Transparency, Fairness, Openness
We are excited to present the fourth quarterly VeChain Foundation Financial Executive Report. This is the first financial report since launching the VeChainThor Mainnet. As such, the presented VET numbers in this report reflect the 1:100 token split. For the sake of consistency, we consider the token split when referring to VET balance and expenditures in previous time periods.
This financial report covers the period from May 2018 through July 2018. We sincerely welcome the community to uphold us to this transparency commitment, monitor the funds usage, and development process of all aspects within the VeChain Foundation.
VET Supply Overview
The VET total supply on the VeChainThor Blockchain is 86,712,634,466. By the end of July 2018, the ratio of the circulating VET supply is 65%, which is roughly 4% larger than what was reported in the previous quarterly financial report.
- Enterprise Investors — VeChain has received significant interests from enterprises, governments, institutions and others for partnership, investment, and collaboration due to what we have achieved so far. Since earlier this year, we have been talking to a few prestigious enterprise investors which we believe will make significant contribution and add value to the VeChain Ecosystem. In this reporting period, we finally entered into agreements with several major enterprise investors which have invested from this pool. While we are not allowed to disclose business contract details, all of these enterprise investors agreed to hold the VETs for long terms and are future minded. These investors are distinctly looking to contribute to and expand the VeChain Ecosystem across multiple levels.
- Co-Founders, Development Team — In this period, a total 517 million VETs were distributed as fourth quarterly rewards to the team. The distribution percentage increased slightly in comparison to the last period due to the growth in team size. Same as the previous periods, the executive team will continue locking up 100% of their rewards gained in this period for two years, starting from the moment of distribution.
- Operation, Technological and Business development — The allocated budget has been used in developing the VeChainThor Mainnet, security testing, academic research projects, market promotion, community building as well as facilitating the growth of the VeChain Ecosystem. In this period, significant security testing and bug bounties were conducted on the VeChainThor Mainnet source code, built-in smart contracts, authority masternode deployment as well as the VeChainThor Wallet application. Again, we are happy to see the increase in situations where we were presented the option to acquire goods, services and the opportunity to fund/invest in technology with VET compared to using fiat or BTC/ETH. The overall budget for operation, technological and business development comprises a combination of VET and ETH based on the situations in which funds were used. Please refer to the below sections for more detailed activities in this areas.
VEN to VET token swap status update (as of September 10, 2018)
As of September 10 2018, approximately 93.5% of the ERC20 VEN tokens have been swapped for VET on the VeChainThor Mainnet. The entire token swap process was under the inspection of an independent third party, and an inspection report will be submitted to the Steering Committee for review. As part of the token swap process, the ERC20 VEN tokens were required to be sent to unspendable addresses before the VET can be distributed, which eliminates the possibility of the ERC20 VEN token returning into the circulation.
We will continue providing the token swap service for the ERC20 VEN token holders who have not swapped their tokens via the VeChainThor Wallet application. So as long as you hold ERC20 VEN tokens on the Ethereum address controlled by you (as always recommended), VeChain Foundation will provide token swap service.
ETH expenditure details
The above table shows the ETH expenditure by category and the USD value of the ETH expenditure at the rate when the transaction occurred based on the financial accounts. In general, the total USD amount of ETH expenditure dropped, when comparing with the last period, this is mainly seen as there were more service providers and business partners who are willing to take VET as payment directly. In many scenarios we found value in giving these partners VET as to ETH as they found increased value in contributing to the ecosystem when VET was the payment token.
A summary of the expenditure in each category is as below:
- Technological Research and Development — In this period, the VeChainThor Mainnet was successfully launched. To prepare for a smooth and secure launch, the team has spent considerable hours in the internal and external testings. VeChain has engaged multiple professional third party security service providers, such as Hosho Group, Secureware and Slowmist, in testing the security of the VeChainThor Mainnet source code, built-in smart contracts, Authority Masternode deployment as well as VeChainThor wallet app. Public bug bounty programs for the VeChainThor Mainnet and wallet app have been launched on Hackenproof and Slowmist. The technology team has been preparing for the migration of enterprise solutions from the previous consortium blockchain onto the VeChainThor Mainnet, and new enterprise friendly blockchain solutions are also under development to enable enterprises to effortlessly integrate their existing systems and securely manage their private keys. In addition, a few new academic research partners have been engaged in the VeResearch program, which will be announced later.
- Business Development — In this period, the VeChain team managed to sign a few renowned partnerships which will lead to more enterprise blockchain applications on the VeChainThor Mainnet. In addition, the team has been promoting VeChain Blockchain technologies to an extended range of audience in the general high tech and traditional industries.
Announced partnerships and collaborations (May — July)
- Bright Foods and Shanghai Xiandao Food (May 16)
- Lingang International Manufacturing Exhibition Trading Centre (May 27)
- Shanghai Wine and Liquor Blockchain Alliance (June 7)
- DB Schenker (June 12)
- Totient Labs (July 10)
Highlights from the community and marketing events (May — July)
- Kevin’s speech at Consumer Rights Protection workshop held by National Market Supervision Department (May 7)
- Sarah joined in PwC Singapore innovation center opening ceremony and shared VeChain blockchain solution with Singapore finance minister Mr. Heng Swee Keat (May 11)
- VeChain sponsored Consensus 2018, Sunny and Luca joined live interview with Coindesk and Sunny spoke in a panel discussion（May 15）
- VeChain official meetup in New York (May 17)
- CFO Jay Zhang’s speech at Yicai Tech & Innovation conference (May 18)
- Sarah shared VeChain blockchain solution with Minister Counsellor of the Malaysia Trade Commission Mr. Lim Chee Hau (May 22)
- VeChain attended 2018 Viva Technology and won runner-up of LVMH Innovation Award (May 24)
- VeChain joined in 2018 Blockchain & Industry Convergence Development Forum in Shanghai (May 25)
- Sunny’s speech at China International Big Data Industry Expo 2018 (May 28)
- Jerome’s interview by Digital Business News (June 7)
- Jerome’s speech at Air Liquide Lab (June 7)
- Kevin’s speech at the college of Economics and Business in Shanghai Jiao Tong University (June 10)
- Delegation from the Luxembourg Ministry of the Economy visited VeChain’s Shanghai office (June 13)
- Kevin‘s speech to the senior management of Li & Fung (June 13)
- Sunny and Jerome were invited to DNV GL Business Assurance Executive Leadership Meeting in Oslo (June 13)
- Sarah joined in “Blockchain Trend Talk” organized by DHL APAC Innovation Centre in Singapore (June 13)
- Chin Qian’s speech at Eaton China Financial Director Meeting 2018 (June 14)
- VeChain was invited to show the enterprises blockchain solution at AWS Summit 2018 in Shanghai World Expo Center (June 29)
- VeChain meetup held in Tokyo, Japan (July 5)
- Sunny joined in the Second Digital Economy Workshop held by Tsinghua Center for US-China Relations (July 19)
- Sunny was awarded as ”Star of Blockchain 2018” at China-US Entrepreneur & Investment Summit (July 23)
- Kevin’s speech at Xiaocong live (xcong.com) to share how to promote the development of VeChainThor platform development for large scale enterprises application (July 24)
- Jerome joined in the First BMW Group IT Tech Office Demo Day in Beijing (July 27)
Ecosystem Development Investments — Starting from this period, VeChain Foundation has strategically partnered with a dedicated entity with strong background in financial services, investments, technology and business strategy. The team will continue evaluating and looking for projects not only with a solid technical foundation but also clear go to market strategy and business logic to achieve adoption. More information about this dedicated strategic partnership will be announced soon to our community. A few dApps that are going to be developed on the VeChainThor mainnet have been announced (see below). Outside of dApps built on VeChainThor blockchain we continue investing in projects providing infrastructure level services such as blockchain and smart contract security, scalability and interoperability solutions, which we believe will empower the VeChain Ecosystem.
Announced VeChain Ecosystem projects (May — July)
- Plair (May 18)
- Decent.bet (May 29)
- MustangChain (May 29)
- OceanEx (June 15)
- Safe Haven (June 17)
- Esprezzo (June 20)
- Cahrenheit (July 19)
We hope to provide even more transparency to the community in the era of VeChainThor Mainnet. We are committed to following what has been laid out in the VeChain Development Plan to maximize the use of the proceeds and VET holdings to grow the VeChainThor Ecosystem to be the most powerful blockchain platform.