order fits business requirements, dependencies should be defined in transaction definitions. Transactions that declare a dependence will not be performed until the needed transaction has been completed.

Proof of Authority (PoA)

When developing a public blockchain system, one of the most important considerations to make is how to construct the consensus algorithm for the system. The protocol not only specifies how blockchain users agree on the growth of the blockchain, but it also incorporates the governance model that has been imposed on the system as a whole.

Remember that the core design concept of Vechain‘s governance model is that it should be simple and straightforward.

Both absolute centralization and complete decentralization are undesirable outcomes; nevertheless, a compromise and balance between the two would be preferable outcomes.

VeChain has chosen the Proof of Authority (PoA) consensus algorithm because it is compatible with vechain’s governance model, which states that there will be no anonymous block producers, but rather a fixed number of known validators (Authority Masternodes) who have been authorized by the steering committee of the VeChain Foundation.

In order to become an Authority Masternode (AM), a person or organization must voluntarily expose their identify (and, by extension, their reputation) to the VeChain Foundation in return for the opportunity to verify and generate blocks on the Ethereum blockchain. It is the fact that their identities and reputations are placed at risk that provides all of the AMs with extra incentives to behave appropriately and maintain network security. Each AM in VeChainThor must go through a rigorous know-your-customer (KYC) process and meet the Foundation’s minimal standards in order to be eligible to participate.

The VeChainThor protocol is maintained by Authority Masternode Operators, who have a common interest in the growth of the VeChain ecosystem and adhere to the Foundation’s governance policy in this regard. PoA addresses the frequent complaints of businesses about inefficient upgrades and energy waste.

• To accomplish network security and consensus integrity, just a little amount of computer power is necessary.
• Hard forks may be avoided if the authority mastemodes fail to update since they are controlled by the smart contract that is embedded in.
• The Foundation conducts a thorough investigation into the identity of all Authority Masternode Operators.

VeChainThor’s Governance

Efficiency and transparency are ensured by striking a balance between decentralization and centralization. As the governing body of the ecosystem, the Steering Committee, which is chosen by the community, promotes decision-making and implementation, which is backed by the on-chain governance mechanism.

• The use of role-based voting helps to lessen the amount of ambiguity around the platform’s technological and organizational evolution.
• In order to support the governance model, an on-chain governance mechanism has been developed that is separated into three parts – proposal, approval, and execution.

The Economic Model

VET+VTHO are a unique two-token system that dramatically reduces the cost of utilizing blockchain while also reducing the risk of market speculation. VTHO supply and demand are monitored in order to ensure that the cost is more predictable due to the link between them and the usage of blockchain resources. In addition, the governance process of the Foundation helps to keep costs under control.

• VTHO production from any address holding VET at a predefined velocity of 5*(10-8) per VET per block from any address holding VET is possible (10s)
• 70 percent of the VTHO paid in each transaction is destroyed, with the remaining 30 percent going to the Authority Masternode Operator as compensation.
• It is possible to make adjustments to variables (such as gas price and velocity) in order to preserve the equilibrium of VTHO demand and supply

Two-token Design

In every blockchain, there are financial aspects that are intrinsic. A suitable economic model is one of the most important aspects of a blockchain ecosystem, and it is also a critical factor in the success of the ecosystem. VeChain’s business partners, particularly corporations and enterprise business owners, have informed us that one of the major barriers to adoption of blockchain technologies is the unpredictability of the costs associated with using blockchain, which is a result of the volatile nature of cryptocurrency markets.

In order to address the issue, VeChain propose a bi-token system that incorporates the VeChain Token (VET) and the VeThor Token (VTH) (VTHO). To put it another way, the purpose of VET is to act as a value-transfer medium (also known as “smart money”) in order to facilitate quick value circulation inside the VeChainThor ecosystem. However, VTHO reflects the fundamental cost of utilizing VeChainThor and will be consumed (in other words, destroyed) after all on-chain actions have been completed using the protocol.

According to Vechain’s concept, VTHO is formed by maintaining a constant speed for VET. Vechain is able to separate the direct cost of utilizing VeChainThor from the price of VET in this manner. Let V be the quantity of VET, t represent the length of time (measured in terms of the number of blocks), and u represent the pace at which VTHO is generated. It may be expressed mathematically as follows:

The quantity of VTHO created as a result of holding V VET is denoted by the symbol Egen. On the other hand, assuming that G is the quantity of Gas needed by the system to complete the transaction and that p is the gas price in VTHO provided by the transaction sender, Vechain may compute the amount of VTHO used for each transaction as follows:

VeChain Token

VeThor Token (VTHO)

Fee Delegation

Multi-Party Payment (Prototype)

Multi-Party Payment(MPP) was created from the perspective of a DApp owner who is in charge of a collection of contracts that are executing on the blockchain. Furthermore, MPP necessitates the writing of data on the chain.

Designated Gas Payer (VIP191)

Designated Gas Payer is intended to be used in conjunction with MPP in order to enable more flexibility for TX fee delegation on VeChainThor. This feature enables a TX sender to look for an arbitrary person, rather than the TX receiver, who is prepared to pay for the TX sent to him or her.

Comparison

When compared to MPP, the Designated Gas Payer (VIP-191) returns control to the TX senders, allowing them to activate the protocol. Furthermore, there are no overhead costs associated with it. MPP, on the other hand, does not need both the TX sender and the gas-payer to be online in order to complete the TX, while MPP does. Because the gas payer will have to expressly state his or her intention to finance TXs from a certain account on the chain, MPP is the more transparent of the two options in terms of transparency.

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