(Updated 10. September 2022)
In this article, I will describe the similarities and differences between VeChain and Chainlink with the hopes of helping you get a better grip on the two projects, and figure out which you think is better. First of all, here’s my opinion:
Chainlink is better than VeChain, as it is less risky and has more potential in the long term. Regardless, VeChain is also a solid project with big partnerships in the exciting sector of supply chains.
I’ll explain my position in detail. Here’s the agenda for today:
What are VeChain and Chainlink?
VeChain improves supply chain management and provides proof of authenticity for brands.
With VeChain’s blockchain solutions, businesses can slap a QR code on products that can be scanned by potential customers, showing the entire process from manufacturing to selling, proving the authenticity of the product.
For example, you can scan the QR code on a bag of coffee beans to see exactly where this particular bag of coffee was made, how it was made, how it was shipped, how it was packed, etc. Also, it helps keep track of businesses’ inventory, and other logistical stuff.
You can read about what I think of Vechain in this article: Is VeChain A Good Investment?
Chainlink is the leading “oracle network”. It has 55 times more adoption than its closest competitor and 22 times more than its four closest competitors combined, as explained in this article.
Chainlink connects the blockchain to the real world by feeding data through its decentralized oracles. Basically, Chainlink can feed data from the real world into smart contracts on blockchains, making them much more useful.
Chainlink greatly enhances the use cases for blockchain tech and is a key player in the entire industry. It has roughly 1500 partnerships and adds up to 10 new ones weekly. The potential of this sector is mind-bending, as decentralized confirmation of data can be adopted by every other sector in the industry.
You can read about what I think of Chainlink in this article: Does Chainlink Have A Future?
How are VeChain and Chainlink similar?
- Marketplaces. Both of these coins can be bought, sold, staked, or traded on various cryptocurrency exchanges around the world.
- Native coins. Both of these projects have native coins, as VeChain supports the VET coin, and Chainlink supports the LINK coin.
- Smart Contracts. Both of these chains support smart contracts.
- Supply Limit. They both have a maximum supply; VeChain has a limit of 86.712 billion coins whereas Chainlink has a limit of 1 billion coins.
- Low transaction fee. Both VeChain and Chainlink have low fees.
How are VeChain and Chainlink different?
- Decentralization. VeChain is semi-centralized due to its consensus mechanism. Chainlink is highly decentralized.
- Market Capitalization. Chainlink is almost twice as big as Vechain in terms of market capitalization. (source)
- Blockchains. VeChain was previously built on the Ethereum blockchain but it shifted to its own blockchain in 2018. Chainlink is built on the LINK blockchain.
- Usability. VeChain is specifically designed to enhance supply chain management and business processes whereas Chainlink aims to provide a network of decentralized oracles linking the real world with the blockchain world.
- Consensus Mechanism. VeChain uses a Proof of Authority consensus mechanism whereas Chainlink uses a Proof of Stake consensus mechanism.
Historical Performance of VET and LINK:
Let’s take a look at how these two have performed historically, going back to January of 2020.
Historical Performance of Chainlink (LINK):
Chainlink surged roughly 30,000% in the bull market from the end of 2019 to May 2021.
In the current bear market, it is down roughly 85%.
Historical Performance of VeChain (VET):
VET surged roughly 9,000% in the bull market from the end of 2019 to May 2021.
It has since crashed by over 90%.
It seems way more volatile than Chainlink, as both the surge and crash were more choppy than in Chainlink’s case.
I have a free newsletter you can sign up for where I send out technical analyses on Ethereum from time to time; check it out:
Conclusion: Chainlink is better for investors, VeChain is better for traders
Fundamentally, Chainlink is the more exciting project in my opinion. The sector of decentralized oracle networks has the potential to grow into tens of trillions of dollars one day, and Chainlink is the number one player by a factor of 55.
Historically speaking, Chainlink is also a bit less volatile than VeChain, especially in the bearish movements.
For these reasons, Chainlink is the best investment of the two. For traders, VeChain is a great opportunity as it offers more choppy price movements.
Personally, I hold Chainlink for the long term and swing trade VeChain with a 3-6 month perspective.
To learn how I personally trade and invest, check out this article.
(all charts are made with tradingview, and in case you missed the disclaimer: This is not financial advice. It is just my personal opinion. Do your own research!)
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