VeChain, a rather popular phenomenon in the global blockchain landscape, will be moving towards incorporating Decentralized Finance (DeFi) functionalities in its second official release version.

According to the VeChain 2.0 whitepaper, which was released earlier this month, the smart contract will aim to bring revolutionary opportunities for the development of decentralized finance, and what the company calls “open finance”.

What Is VeChain?

VeChain is an Ethereum-based blockchain smart contract, which operates under the “proof-of-authority” consensus. In other words, the VeChain Foundation gets to select block issuers and has substantial control over the growth of the blockchain network.

While this is one of the less popular consensus models, VeChain has attracted a lot of attention in the area of supply chain management and operations. The platform operates through the help of two different blockchain tokens – the VeChain Token (VET) and VeChainThor Energy (VTHO). While VET is used to facilitate value transactions, VTHO is the powerhouse that allows these transactions to be fulfilled.

VeChain 2.0

With the release of the second version of the VeChain platform, the VeChain foundation outlines several major goals for the development of the whole network. According to the whitepaper, there are several different areas of interest for the VeChain Foundation, and one of them is the modernization of financial operations across the world.

The first main objective of VeChain 2.0 will be to employ the benefits of blockchain technology, in order to provide a “transparent and trusted data platform” for businesses and organizations in the food industry. The goal of this effort will be to provide customers with relevant product data, through QR scanning and blockchain-based data storage platforms.

Other objectives of the updated VeChain platform include optimizations for the automotive sector, fraud prevention, and the creation of a blockchain-based assurances platform called “My Story”.

VeChain 2.0 And Decentralized Finance

In terms of finance, VeChain 2.0 has even greater plans. In the whitepaper, the VeChain Foundation outlines a number of dysfunctionalities of the way finance is working at the moment.

One of the biggest advantages VeChain outlines is the fact the blockchain technology can lead to unmatchable cost reduction in the finance sector. While decentralized finance has seen a lot of implementation attempts so far, there are serious regulatory hurdles for the adoption of this model globally.

This is why VeChain has a “stronger belief in “open finance”. What VeChain 2.0 will aim to achieve is to provide banks and financial operators with the opportunity to bring efficiency and transparency to their operations through blockchain technology and the VeChain platform.

To achieve that, VeChain 2.0 will develop a settlement layer, consisting of a number of fiat-backed stable coins, create a data-storage layer, and facilitate the development of enterprise financial solutions through their platform.

Of course, these are significant goals, and time will tell if VeChain 2.0 will have the capacity to meet all of them. Hopefully, there will be a push in the right direction, and “open finance” will bring us one step closer to truly decentralized financial services.