VeChain, a leading blockchain platform, has launched Renaissance, its most significant economic upgrade to date, fundamentally reshaping its tokenomics. This overhaul introduces a more deflationary model for VTHO and shifts rewards to active participants, aligning with VeChain’s Web3 for Better vision.
VeChain just dropped a tokenomics upgrade
— Stacy Muur (@stacy_muur) March 11, 2025
• No more passive $VTHO earnings
• Inflation slashed, burning increased
• Staking is now the key to rewards
Here’s what’s changing and why it matters↓ pic.twitter.com/HbrHBUKOMs
Key Changes in the Renaissance Upgrade
A passionate Web3 enthusiast has broken down the critical aspects of this upgrade, emphasizing the following major transformations:
- Passive VTHO earnings are eliminated.
- Inflation has been reduced by 72.2%.
- Transaction fee burning has significantly increased.
- Staking is now essential for earning rewards.
Previously, VeChain holders could passively earn VTHO by simply holding VET. However, with the new system, rewards are now distributed based on staking participation. This strategic shift ensures that contributors, rather than passive investors, benefit from the network’s economic model.
What Does This Mean for VET and VTHO Holders?
Under the new system, VET holders must stake their tokens to generate VTHO. Network validators receive 30% of block rewards, while Delegators—who stake and assign Staking NFTs—share the remaining 70%.
The staking model is tiered:
- Validators: Require 25 million VET and earn the highest rewards.
- X Node Delegators: Receive a 1.5x reward multiplier.
- Economic Node Delegators: Earn a standard 1.0x reward.
Early staking offers higher yields, with potential APYs reaching 12.8% if 10 billion VET is staked. However, as more participants enter, yields will gradually decline, reinforcing the scarcity of VTHO.
Strengthening VeChain’s Tokenomics
With inflation slashed by over 72% and 100% of base transaction fees being burned, the Renaissance upgrade significantly enhances VTHO’s deflationary model. These changes aim to foster a sustainable blockchain economy by increasing scarcity and rewarding active participants.
Also Read: VeChain’s Renaissance Upgrade: A New Era of Staking, Rewards, and Tokenomics
While the upgrade brings a promising economic shift, its long-term impact will ultimately depend on market adoption and participation. Nonetheless, VeChain’s commitment to evolving its ecosystem signals a bold step forward in blockchain sustainability.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of CoinBrief.io. Before making any investment decisions, you should always conduct your own research. Coin Brief is not responsible for any financial losses.
