VTHO: The Lifeblood of Transactions, Supercharged

As VeChain Renaissance introduces its game-changing protocol upgrades, one transformation stands out for its direct impact on every participant in the ecosystem — the supercharged reimagining of VTHO tokenomics!

The dual-token model has long been a cornerstone of VeChain’s design, enabling enterprises to forecast transaction costs even during periods of high demand. While this feature remains intact, VTHO is entering its next evolution — one that aligns network value with active participation.

Through the implementation of dynamic fee markets, enhanced burning mechanisms, NFT staking functionality, and a reimagined distribution model, we’re about to witness VTHO unlock its full potential as the supercharged lifeblood of VeChain. Let’s break it down.

VTHO Generation, Reimagined

Renaissance transforms how VTHO enters circulation. Rather than being generated uniformly at 0.000432 per VET daily regardless of network contribution, VTHO will be generated based on an issuance curve directly correlated with total VET staked across all Delegator and Validator Nodes — a change that puts a greater portion of network rewards in your wallet.

Under this updated framework, VTHO generation is directly tied to VET staked, reducing overall inflation and adding greater deflationary pressure to synchronize protocol growth with long-term value creation. This model better incentivizes those who actively contribute to network security by acting as Validators or Delegators.

Starting with a dramatic 72.2% reduction in initial inflation, VTHO issuance grows sustainably alongside network participation. Based on staking projections, the annual value inflation of VeChainThor, including VET/VTHO, will start from 0.6%, reaching 2.9% if the total VET stake reaches 60 billion VET (70% of total supply).

Fuelling Scarcity: 100% Burn and the Gas Fee Market

VeChain Renaissance introduces a powerful deflationary mechanism via the newly introduced gas fee market arriving with the Galactica upgrade — a 100% base fee burn. Every transaction on VeChainThor permanently burns all VTHO, removing it from circulation entirely.

This shift to complete fee burning helps better correlate network usage and VTHO scarcity. As transaction volumes increase through business adoption and growing dApp ecosystems, the burn rate will accelerate, and potentially exceed the controlled issuance rate, driving deflation.

The dynamic fee market amplifies this effect by optimizing transaction pricing based on network demand. During periods of high activity, base fees automatically adjust upward, increasing both the amount of VTHO consumed per transaction and the total amount permanently burned.

Complementing this burn mechanism is the new priority fee system. Users can now pay a “tip” to prioritize their transactions by block producers. Unlike base fees, 100% of these priority fees are distributed directly to Validators and their Delegators as additional rewards, further incentivizing network participation.

The VTHO/VeBetter Flywheel: Compounding Growth and Deflation

This supercharged VTHO model creates a powerful flywheel effect that accelerates with each new transaction. As more applications launch on VeChainThor, VTHO demand increases to create a self-reinforcing growth cycle.

VeBetter, in this scenario, operates as a powerful interplay — a new application layer driving VeChainThor’s economic engine. Every sustainability application built on the VeBetter platform generates transactions that consume and burn VTHO. The B3TR token, VeBetter’s native incentive token, drives user engagement across these applications, indirectly fuelling VTHO demand.

This creates a multi-token synergy where B3TR incentivizes sustainability actions, which generate VeChainThor transactions, which burn VTHO, which increases demand for VET stakers who secure the network. Each component strengthens the others in an elegant economic design.

Rewarding Network Contribution

VeChain Renaissance reshapes how VTHO flows through the ecosystem. Previously, passive holders and exchange wallets accumulated VTHO without contributing to network security, contributing to excessive inflation. The new model eliminates this inefficiency, ensuring only active participants — Validators and Delegators — are rewarded with VTHO.

We will publish an article with much greater detail on Validator/Delegators next week.

Validators: Securing the Network

Validators run the infrastructure that secures VeChainThor, processing transactions and producing blocks. 101 Validators will operate at launch, earning 30% of all VTHO block rewards. They can stake between 25M to 600M VET, with higher stakes increasing governance influence and block production probability.

Delegators: Powering Decentralization and Economic Stability

Delegators play a key role in decentralization and economic stability. X-Node and Economic Node holders mint Staking NFTs that represent VET collateral, which is then delegated to their chosen Validator for a share of 70% of VTHO block rewards.

To enhance accessibility, Renaissance introduces three new Economic Node tiers:

• Dawn Node (10,000 VET): An entry-level opportunity with a 1.0x reward multiplier
• Lightning Node (50,000 VET): A mid-tier option with an enhanced 1.15x multiplier
• Flash Node (200,000 VET): A premium tier with a 1.3x multiplier

These new tiers create a clear pathway for broader participation in the VTHO economy while maintaining proportional rewards based on contribution level.

Early Bird Staking Program: First Movers Advantage

The Early Bird Staking Program, launching summer 2025, provides enhanced incentives for those who secure their position early in VeChainThor’s transformation. Early participants will be rewarded with higher base APYs and large bonuses, ensuring optimal returns from the outset.

TL;DR: The sooner you stake, the greater your rewards. Stay tuned for further announcements and details as we approach the launch! Details will be shared, worry not.

Your Role in Supercharging VTHO

The VeChain Renaissance is underway, and now is the time to help shape its future. The Galactica phase has introduced the first set of VeChain Improvement Proposals (VIPs) open for an all-stakeholder vote until March 4th.

Renaissance isn’t just an upgrade — it’s the beginning of VeChain’s next chapter in mass adoption. By casting your vote on VeVote, you directly influence the network’s tokenomics, scalability, and interoperability, ensuring VeChainThor remains a leader in real-world blockchain adoption.

Join us in building a more efficient, sustainable, and valuable blockchain ecosystem — powered by a supercharged VTHO that rewards active participation, drives network growth, and builds long-term value for all VeChain stakeholders.

VTHO: The Lifeblood of Transactions, Supercharged was originally published in VeChain on Medium, where people are continuing the conversation by highlighting and responding to this story.