This is part 2 of a series. Read the introduction here for more information on how it all started: https://medium.com/realitems/realitems-org-48fcd76d2ae
When we started investigating VeChain, we were happy to discover that there is an immense amount of information out there. If you like reading documentation, you are most definitely in luck. VeChain’s Github Repo has tons of information and documentation that provide informative and in-depth information and knowledge about the project and ecosystem. Another great resource is this one-page index on the VeChain World site, which contains URLs to a broad range great resources.
If you are like us, examples are key to quickly understanding new concepts. Especially, when it comes to new technology like blockchain and cryptocurrencies. Unfortunately, being early days for VeChain, there are not a lot of examples out there. This slowed our progress and development down quite a bit, and we spent a lot of time being stuck on a particular problem until we were able to figure it out. Fortunately, being early days for VeChain, we were able to ask the core devs directly for help when we got stuck. This is one of the great things with the Vechain, the fact that we are all in this together and want the entire ecosystem to thrive and provide value. The Vechain/Thor Gitter channel was critical for our understanding of the finer points of Connex and Builtins, that ultimately led us to overcome our obstacles and point us in the right direction.
As we continued our journey into the Vechain ecosystem, a picture began to emerge. As it turns out, VeChain is very similar to Ethereum. In fact, VeChain is a fork of Ethereum which provides several advantages for us. For starters, our knowledge of Ethereum served as a solid base for understanding VeChain. With our knowledge of how transactions work in Ethereum, it was not much of a leap to understand how transactions work in VeChain. Both are distributed ledger technologies (DLT), both use Merckle trees, both have a consensus algorithm and both have transaction fees on their networks. Moreover, both systems use Solidity and Vyper for writing smart contracts, while using the same formats for private and public keys. The bulk of your dApp client code can probably be used on both systems, and if you are familiar with Geth or Parity, you will be able to get a Thor node up and running in no time.
As we discovered during this process, there are also some key differences between the two blockchains. For instance, Ethereum has one coin: Ether (ETH). Essentially, the price of gas is tied to the price of Ether. If Ether is expensive, gas is expensive. By contrast, VeChain has a two-coin system: VET (currency) and VTHO (energy). VET is used as a store of value and smart payment currency. VTHO is used to pay for transferring tokens and executing smart contracts on the Vechain blockchain. The price of Vet and Vtho are decoupled, which means that transaction costs are not tied to the ups and downs of the market.
Another major difference between the two is the consensus algorithm. Ethereum uses Proof-Of-Work (PoW) system and is decentralized — architecturally and governmentally. Anybody can run a node and become a miner — no permission is required. The number of nodes competing to create blocks and add them to the chain is meant to be ever-changing. The same is not true for VeChain. With VeChain, there are exactly 101 “mining” nodes — also called Authority nodes — and there is a rigorous process for becoming the owner of one of these nodes. Consequently, VeChain is not completely permission-less and not completely decentralized. Without going in-depth into the centralization vs. decentralization debate, we will just say that both systems have their strengths and weaknesses. If you require complete decentralization, VeChain may not be for you. On the other hand, VeChain’s relative centralization means that VeChain has the ability to move quickly. After the VeChain stakeholders have voted on changes, both hardware and software updates are mandatory. That means more control over transaction throughput and feature progression in the future. Look to see VeChain move way ahead of Ethereum in the next few months and years.
In Part 3, we will discuss the key features that sealed the deal on our decision to make the leap to VeChain.
Thanks for reading!
The Real Items Team