VeChain and Chiliz are two smaller cryptocurrencies that have received a decent amount of attention from the greater cryptocurrency community over the past year. This has led to speculation regarding which of the coins appears more promising for the future.
Our opinion is that VeChain is a much more promising project than Chiliz, which we will cover in this article.
What is VeChain?
In simple terms, VeChain is a blockchain intended to make supply chain management easier by using the blockchain and distributed ledger technology. It will do this by combining distributed ledger technology with the Internet of Things (IoT) to solve major problems in the supply chain industry.
The big takeaway is that VeChain is a blockchain solution aimed at businesses rather than consumers.
Now, VeChain actually has two tokens, which can confuse people. Basically, you have VeChain Token (VET) serving as a store of value token. Holders of VET are rewarded with a different token called VeChainThor (VTHO).
VeChainThor is used to pay gas for smart contracts and other payments.
It’s an innovative system, but does raise some flags with the Securities and Exchange Commision (SEC) regarding the status of VET.
Finally, VeChain does not use a proof of stake (PoS) or proof of work (PoW) consensus model. That’s unusual because almost all blockchains use one of those two consensus models to validate transactions.
Instead, VeChain uses something called Proof of Authority (PoA) to verify transactions on the blockchain. The basics of this are that validators stake their reputation rather than tokens for the right to validate transactions non-consecutive blocks on the blockchain.
Validators have an incentive to maintain a trustworthy reputation because only trustworthy validators have the right to mine blocks. This consensus model also makes scaling much easier and is particularly suited to a business oriented blockchain like VeChain.
What is Chiliz?
Chiliz is a completely different than project than VeChain with a completely different focus. The focus with Chiliz is on sports and entertainment. Specifically, the project has a social media website called Socios.com.
Sports fans can use Chiliz tokens ($CHZ) to purchase sports team branded tokens that give them some team rewards and other perks.
The token itself is available as an ERC-20 token and a BEP-2 token (Binance Chain). We like that it’s available on Binance because this opens up the token to more people. Ethereum simply has fees that are a little too high for most people.
Chiliz vs VeChain Token Financials
This section will compare some of the different financial aspects of the project with each other. As you will see, VeChain is a significantly more valuable project than Chiliz.
VeChain Market Cap: $6.3 billion (#32)
Chiliz Market Cap: $1.7 billion (#82)
VeChain clearly has more value than Chiliz with a market cap nearly four times higher than Chiliz’s market cap. For those that don’t know, market cap is calculated by multiplying the token price by the circulating supply. This offers a good metric on the total value of the token.
VeChain Price: $0.094
Chiliz Price: $0.33
Chiliz has a higher price than VeChain. This sounds good, but all things are not equal. Chiliz has a much smaller supply than VeChain, which gives it a higher price. This is why market cap is a better metric for assessing value than price. Price really is not that useful of a financial metric, but it does have a psychological element to it.
VeChain Circulating Supply: ~66.7 billion
Chilliz Circulating Supply: ~5.3 billion
As expected, VeChain has a much higher supply of tokens than Chilliz. Circulating supply is a good measurement because it takes into account the total number of tokens available on the market. It does include locked tokens because those are not circulating.
VeChain Total Supply out of Max Supply: ~86 billion out of an infinite max supply
Chilliz Total Supply out of Max Supply: 8,888,888,888/8,888,888,888
VeChain has an infinite maximum supply of tokens. We are not a big fan of this because it can cause inflation if not managed properly. However, the way VeChain works with proof of authority an unlimited maximum supply is basically a necessity. Chilliz, on the other hand, has already minted the maximum amount of tokens, so the price can only go up if demand goes up.
We like the tokenomics of Chilliz more than VeChain.
Why VeChain is More Promising Than Chiliz
So, we find VeChain much more promising than Chiliz. Chiliz is interesting, but it’s a product with a much smaller market and one that will likely lose out to non-fungible tokens (NFTs).
Sports teams are far more likely to release their own NFTs rather than partner with an obscure website that requires users to jump through different hoops to interact with it.
VeChain, on the other hand, targets an industry that is ripe for innovation with a technology perfectly suited for the industry. More importantly, there are not really any viable competitors to VeChain. Chiliz has a massive, viable competitor in the form of NFTs.
We also like that VeChain has already demonstrated far more success by having a larger market cap and already gaining some real world use cases. We know that Chiliz has partnered with a few sports teams and the UFC, but we just find the product too difficult for the average sports fan to use compared to an NFT.
With all that in mind, we find VeChain a far more promising project. It easily has the potential to completely change the supply chain industry. We also like the innovations done with proof of authority. We would be surprised if Chiliz is around in 5 years. NFTs will completely dominate the market that Chiliz is attempting to penetrate.
Where to Buy VeChain and Chiliz?
VeChain is a large cryptocurrency available on all the major centralized exchanges like Coinbase, Binance, and Huobi. You should not have much difficulty purchasing it.
Chiliz is in a similar category for token availability, but it does have a little less availability than VeChain. You can still pretty easily find it on most major exchanges like Coinbase and Binance.
That covers it for our brief look at VeChain and Chiliz. We find VeChain a much more promising project overall than Chilliz. Our problem with Chiliz is mostly that the market Chiliz wants to penetrate (sports token) will likely get taken over by NFTs as they offer more flexibility to teams and are easier for the end user to use.
VeChain offers a very good solution with blockchain supply chain tracking to a major problem in a major industry (supply industry). The work VeChain has done with proof of authority may also solve some of the scaling problems found in the blockchain industry.