We are excited to present the third quarterly VeChain Foundation Financial Executive Report. This is the last report before we enter into the VeChainThor mainnet era, as such the presented VET numbers in this report do not consider the 1:100 token split unless stated otherwise.
This financial report covers the period from February 2018 through April 2018. We sincerely welcome the community to uphold us to this transparency commitment to monitor the funds usage and development process of all aspects within the VeChain Foundation.
VET Supply Overview
By the end of April 2018, the ratio of the circulating VET supply is 61%, which is roughly 2% larger than what was reported in the last quarter financial report.
- Enterprise Investors — In the last reporting period, we settled a significant portion of the enterprise investment as this period covered most enterprise investment from the tokens initial offering to the end of the reporting period. In this period (Feb ~ April), VeChain has received even more interest from enterprises, governments, institutions, and others for partnerships and collaboration. However, as VeChain became more impactful in the public industry, we began looking strictly for strategic enterprise partners who could bring fundamental changes or value to the ecosystem. While most of our business partners acquire VETs on the open market, ~2.3million VETs were acquired from this pool by our strategic enterprise partners who are looking at holding the VETs for their long term purposes.
- Co-Founders, Development Team — In the last reporting period, ~9.5 million VETs were paid out as the rewards to the team, as in the first reporting period we delayed the payment with the interruption of a token refund. So in this period, we paid out the third quarterly VET rewards. Exactly the same as in the previous periods, all of our executive team has signed off to voluntarily locking up 100% of their rewards gained in this period for two years, starting from the moment of distribution! This is done partially as a showing of strong belief in the VeChain project from the eyes of the leadership team.
- Operation, Technological and Business development — The allocated budget has been used on technical research of VeChainThor mainnet, market promotion, community outreach as well as facilitating the growth of future VeChainThor ecosystems. In this period we began to witness a drastic increase in situations where we were presented the option to acquire goods, services and the opportunity to fund/invest in technology with VET instead of fiat or BTC/ETH. The overall budget and expenses 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.
Total VET supply on the VeChainThor mainnet
On April 30, we conducted a stock take of the total live ERC20 VET supply on Ethereum. By deducting the amount that was burned due to token refund (VETs sent directly to the dead address and the VEN token smart contract address), we determined that the total supply of ERC20 VET on the Ethereum as of April 30 is 867,126,344.
As we launch the VeChainThor blockchain mainnet at the end of June, a 1:100 token split will occur. Based on the total supply of live ERC20 VET as of April 30 2018, we conclude that the total supply of VET on the VeChainThor mainnet will be 86,712,634,466. All VeChain Tokens (VET) on the mainnet will be minted in the genesis block and distributed to token holders through the token swap process, which we will have detailed instructions on.
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 stays stable comparing with the last period. A summary of the expenditure in each category is as below:
- Technological Research and Development — During this period some of the R&D projects consisted of initiatives relating to the future scalability and performance upgrade of the VeChainThor mainnet, VeChainThor dApps, enhanced IoT sensors as well as the VeChainThor hardware wallet. Some of these subjects are in the scope of the VeResearch program which VeChain collaborates with universities and research centers. We have also been continuously growing the development team over the course of the year, and in this period alone we have hired 20 full time engineers.
- Business Development — The VeChain Team has been tirelessly engaging in business meetings, attending conferences and giving speeches to form partnerships and raise the market awareness. More importantly, we managed to expand the community building to South Korea and Japan.
Announced Partnerships (February — April)
- Australian 188 Business Alliance Association
- Yida Future
- Shanghai eGrid Consulting Co., LTD
- INPI Asia
Highlights from the community and marketing events (February — April)
- Sunny’s meeting with Alexander De Croo, Deputy PM of Belgium (Feb 12)
- 1st Technical AMA (Feb 13)
- VeChain video contest (Feb 14)
- VeChainThor re-branding event in Singapore (Feb 25)
- Tokyo GFSI 2018 (Mar 5)
- Tokensky conference and Coinnest meetup in Seoul (Mar 13)
- DHL Innovation Centre Startup mixer (Mar 28)
- Kevin’s speech at Roche Supplier Summit (Mar 28)
- Schwarzman Scholars meetup (Apr 3)
- Top 10 blockchain Technology solution providers in 2018 by APAC CIO outlook (Apr 7)
- Blockchain seminar in East China University of Science and Technology business school (Apr 8)
- Kevin’s speech at the Retail and Consumer Seminar in PwC Shanghai innovation center (Apr 9)
- Kevin’s Speech at Food and Beverage Industry Seminar organized by PwC Singapore and Agri-Food & Veterinary Authority of Singapore (Apr 11)
- Sunny’s fireside chat at Harvard (Apr 12)
- Kevin’s Blockchain and Fintech speech at the event organized by the Office of the Government of the Hong Kong Special Administrative Region of the PRC (Apr 12)
- TCL Eagle Talent Program visit (Apr 13)
- Crypto Media Collection held by DeNA Coinjinja in Tokyo (Apr 13)
- CTO Gu was invited to 2018 STM32 Summit (Apr 26)
Compliance & Legal — Compliance and legal expenditure decreased in this period as contracts of some of the service providers ended. New service providers were engaged and these cost will be reflected in the later period.
Ecosystem Development Investments — The expenditure of this area has significantly increased, as VeChain Foundation started growing its investment capability we have supported additional projects and ventures that will benefit the VeChain ecosystem. As the mainnet goes live, we expect to invest more resources in helping and incubating projects which fit the Foundation evaluation criteria and are using the VeChainThor Blockchain.
We hope you are also excited as we are for the upcoming VeChainThor Blockchain mainnet launch. This milestone will embark a new era of the VeChain Project beginning the official launch of the Foundation, early supporters, enterprise users, and our Authority Masternodes together in one thriving transparent, adaptable, and governed ecosystem. This event will also create a more dynamic economy to surround the ecosystem and enable the Foundation to maximize its use of the VET and proceeds to help build the ecosystem to benefit the community.