VeChain’s Tokenomics Just Got a Makeover: What It Means for VET’s Price

• VeChain’s tokenomics upgrade strengthens $VET’s value through new incentive models.
• Exclusive VTHO staking rewards and reduced inflation boost network participation.
• Technical indicators suggest positive short-term momentum for VeChain’s price growth.

VeChain ($VET) has announced an upgrade to its tokenomics, aiming to strengthen the value proposition of the $VET token. The new incentive-based models will enhance user engagement and improve the overall reward systems within the network. 

These updates, highlighted by Michaël van de Poppe, could drive changes in VeChain’s price behavior, including possible price stability and increased trading volumes, which could lead to a possible breakout for the token.

According to the report, VeChain’s 2.0 upgrade introduces a strong incentive model designed to benefit stakeholders and encourage active participation within the network. 

As part of this overhaul, the network is focused on a reward system that strengthens the utility of $VET, increasing its value to traders and long-term holders. According to VeChain’s official announcement on February 19, 2025, these upgrades are crucial for driving mass platform adoption.

Related: VeChain (VET) Price Dip: Buy Now or Wait and See?

Tokenomics Model: Key Changes

Moreover, a major upgrade involves the exclusive staking rewards for VTHO, which Validators and Delegators will earn exclusively. This update eliminates the generation of idle VTHO from inactive wallets, tackling a common issue in tokenomics that can lead to diluted rewards. In simple terms, only active participants will earn VTHO rewards, making the system fairer.

In addition, VTHO inflation will be reduced by 72.2%, with the issuance curve now tied directly to the total amount of VET staked. This change is expected to create a more efficient distribution of VTHO, rewarding active network participants.

VeChain’s tokenomics overhaul also incorporates a reduction mechanism by increasing the VTHO burn rate. Under the new model, 100% of VTHO transaction fees will be burned, reducing the total supply of VTHO and possibly increasing its value as demand for the network grows. Essentially, more VTHO will be removed from circulation, potentially making the remaining VTHO more valuable.

VeChain Market Performance & Price

Following these updates, VeChain’s price increased by 3.30%, reaching $0.03235 over the past day. 

VeChain’s market capitalization has grown to $2.62 billion despite a decrease in trading volume. While VET’s trading volume dropped by 17.42% in the last 24 hours, the price has continued to rise in recent hours, showing sustained market interest.

Adding to this positive outlook, VeChain’s technical indicators show positive signals for short-term price growth. The MACD line is above the signal line, which basically means the price trend is likely upward.

Source: TradingView

Related: VET Gains 90% in December; Analyst Sees $0.63 in 100 Days

Additionally, the RSI of 54.17 indicates that the market sentiment is positive without being in overbought territory. In other words, the market is optimistic, but not excessively so.