Transparency, Fairness, Openness
With the purpose of fostering transparent communication on our accomplishments on creating tangible economic value by blockchain technology, we hereby present the 13th VeChain Foundation Financial Executive Report, covering the period from August 2020 through to October 2020.
As always, we sincerely welcome the community to hold us to the commitment of transparency, including but not limited to the rigorous monitoring and usage of our funds, and the development process of all aspects within the VeChain Foundation.
The report structure is as follows:
1. VET Supply Overview
2. VeChain Foundation Expenditure (use of proceeds)
i) Enterprise Investor Pool
ii) Co-Founders, Development Team
iii) The Operation, Technological Research and Development
iv) Business Development
v) Compliance & Legal
vi) Ecosystem Development
As of Oct 31, 2020, the circulating supply including soft-lockups (i.e. 64,968,961,033) slightly increased by 118,512,910, or 0.16% compared to the last reporting period. Within the VET circulating supply, 20,769,453,627 VETs were held in soft-lockups, totalling 24.16% of overall supply. Hence, by the end of this reporting period, around 51.4% of the VET total supply is free for trading on the open market.
* The soft-lockup categories are as follows:
- Authority Masternode collateral — each Authority Masternode keeps at least 25 million VETs
- X Nodes staking — each X node keeps a minimum amount of VETs based on four different tiers
- Economic Nodes staking — each economic node keeps a minimum amount of VETs based on three different tiers
- Team Lockup — According to the whitepaper, 5% of the total VET supply is allocated to co-founders and development team, as of Oct 31, 2020, over 3 billion VETs have been locked up by the team to show the commitment to VeChain’s long term success
- *The ecosystem reserve was acquired by the VeChain Foundation on the open markets. This reserve will be used to facilitate the long term growth of the VeChain ecosystem. VeChain Foundation is evaluating institution level custody service, and the reserve will be deposited into the custody and disclosed when the custody service is available.
We summarized below the USD value of the expenditure in fiat or BTC/ETH for the reporting period. For the spending in BTC or ETH, the USD value was booked based on the rate when the transaction occurred. In many situations our service providers and partners prefer to receive VET as direct payment or investment compared to using fiat or BTC/ETH. Therefore, the total expenditure for operation, technological and business development comprises a combination of direct VET payment and use of proceeds (fiat, BTC/ETH) depending on the associated parties’ preference.
Given the impact of COVID-19 and the related economic turmoil, no enterprise investor was accredited during this period.
In accordance with the initial incentive plan, the Foundation has finished the entire 12 phases of quarterly rewards to the team. As usual, the entire executive team continued to lock up 100% of their rewards, and some of the team members opted to lock up their allocated tokens to show the commitment. There has been 3 billion VET that has been locked up by the team.
During this period, there have been some notable improvements announced to the public, highlighting our great efforts in R&D which have resulted in some huge technological achievements, illustrated as follows:
- On August 20, the VeChain core dev team released a maintenance release v1.3.5 that contains several features and performance improvements.
- On September 8, VeResearch team released an article titled “SURFACE (PoA 2.0): Better Performance, Uncompromised Security and a Dual-Consensus Model” to dive deep into PoA 2.0 algrithm, which delivers both performance and security. PoA 2.0 is proposed to meet the demand for better performance and security due to the ever-growing number of enterprise applications running on VeChainThor Blockchain.
- On September 16, VeChain core dev team released a new proposal VIP-201 to enhance the fee delegation feature on VeChainThor Blockchain, which specifies the protocol between two parties who wish to conduct a designated gas paying process described in VIP-191. Once implemented, VIP-201 will improve the standards and speed of on-chain transactions.
- On September 24, VeChain core team has released the v1.3.6 Thor software update to improve mainnet performance.
During this quarter, the Foundation has seen more opportunities for high-impact business applications in various industries. With the partnership with Grant Thornton Cyprus, one of the world’s largest professional services network of independent accounting and consulting member firms, VeChain intends to pair blockchain technology with the global network of Grant Thornton Cyprus clients. After becoming an official member of the China Animal Health And Food Safety Alliance as the sole public blockchain technology provider, VeChain will be providing technical and infrastructural support for over 130 enterprise and organization member council members.
In the face of the long-term impact of the COVID-19 on the global economy, VeChain, together with DNV GL, jointly developed a blockchain-based risk self-evaluation platform named VeTrust. It combines DNV GL’s infection risk management methodology and track record to help businesses start managing COVID-19 risk factors, starting with small to mid-scale hotels in China. In addition, VET teamed with Travala.com, the leading cryptocurrency-friendly travel booking platform, integrating VET as the payment accommodation options for over 230 countries and 2.2 million hotels.
Announced partnerships and collaborations (May, 2020 — July, 2020)
- Grant Thornton Cyprus (August 17)
- Travala.com (August 19)
- China Animal Health And Food Safety Alliance (September 17)
Highlights from the business development and marketing events (May, 2020 — July, 2020)
- Initiated by one of the leading industrial media platforms, Mars Blockchain, The POW’ER 2020 Shanghai Summit was held from August 11 to 12 in Shanghai. The two-day event aims to conduct an in-depth discussion on blockchain technology applications, encryption methodology, and financial innovation, and also explore the collision and integration of blockchain with 5G, artificial intelligence and other cutting-edge technologies. Sunny Lu, co-founder and CEO at VeChain, gave a keynote speech on “The Last Mile of The Mass Adoption of Blockchain Technology’’. (August 11–12)
- Sunny Lu, co-founder and CEO at VeChain, was invited to deliver a keynote speech at the “Unlocking New Opportunities for ‘Tongue Safety’ Digitalization” forum held at PwC Shanghai Innovation Center. During the roundtable session, Sunny Lu discussed blockchain innovation in the food industry with government representatives, industry leaders and other guests. The forum aims to explore new digital industry opportunities such as blockchain traceability, supply chain visualization, anti-counterfeit and controllability to help build food safety and enhance consumers’ safety. VeChain shared its own landing cases and successful experiences. (August 13)
- VeChain attended Blockchain in China: Applications and Opportunities held by British Chamber Shanghai Office. Sunny Lu (Co-founder, CEO of VeChain) and CY Cheung (Partner, Cyber Security and Innovation at PwC) dived into real cases by discussing the key factors for the mass adoption of blockchain technology, as well as sharing experiences in the blockchain deployment, integration and usage for various business scenarios. They also shed light on the opportunities and challenges of applying blockchain in the COVID-19 era. (September 1)
- As one of the main Blockchain Conferences in Europe, European Blockchain Convention was successfully held on September 21 and 22. Sunny Lu, co-founder and CEO of VeChain, was invited to give a speech on “Smart Cities, Smart Mobility: Showcasing Tomorrow”. The panel was joined by guests from Mobility Daimler and Bosch Global. Sunny shared insights on blockchain-enabled mobility as a service and further potential of blockchain deployment in the future. (September 21)
- BMW invited VeChain to its BMW IT Innovation Keynote 2020. During the live streaming event, the BMW VerifyCar dApp was showcased to BMW Group associates. Full BMW lifecycle tracking based on VeChain was mentioned. (September 23)
- VeChain attended the exclusive industry event held by TechNode, with the theme of “Is Blockchain The Answer To Food Safety”. The business project manager of VeChain shared our industry leading technology to VIPs and key stakeholders in the food safety industry. (September 24)
- Sunny Lu, co-founder and CEO of VeChain attended the LA Blockchain Summit and joined the panel named Application Base Of Distributed Ledger Technology In China. (October 6)
- Shanghai Fashion Week SS2021 will be held from October 8 to 16, during which time R.I.S.E. Sustainability Lab will be hosting an exclusive event Mode Talk to dive deep into the green production and design of the industry. VeChain is invited to attend the “Redefine The Post-COVID Value Driver of Fashion Industry’’ panel and present the success of blockchain solutions in this sector to explore more potential of further adoption. (October 11)
- Jason Rockwood, General Manager of VeChain Americas, attended an industry webinar “Blockchain — Evolution of Supply Chain Management” held by BrightTALK, to share supply chain issues/challenges tackled, lessons learned and how traceability solutions powered by VeChain were deployed in the real world. (October 20)
- The 9th episode of VeChain BootCamp was successfully held October 22, 10:00 PM UTC+8. Peter Zhou, Chief Scientist at VeChain, Zhijie Ren, Senior Research Scientist (Blockchain) at VeChain, joined by Ning Wang from the Mathematical Institute at University of Oxford to, expand the discussion around their recent research achievements, especially in AlphaBlock theory. (October 22)
- The Delegation of Cyberspace Administration of China, with representatives from Beijing and Shanghai, conducted an exclusive panel in the VeChain office and sat down with the VeChain team to discuss the blockchain deployment in real world scenarios. Sunny Lu, co-founder and CEO of VeChain made a detailed analysis of our enterprise-level blockchain applications in safety & risk management, food safety, and sustainability, which was well-received by all guests. (October 22)
- During the International Shanghai Blockchain Week 2020, PANews held an themed panel “Center of Crypto Market: NFT Is More Than Digital Art”. Noah Huo, Community Operation Director of VeChain, attended the event. Joined by prominent individuals in the NFT/blockchain industry, he gave a speech titled “How public blockchain embrace the rise of NFT” and talked about VeChain’s superior technology for NFT and dApps. (October 26)
- Sunny Lu, co-founder and CEO of VeChain, together with John Dempsey, co-founder and CEO of VIMWorld, conducted an interview through the crypto.com YouTube channel. He spoke about the advantages of VeChain in terms of technical security and stability, and the professionalism to combine the technology with business. (October 26)
- Sunny Lu, co-founder and CEO of VeChain attended one of the most attractive industry events in Asia, Shanghai International Blockchain Week, and gave a keynote speech on the potential of the Blockchain+IoT solutions. VeChain continues to lead the digital transformation and mass adoption for the $3 trillion Blockchain+IoT market. (October 28)
VeChain hires professional service providers in cybersecurity and legal to address a confluence of regulatory and business changes that are putting demands on compliance. The increasing collaboration of VeChain with government-backed alliances and projects further proves the security and compliance of VeChain solutions, which we believe is the prerequisite of mass adoption by global enterprises.
On August 16, The VeChain Foundation announced the top 10 entries of the VeChain Design Contest. By using VeVote, the community has determined the final Top 5 winners to share a total prize pool of 3,000 USD.
In order to provide better support for community developers and improve the quality of contributions incorporated participation, the Foundation team has adhered to the Foundation Grant Program and bounty program, which was being implemented with increasing closer communication with our community. Besides incentive programmes, we are also working with consultants to approach for more resources to create diversity in ecosystem productivity. The team continues to evaluate projects and keeps productive discussions with several teams.