Community Proposal: Implementation of a Partial Token Burn Mechanism for $VET

We propose that the VeChain Foundation consider implementing a moderate and scheduled token burn mechanism for VET with the aim of:

Increasing attractiveness for long-term holders,

Gradually reducing the circulating supply,

Stimulating the growth of the VeChain ecosystem in competitive markets.

🎯 Justification

VET currently lacks a burn or deflationary dynamic, unlike many modern projects such as Ethereum (EIP-1559), BNB, or Terra (before its collapse).

Despite its strong enterprise adoption, the price of VET has remained stagnant since the bull run of 2021, discouraging long-term retention.

🔥 Technical Proposal (basic version)

Phase 1 – Analysis and Transparency

Quarterly publication of tokens held by the Foundation, intended use, and unallocated surpluses.

Phase 2 – Scheduled Partial Burn

Proposal: burn between 1% and 5% of VET tokens directly held by the Foundation during the first year.

Distribution:

50% of the tokens to be burned will come from inactive surpluses.

50% may come from repurchases in the secondary market, if conditions allow.

Phase 3 – Optional Activation Based on Milestones

Activate future burns only if clear milestones are reached, such as:

Monthly enterprise usage of the network exceeding X TX.

Sustained price of VTHO >$0.005.

Introduction of new nodes or improvements in PoA 3.0.

🔄 Alternatives or Extensions

Incorporate a proportional burn in certain staking operations or new nodes.

Create a “Community Burn Pool” mechanism.

Use VET generated by fees in marketplaces or DApps in the ecosystem for automatic burning.

🧠 Possible Benefits

Benefit Description

Greater Scarcity Controlled reduction of supply

Incentive for Holders Reinforces the value proposition of holding VET

Market Confidence Signal of commitment to long-term holders

Stimulus to Activity Could attract new investors.

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