VeChain Foundation is preparing 2022, with the possibility of a major announcement. Their official Twitter handle reveals more information about the organization. hintedat the release of an additional native stablecoin, VeUSD.
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The Foundation little details on this new product but announced its followers that it’ll be “something special (…). Something that will allow us to take VeChainThor to the next level in multiple ways”.
The stablecoin VeUSD will be a tool to “unleash” DeFi capabilities for the VeChain ecosystem. According to the official blog, this digital asset is designed in line with the core principles of the ecosystem, which include sustainability, versatility and scalability.
VeChainThor, the blockchain VeChainThor appeared to be preparing for this new DeFi era for some time. NewsBTC stated that the network was updated three months prior to the approval of the Proof-of-Authority vote.
Designed to support a “new wave of blockchain mass adoption”, according to the VeChain Foundation, the update was supposed to mitigate any tradeoffs on the consensus layer for the blockchain VeChainThor. According to the VeChain Foundation, at the time:
(…) the VeChain Research and Development teams have been working on a massive upgrade of the VeChainThor blockchain called SURFACE (PoA 2.0), standing for a Secure, Use-case-adaptive, Relatively Fork-free Approach of Chain Extension.
VeUSD might be the first product to take advantage of this new blockchain technology after it is updated.
VeChain’s Own Stablecoin, Potential Benefits And Concerns
VeChain celebrated the news. Recently, a user called “EffortCapital” proposed the possibility for the Foundation to create an algorithmic stablecoin, such as LUNA with VeThor Energy (VTHO) as collateral.
It creates an equivalent to the Colombus-5 upgrade’s burning mechanism in Terra. The mechanism helps to ensure that the asset is always in demand and increases its value.
For a proposal #VechainFund to establish an algorithmic stablecoin that is backed by $VTHO seignorage style (like LUNA).
More VUSD demand -> burn VTHO -> value accrual to $VET@PeterZh47977516 @sunshinelu24
— D⚡️ (🏌🏻,⛳️) (@EffortCapital) December 30, 2021
Sunny Lu (CEO at VeChain) was interested in this idea. He reached out to the community via Twitter and asked for ideas for tokenomics designs.
However, the Foundation’s announcement of a stablecoin is not universally accepted by everyone. VeUSD is believed to be a stablecoin that could transform the ecosystem. It would replace VTHO which was used for transactions on the blockchain.
Other straight out said that the Foundation and the blockchain has “failed to fulfill their core products”. Although the network was implemented in corporate supply chains, it has not been focused on creating a DeFi ecosystem.
As mentioned above, this approach is changing with new upgrades and DeFi-related products. Most users seemed to view the announcement, despite the negatives.
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While the Foundation is expected to share further details, speculation at this point will remain. VET traded at $0.085, with a 1.95 percent loss over the previous day as of press-time.
